Revealed!! Why are Rebates Still Around?
On any given day at Ben’s Bargains, we’ll list deals with rebates, often around 10% of the entire day’s deals. Rebates are still a fairly common marketing tool in online shopping, especially among PC component manufacturers. Video cards, memory and software are common examples.
Here’s the thing: nobody likes rebates. As bargain hunters, we view rebates as the illegitimate stepchildren of coupons, only a step removed from the dregs of all deals—yes, the dreaded store credit or gift card.
You do eventually get your money back (in the form of either a check or Visa gift card)… in most cases. Of the many rebates I’ve submitted over the years, only one didn’t work out and it was luckily a $5 rebate. Sometimes, you know, you have to cut out a bar code from th box, and for you box collectors or resellers, that bites. And this is where it gets tricky for vendors: if just one rebate doesn’t work out, no matter how little, that customer is likely never going to buy its products again. So it’s a two-way street. Caveat emptor, as they say.
So why are rebates still around? A rebate may be delayed deal gratification, but it’s better than nothing. We’ll post them when a rebate represents the lowest price we’ve seen out there to a significant enough degree that it’s worth the hassle.
On that note, if you really want to see rebates go away, redeem them. Something like 40% of rebates go unredeemed because they really are a hassle. For manufacturers or retailers, this is a big plus because they can advertise a lower price point and not lose as much money. In other words, they have their cake and eat it. So do your due diligence and stick it to the man. The best rebates are the ones that you can track online and tell you when your form was received, etc. I always look for that.
Rebates are also appealing to manufacturers because rebate forms directly collect information about customers, like address, phone number, email address. Information like that is worth the calculated risk of doing a rebate rather than simply cutting the price. As consumers, we’re also taking a calculated risk with our information.
Then there’s the fact that the manufacturer can continue to collect interest on revenue until it comes time to return some of it via the rebate redemptions, if and when they arrive. Again, it’s worth the calculated risk of possibly turning off potential customers. And, in 2011, nearly half of all consumers submitted a rebate, and that number represented a 10% increase over a few years earlier. So fewer and fewer consumers are turned off.
If you can wait it out though, you will eventually see an equivalent sale price to a rebate offer. Because rebates work as advertising and promotion, they’re usually in the earlier stages of the product life cycle. When a product is getting liquidated to make room for a new product, you’ll see those rebate offers replaced with immediate point-of-sale discounts.
What do think of rebates? Tolerable or not on your life? For the current rebate offers at Ben’s Bargains, click here.