Saturday, April 21, 2007

When is a rebate not a rebate?

When I purchased my cool Samsung Blackjack phone, Cingular had a rebate program in place offering a $100 rebate if you bought the phone and signed up for the data package.

I took them up on the offer, followed all the directions and sent in my rebate form the next day. This is the step that the cynical Conor (me) believes they hope you won't do (so they get the benefit of offering the rebate without having to give you the cash -- and it's your fault since you didn't follow through). Of course, being the pedantic person that I am, I *always* fill in the form and send it in just to make sure they pay up.

Well, today -- approx 6 weeks later, I receive the "the rebate". I was expecting to receive a check like any other rebate program that I've ever participated in. A check that I could exchange for cash at my local bank, or just deposit into my account.

However, that wasn't to be. Cingular sent me a "Rewards Card". This is a Visa debit card that supposedly carries the value of my rebate.

Perhaps I'm over-reacting, but I'm not at all happy with this. In fact, I'm downright pissed. This is some form of bait-and-switch that should be illegal. When you offer a rebate to your customer, you should provide them with a CASH rebate, not a debit account that they somehow have to figure out how to use.

For the smart ones out there who were thinking, just use the card to get cash -- no dice. I thought the same thing, but alas the rules include:

Your card is valid only in the U.S. and may not be used for cash withdrawals or at any cash dispensing machine.

It's even invalid at the gas pump. If you want to use it to pay for gas, you have to go inside the station and wait in line.

And, of course, it expires in a relatively short period of time.

What are the problems with this debit card model?

  • Cingular hopes that this is another deterrent for the user getting the full value of the rebate. At the minimum, it will slow down the transfer to cash to the user as the user finds ways to make use of the debit card until it is used up.
  • Most facilities are not setup to allow you to mix multiple payment methods, especially online merchants. This means that to get the full value, you have to find a collection of things that add up to the exact amount of $$ on the card (the card even prohibits you from adding $$ to increase it's value up to a value you would want to spend.
  • Cingular hopes that nobody will be able to use up the exact amount ($100 in my case) and so they will profit from the remaining cents left on the card. The only way to totally use it up is to find a friendly merchant who will let you use multiple cards on the same purchase).
  • I'm sure there's some slice of the transaction fee paid by the merchant that somehow makes it into Cingular's pocket (yes, cynical Conor strikes again).

In fact, as I was writing this blog entry, I went to Amazon to try to use up the entire value of the card right away. However, I ran into that "single card" problem for a purchase (so my $100.75 purchase wouldn't work as it was 75 cents over the value of the card). I ended up spending $92.86 of it (just couldn't find something worthwhile to purchase for $7.14 and so I have to remember the card and the amount so that if I do end up making a purchase again, I can use up the rest of it... Perhaps some candy at the local grocery store).

Can you tell that I really hate the idea of this bait-and-switch reward card vs getting the rebate check? Cingular you should listen up -- this is the kind of thing that Elliot Spitzer likes to go after.

Tags : / / / / / /

9 comments:

J Panzer said...

Here's how I did it in exactly the same situation: Go to Amazon. Find the buried link that lets you buy gift certificates. Buy one, email it to yourself. Get the code and redeem it, adding the total to your Amazon.com account. It will stay there for (a year?) and will be applied to your purchases until it's all used up. Every cent. And you can laugh with glee at outsmarting Cingular every time you use it.

Nari said...

You can also go to a cingular store or online at cingular.com and have it added to your account's credit. In 2 months it will get used up (assuming you have a 39.99 plan) and any balance will carry over to the third month. My cingular store agent told me this.

of course what I still dont like is that the card might take up to 10weeks to reach you (acc to their website) and they give only 120 days (~17 weeks) of validity from the card issuance date. Isnt that smart of them.

Conor P. Cahill said...

Thanks Nari, I didn't see that option anywhere in the docs and with my family plan, we'd have used up the $100 very quickly. I still think that it is totally misleading to say you will send a rebate and then send something that you can't exchange for immediate cash.

In any case, John's answer above -- the amazon.com gift to yourself -- was the best solution I saw and I was able to use up my last $7.14 without a problem that way.

Anonymous said...

j panzer, that was a brilliant idea. I was about to hit the expiration date and this seems to be working without an issue! Boo ATT/Cingular.

Anonymous said...

hi ive recieved the same debit card..cant use it a 7-11 though??why is that???

Anonymous said...

I too was very confused to receive a vonage reward card for the phone I bought over a year ago. I have to admit it worked when I purchased something online but I was even more confused to receive another card in the same amount today. I have called the toll free number numerous times to tell them they made a mistake but this number is not available for some reason.

Jon said...

Hey, I agree. It's a bum deal. I'm always skeptical about rebates, and prefer to try to find the 'automatic' ones (i.e. it's really just on sale, but they make it sound nicer by 'giving' you something, too).

In any case, one random suggestion on how to spend an exact amount: Starbucks always lets me use multiple sources (for example, their starbucks card balance on my Duetto visa, and then another card or cash afterwards). Let one big corporation's surprisingly good customer service solve the problem that another big corporation lays on you.

Jon said...

Hey, I agree. It's a bum deal. I'm always skeptical about rebates, and prefer to try to find the 'automatic' ones (i.e. it's really just on sale, but they make it sound nicer by 'giving' you something, too).

In any case, one random suggestion on how to spend an exact amount: Starbucks always lets me use multiple sources (for example, their starbucks card balance on my Duetto visa, and then another card or cash afterwards). Let one big corporation's surprisingly good customer service solve the problem that another big corporation lays on you.

Julia said...

Thank you everyone for the tips on how to use the card. I was online hoping to find some helpful postings. Cingular is being sued for this but I doubt it will be settled before my rebate card expires.