The Long Rebate Wait
By: Source: AARP Bulletin Today Date Posted: 2004-04-23 14:47:00-04:00
If anyone should know how to get a rebate, you'd think it would be Sheila Adkins, a spokeswoman for the Council of Better Business Bureaus. During the holidays, she splurged on a DVD player and two videos for her children—Rugrats Go Wild and Freaky Friday.
After spending a total of $300, Adkins expected $85 back in mail-in rebates. It took her three months to get a portion of the refund.
Adkins says she almost didn't get the $75 rebate from the portable DVD player because she was told she sent in the wrong bar code from the box. She didn't get the rebate offered on one of her movies because she submitted only one original cash register receipt for all three items.
"If you pay for everything together, you only get one original receipt," she says. "No one tells you that you may need additional receipts [to qualify for the rebate], so how would you know to ask?"
Adkins' frustration reflects a growing chorus of complaints by consumers who argue that companies aren't making good on mail-in rebate offers. Yet the practice of enticing shoppers with cash-back incentives on everything from computers to cell phones has grown by as much as 30 percent in the last year, industry experts say.
Matthew Gold, a lawyer with the Federal Trade Commission, says complaints about rebate offers nearly doubled last year.
Various factors make it difficult for consumers to collect their funds. Many companies contract with rebate-processing centers, or fulfillment houses, to pay customers' rebate requests. But increasingly, says Mike Leonard of the Continental Promotion Group in Scottsdale, Ariz., which handles rebates for more than 400 companies, some manufacturers are slow to pay the centers. "No fulfillment house sends out checks to the consumer until they've been paid," he says, adding that it's an industry-wide problem.
Other companies don't set aside enough money for rebates, underestimating how many consumers will submit claim forms. But some deliberately make it difficult to redeem rebates by imposing complex qualifying terms and conditions.
Gold says he believes most companies that fall short on rebate promises are poorly managed—not underhanded. "With larger companies, it's more of a bureaucratic problem caused by a lack of planning," Gold says. "There's some negligence involved, but I wouldn't characterize it as anything stronger than that."
But Peter Kastner, an executive of the Aberdeen Group, a market research firm in Boston, says, "Rebate-handling is a scandal waiting to burst. I don't feel regulators are focusing on this area nearly enough."
In California, recently proposed legislation would strengthen consumer protection laws in rebate offers. A spokesman for state Sen. Liz Figueroa, D-Fremont, says she introduced the measure "because almost everyone has a story about the difficulty in getting rebates."
With an increasing number of companies using rebates to generate sales, are consumers getting the deal they think they are?
"Manufacturers get the sale at list price, which is their highest possible profit, and only sometime later, if you remember to send in the rebate coupons and get all the details right, do you get some money back," Kastner says.
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