Making Sure You Don't Get Your Rebate Money: Patented!

from the fun-fun-fun dept

Tue, Oct 10th 2006 1:34pm — Mike Masnick

Here's a nice story that combines two things people around here tend not to like: annoying rebates that never get paid and ridiculous patents. We've all heard stories about the difficulty in actually getting your money from certain rebate programs. In fact, the FTC has had to crack down on companies more than once over the failure to pay out rebates. However, the latest, as pointed out by Good Morning Silicon Valley is a just-granted patent on a system for managing a rebate program. Perhaps there could be some innovative ways to manage a rebate program, though it's questionable if that really deserves a patent. But, what's much more interesting, as GMSV points out, as you read the patent, you realize what they're really patenting is a way to make sure those who run a rebate program can more efficiently make sure people don't get paid. The patent discusses this pretty frankly, explaining that the goal of any rebate program is to "reduce the number of successful rebate claimants" by "requiring post-purchase activities." Any time someone buys a rebate-eligible offering, but fails to get the money, that's considered "breakage." This patent, then, is designed to provide "a more consumer friendly method for processing rebates that maintains a breakage rate." In other words, a more efficient process for making sure you don't get paid. In fact, the patent later highlights that their system, while being more customer friendly, "retains hurdles sufficient to maintain breakage." Sounds just great.

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55 Comments

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Gabriel Tane (profile), 10 Oct 2006 @ 2:11pm

Wow
This doesn't suprise me on either count. Has patent bickering gotten so bad that companies are now publicly clamoring for dibs on who can screw us best?

sweet jeebus.
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Meoip, 10 Oct 2006 @ 2:15pm

Hopefully they will get a rebate for their patent application fee.
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Anonymous Coward, 10 Oct 2006 @ 2:21pm

I'm sick of rebates, and I refuse to buy anything with a mail-in rebate.
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Joshua, 10 Oct 2006 @ 2:33pm

Re:
Hopefully they will get a rebate for their patent application fee.

They would have gotten one but it was too much of a hassle.
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William, 10 Oct 2006 @ 2:34pm

CompUSA sucks
Filled out the forms and everything and never got the rebate so i don't shop there anymore. We'll see if i ever shop at Tiger direct again. It's been a month now since I got confirmation email and still no rebate check. I'm hoping they pay though because that is like 100 bucks. And I spent a couple hours online printing out all the appropriate forms and filling things out online at OnRebate.com(sucks). They have a third party that handles rebates and tries to make it more difficult for you.
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Billy, 10 Oct 2006 @ 2:53pm

rebate schmebate
i think this article is hilarious. why the heck would anyone work to make something more customer friendly and still make it work so that customers can't actually complete the process easily.
this is an insane thing.
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Chuck Norris' Enemy (deceased), 10 Oct 2006 @ 2:54pm

Breakage
I also received a form of "breakage" in a rebate that had the whole top half of the check ripped off. Was it really the mailing system? My address was on the receipt portion of the check so it still made it to my house. I tried to call in to tell them that my rebate check was ripped in half but I had the actual check number. They couldn't find a reference to that check number and said it may have come from the manufacturer. The manufacturer rebate center said the same thing and told me to call the retailer. Bastards!!! It was only one of the three rebates that made my wireless router free and for $10. So I guess I paid $10 for the router instead of just tax(and giving up my information). Still got $40 of rebates though.
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Matthew, 10 Oct 2006 @ 3:02pm

Is this not THE definition of anti-trust? In spirit if not by letter??
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satan, 10 Oct 2006 @ 3:16pm

pay with credit card
if you pay with a credit card and they fuck you out of your rebate, just tell the credit card people that you refuse to pay because you did not get the rebate.
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Dr G, 10 Oct 2006 @ 3:33pm

Re: pay with credit card
Can that really work? by the time you figure out that the rebate isn't coming it's 4 months after the purchase.

Let's get a petition to get companies to distribute rebates 30 days after the deadline date and have FTC enforce it. Then that might work.
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Chris, 10 Oct 2006 @ 3:47pm

My favourite rebate denial came from a DVD player I recently purchased, which had a $50 rebate. The rebate had to be claimed within 30 days by filling out information on a website. That website, however, considered your 30 days within the month. So if it's the 9th of October, your purchase of 30 September was past the rebate period.

Still love the DVD player, though.
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Faz, 10 Oct 2006 @ 3:53pm

Rebates
I hate rebates. they can kiss my undies
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Joe Smith, 10 Oct 2006 @ 3:57pm

New Horizons
That we can now patent activities which are at least immoral opens a whole new world of possibilities. Since offering rebates which are designed in a way to defeat consumers so that they never get what you led them to believe they would get is at least borderline criminal perhaps overtly criminal activities could also now be patented.

Think - new methods for defeating security systems, blasting bank vaults and perpetrating frauds are all now patentable in our brave new world of patent law. If this had been possible in the past Ponzi could have gotten rich off the royalties for his business method and left the actual crime to someone else.
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RantMax, 10 Oct 2006 @ 3:57pm

Good patent!
These jerks will sue the jerks that put hurdles in their rebate systems, for patent infringement.

It's effectively like a scorpion killing itself with its own poision.

Let's drink to it.
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Ronnie Hankins, 10 Oct 2006 @ 3:58pm

Re: CompUSA sucks
I have had very good luck with Tigerdirect.com and "onRebate" over $300.00 in rebate items and no problems so far. All my problems have been with the company rebates,and trying to get Gateway to honor it's 90 Day Warranty
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Ben(damnit), 10 Oct 2006 @ 4:09pm

Here's and idea
I should patent a system, wherby a government body could fine any company found actively seeking to break (false advertising?) rebates an amount equal to 4x the amount of the rebate.

That government body would then send the amount of the original rebate back to the comsumer, and keep the rest for 'administarive fees'.

Everybody wins. ^^
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Craig, 10 Oct 2006 @ 4:24pm

Vonage
Vonage definately maintained their "breakage" rate with me.
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AvyTech, 10 Oct 2006 @ 4:36pm

Re: Re: pay with credit card
This idea makes the most sense. They don't want to refund us after 30 days, so they should only get 30 days to give us rebates.
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wolfrune, 10 Oct 2006 @ 4:36pm

Re: CompUSA sucks
hey i work for one of those 3rd company places, keep calling in if you let your reabte expire your out of luck
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just ®idiculous, 10 Oct 2006 @ 4:37pm

Breakage happens. So what.
Is "rebate hell" worth it? Perhaps not usually. I still prefer a sale price that's a bit higher than a rebate's net price. But of course there's breakage in rebates - newsflash- that's why manufacturer's offer them rather than discounts. So if you don't like them, don't use them. As for me, my Tivo's net cost was about $50, after rebate. And if I had to do a little work for the $150 rebate, so be it. I'm not above the hassle of a rebate. And if Parago can speed up the delivery of my rebate check, I wish them all the success in the world.
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AvyTech, 10 Oct 2006 @ 4:38pm

Re: rebate schmebate
They work to make it more user-friendly and then give surveys about how great the experience was... then you wait around for the rebate for so long that some people just forget them. They hope you're like me and forget as soon as you get home from the store and start playing with the new toy.
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Annoying Bastard, 10 Oct 2006 @ 4:49pm

Screw brick-and-mortar retailers
Crap like this EXACTLY why we will see the death of retail stores as we know them within the next 15 years.

People have gotten sick of lousy customer service, empty promises, and pseudo-pricing.

Why spend the time driving to the stored just to get played by some "ingenious" marketing ploy.

NEWSFLASH TO BUSINESS:
People are waking up to the fact that most of you are only out there to screw us over in one way or another. It might be a good time to review the way you treat the people who make your existence possible.
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Alisha, 10 Oct 2006 @ 4:55pm

rebate
I sent a rebate out for $4 and I got my check for $4. If you want to buy something with a rebate it is your decision to try to get it, if you think it is such a hassle, DON"T BUY IT!!
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Chris Miller, 10 Oct 2006 @ 5:03pm

Re:
No Anti-Trust problem. I don't know how you see the definition of anti-trust. Look it up because you are not even close.
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Rebate Conquest, 10 Oct 2006 @ 5:04pm

REBATE REWARDS
Rebates can suck! They are many times alot of work and a good deal of hassle... but they are worth it many times! I have saved a significant amount of money using rebates for tech items. I have found great ones online. Everyone knows going into it that rebates require effort and time to try to dissaude lazy consumers from obtaining thier money. I have never failed to get a rebate which was owed to me and have saved at least $500 this year alone using them... Sack up and do the dirty work to get your money or don't complain. The fact of the matter is the law is on the consumers side and if you follow requirements the check is in the mail!!!
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brwyatt, 10 Oct 2006 @ 5:30pm

REBATES
As of now, I have never had much of a problem. It takes a few months for "processing" but not much else. If there ever was a problem, I just called and it was fine. (I once bought same ram and it did not have a UPC on it, but I sent every label on it. They complained, I called and the check was sent). Can't belive people can get away with crap like this! Patenting customer mistreatment!
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Chillin, 10 Oct 2006 @ 5:34pm

Re: Screw brick-and-mortar retailers
What does Brick and Mortar stores have to do with this?

Online retailers do more Rebates than B&M's do.
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DigDug, 10 Oct 2006 @ 6:02pm

Rebates are a waste of time no matter what
Here's how I deal with rebates: I look at the pre-rebate price. If it suits me, I buy and ignore the rebate. If it doesn't, I don't buy the item.

Even without breakage, I find rebates to be insulting. Is it really worth my time, my privacy, and my brainpower to read that form, fill it out following all the rules, and then wait 4-6 weeks for my money? My time is worth more than that.

Not only that, but once I've sent off the rebate, I can't return the item to the store because you have to cut off the UPC off the box.
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Bartoons, 10 Oct 2006 @ 7:15pm

So can I...
If I don't get my rebates, now I can sue the company to get my rebate AND claim patent infringement!
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Jain, 10 Oct 2006 @ 7:20pm

Just think about it for a second before flaming
Why is anyone suprised or pissed off about this article? There is nothing wrong with rebates. The whole purpose of a rebate instead of a reduced price is that the company is counting on people either forgetting about the rebate, not caring about sending in the rebate, or doing (or not doing) something that makes them ineligbile for the rebate. So, if you want your rebate money, just play by the rules and you'll get it. If you don't get it then, then you threaten to sue for false advertisement. It's all very simple. Also, keep in mind that it is because of breakage that a company can offer you more savings in the form of a rebate than in automatic discounting. Stop whining.

Now, if you actually read the patent, which is linked to in this article, you will read "the rebate processing system provides a user friendly interface, yet retains hurdles sufficient to maintain breakage." All that this means is that the program is more convenient to use than mailing in paper rebate forms, but will still pose similar situations which would cause breakage, such as actually having to get onto the website, a reluctancy to give out personal information, actually remembering about the rebate, etc.

All of this is very logical, and I'm glad that this patent has gone through. Honestly, when I'd buy rebatable items, I rarely sent in the rebates (unless is was for over $20), because of the trouble, no matter how minimal, but with this rebate system, I will fill out the rebate forms, because it's much easier and I'm usually on a computer anyway.

New motto: think before you flame.
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DotCommie, 10 Oct 2006 @ 7:48pm

I have yet to NOT get a rebate from somewhere. I think you guys just need to be more cautious and write more clearly or something.

I have done probably 20-40 rebates in the last 3 years and have gotten all of them except for one I thought I sent but found in a bag with UPC and everything ready to go...

I always make sure to triple check the checklist of required things, tape the upc and stuff to the form, take pictures of it all together, and then send it out a few days/weeks before the postmark date. One time I couldn't find a copy of the upc or receipt or something of the sort and after calling the rebate place they said to just leave a note saying I couldn't find it anywhere and to sign it. I got that rebate with no problems too...

Also, a lot of rebates people have problems with are handled by Continental Promotion Group which I think is out of Niagara Falls. You can track those rebates through http://rebatestatus.com I took a screenshot when it showed both of my rebates listed there just in case. It was kind of funny because a few days later one of them was taken off of there. I was going to follow up on it and show the pic and stuff but it arrived on it's own in the mail a few days later...

My brother has always had horrible handwriting and he complains about never getting rebates so I assume it's related.
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t, 10 Oct 2006 @ 8:00pm

Re: CompUSA sucks
I had the same issue with tigerdirect for 100 so I called the number and bitched them out and just got my check yesterday.
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Anonymous Coward, 10 Oct 2006 @ 8:24pm

When I am price shopping an item I ignore any rebates other than instant, in store rebates precisely because it takes so long to get the rebate that I forget about it.

It is no secret that rebates are simply marketting gimmicks to drive sales and companies would rather not honor the rebate.

So, I ignore them. If they want to drive sales via lower selling price they will do this via a legit sale where my cost at checkout is less.

Anything else is simply a wanna be scam and I don't care to waste my time of such things.
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Dennis, 10 Oct 2006 @ 9:08pm

Re: Best Buy eliminating mail-in rebates
There are very good reasons that Best Buy has for the most part eliminated mail-in rebates and the headaches of not getting rebates have gotten people really upset amd clearly Best Buy has heard the complaints a few too many times. I do not want mail-in rebates as I only see them about half the time. I would prefer a smaller instant rebate than dealing with often numerous mail-in rebates. Are you hearing this CompUSA, Circuit City and Office Depot? the lack of instant rebates at CompUSA and Circuit City steered me to Best Buy and Sams Club because I would prefer no mail-in rebates, on recent large purchases.
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Anonymous Coward, 10 Oct 2006 @ 11:12pm

Re: CompUSA sucks

Good luck on that there are hundreds if not thousands of reviews showing that no rebate ever comes out of Tigerdirect and Onrebate is actually the same company just a different division I would do a Google on Tigerdirect reviews and check it out.
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Draegen, 10 Oct 2006 @ 11:16pm

No Mail-in Rebates
Not to pedal my own wares, but I work at OfficeMax and our corporate office did the best thing ever a couple of months ago an we now have NO mail-in rebates. And for the most part the instant deals are even bigger than the mail-in ones we used to have. Spread the word.
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Lewis Savage, 10 Oct 2006 @ 11:31pm

My Official Flip off to all rebating companies!
I hereby put all (ALL) companies who offer rebates on any product or service on notice,NO SALE! I will however consider purchasing when they begin making the same offer minus the exact same rebate amount.
Until then they may consider themselves officially flipped off,and that is my gaurantee.
Lewis Savage
682-438-2431
Fort Worth,Texas
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Anonymous Coward, 11 Oct 2006 @ 4:45am

HELLO?????
Why do most people patent something? So they can sue the pants off someone who infringes. Did anyone actually consider that a group of people who were tired of the rebate hassle patented that idea in an effort to prevent companies from doing rebates like they have out of fear of being sued out of existence???

This may actually be a good thing for once.
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mike fip, 11 Oct 2006 @ 5:17am

rebates
Excellent thought. Patent a bad Iidea and sue people that use it.
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Sanguine Dream, 11 Oct 2006 @ 5:27am

And this is...
why I dont bother with rebates. Yeah I MIGHT be able to save some money but chances are I won't get it. Just give me a good sale price.
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Wizard Prang, 11 Oct 2006 @ 5:59am

Re: Re: Best Buy eliminating mail-in rebates
"Best Buy has heard the complaints a few too many times"

The fact that they and TiggerDirect got smacked around in court over rebates might have had something to do with it....
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Wizard Prang, 11 Oct 2006 @ 6:06am

Won't happen
It is precisely because of "breakage" that they can offer big rebates. Without breakage and the ability to play with the quarterly financials (by pushing the rebate hit into the next quarter) they cannot offer the same level of discount over the counter.

I have gotten plenty of "free after rebate" items (including a TiVo, which cost me the sales tax on $150). Would they give stuff away? I doubt it.

Not to blow my own horn, but here is my humble offering on the subject.

http://wizardprang.wordpress.com/rebateguide/
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Steve L, 11 Oct 2006 @ 7:43am

Re: Re: Best Buy eliminating mail-in rebates
Maybe BestBuy is eliminating rebates, but they are making up for it by pushing "Product Replacement Plans" with "breakage" instead. They tell you Ïf you buy this plan, then if ANYTHING goes wrong in the next two years - you just bring it back to ANY BESTBUY store and we'll replace it." The truth is Öh, sir, I'm sorry we changed the corporate policy a few months back - you have to call this 888 number and we ship you a box. When we get the mercahndise - we will ship you a BESTBUY GIFT CARD!!!!!!!!!!!!!!!" Like I would ever go back to these rip-off artisits again! Now THAT's breakage!
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anonymous, 11 Oct 2006 @ 8:38am

I ignore rebates too
Lost an $80 rebate once because even after filling out and sending in all the paperwork, never received the rebate check from Verizon. I agree with the earlier person that rebates are an insult to the consumer. Now I ignore rebates when I shop and look only at the price plus any immediate discounts. My time and peace of mind are more valuable than dealing with rebates and the stress of whether it will arrive. Why do I want the negative, stressful experience of trying to find a company's rebate phone number and calling to yell at them?
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teknosapien, 11 Oct 2006 @ 12:42pm

Am I missing a point here or ...
maybe start holding retailers accountable for mis-represented rebates if you don’t get it with in x amount of time return it with the explanation of hey this did not perform as advertised. (I.e. you advertised a rebate and it doesn’t seem to be working like that). Of course I may be missing some small print but who knows. After all if a large concern like CompUSA or Circuit city has to start refunding for the false claims of the manufactures that they push goods for then maybe something will be done. I know I am powerless to do any thing alone against the powers that be save one exception. I can refuse to support them with my dollars I will always pick the better of the two companies even if it means spending a few extra bucks to do it I refuse to reward sleazy business practices or support sleazy companies.
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Cat, 12 Oct 2006 @ 1:18pm

Re: Breakage happens. So what.
Dell didn't realize that I'd spend all day if I had to to get the rebates! I got a credit for the rebates promised and not delivered. I filed a complaint in the company, but with FTC might not be a bad idea.
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Rebate Reconquistador, 12 Oct 2006 @ 5:15pm

Re: REBATE REWARDS
"Sack up and do the dirty work"

If my time were so cheap, I'd be more inclined to.

As it is, dinky $10 or $20 rebates are not worth my time to fill out and return, especially if it's going to require a half-hour of more work on the back-end to actually get the money promised.

And that's what the companies are really counting on.

So far nobody has mentioned the other obvious benefit to companies of rebate programs, which is the personal information that they obtain which they then can use for marketing (to you as well as for research purposes).
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Alex, 14 Oct 2006 @ 2:31pm

Re: pay with credit card
I hope you dont wait for rebates before paying your creditcard. Youll be paying alot more in creditcard interest than the rebate is worth.
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Mike Best, 19 Nov 2006 @ 5:27pm

Re: New Horizons
Precisely! Just THINK of the riches Ponzi could have had, if he had patented the Ponzi Scheme, and charged the Social Security Administration one one-thousandth of a penny on the dollar!!!

Want to see a REAL rebate scam? Look at the US Government!

C'mon, now! The Greed For The Almighty Dollar now replaces God Almighty! WTF is your problem with this concept; what part of "I'm gonna screw you because the Government says I can" do you fail to understand? Just bend over and take it; do NOT expect a reach-around, or any K-Y!

Either get with the program, SUCKER, or CHANGE IT!
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Wizard Prang, 29 Nov 2006 @ 8:11am

Untrue and potentially libellous
"no rebate ever comes out of Tigerdirect"

Glad to see you remained anonymous. The last rebates I got from TiggerDirect came through after about five months... but only after I had phoned them up and asked nicely.

Recent legal action may have helped them to clean up their act, but I have not been able to bring myself to risk it since then.

Moral: Geeks have long memories.
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Wizard Prang, 5 Dec 2006 @ 6:59am

Close, but no cigar...
"for the most part the instant deals are even bigger than the mail-in ones we used to have"

In my experience this is not really true. OMax is the nearest tech store to my house, and was my preferred store until about a year ago, when the rebate deals dried up. Most of the killer deals - along will ALL of the free-after-rebate offers that interested me - vanished.

Rebates are not the problem, at least not for me. Dishonest rebate houses that use tricks and delays to avoid paying out are the problem. This is why I still do rebate deals (NewEgg, BUY.COM etc), but I don't buy from TigerDirect (for instance).
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Roger Dodger, 8 Dec 2006 @ 4:58am

Well, obviously the no-rebate deals aren't as good as the rebate ones; they are giving away money on EVERY sale, not just the ones that people actually mail in the rebate for. BB, OM, etc, all make a big deal out of "no more rebates", but the effective prices are higher. It's like when you get your house re-valuated..they say "oh, yes, your house value went up, but we refigger your takes at a new, lower rate per thousand"...of course, your taxes go up anyway because they just back into the budget numbers to come up with the amount they need. Come on, sheeple, wake the F up! You are being screwed, lied to, and not even getting a good-night kiss.
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Anonymous Coward, 13 Dec 2006 @ 6:03am

Re: Re: CompUSA sucks
I have always gotten every rebate I have filled out from CompUSA. I followed the SIMPLE directions and received my money via check. In fact CompUSA's rebates are online now so you don't have to cut off the upc code at all.
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Tim, 17 Jan 2007 @ 1:27am

Some of you are crazy
I don't agree with the comments here saying if we don't like rebates, then don't buy it. This is a CONTRACT when you purchase something, and they must honor it.

Anyone who says differently must work for these rebate companies.
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Almighty, 21 Nov 2008 @ 8:15pm

Well if EVERYONE avoided this trap....
If everyone would just NOT buy anything that has a gimmick rebate then there would not be any, period.

right now im only getting 1/2 of my rebate due to marketing tactics, but believe me Ill never shop at tiger direct again on a mail-in rebate headache promotion, in fact ill just order most my purchases online, that way it really cuts out the middle man.
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