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Rebates Targeted By Federal Trade Commission - Expertise in Demand


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Press ReleaseSource: Promotional Marketing Insights

Rebates Targeted by Federal Trade Commission - Expertise in Demand
Wednesday January 18, 10:15 am ET


MINNEAPOLIS, Jan. 18 /PRNewswire/ -- Consumer confusion, retailer issues, pressure from the Federal Trade Commission, and state legislators have combined to cause a spike in interest in why some rebate programs succeed and some fail. Angry consumers want to know why it is so difficult to get rebates they're entitled to -- and so does the FTC. Hal Stinchfield, founder of Promotional Marketing Insights, said that demand for accurate and objective information on managing rebate programs more effectively has quadrupled in recent months.

"Two of the most common misconceptions are that marketers are making rebates intentionally difficult -- and that 50% of rebates go 'unredeemed;' unfortunately, neither of these statements is accurate," says Stinchfield.

He attributes the recent attention to a unique confluence of circumstances:


    --  Rebate spending is at its highest level in the history of sales
        promotion -- about $6,000,000,000.00 is spent and 400,000,000 rebate
        checks are issued every year.
    --  Marketers are concerned by complaint levels but have not been
        effective at decreasing them.
    --  Poor communication and execution (rather than intentional deception)
        has caused unprecedented levels of consumer complaints -- especially
        on higher value rebates.
    --  When rebate requests are either denied or later than promised, some
        consumers believe they've been ripped off.
    --  The extraordinary quantity of complaints has attracted the attention
        of the Federal Trade Commission, legislators, and state Attorneys
        General -- the FTC has vowed to watch rebates very closely in 2006.
    --  This has attracted the attention of the media -- who want to
        understand if rebates are legitimate.

"Rebates are a legitimate marketing tool when communicated and executed properly; some legislators have misappropriated blame for consumer backlash on intentional marketer deception -- the fact is consumer complaints are a by-product of improper offer design and execution, not fraud," said Stinchfield. "There is a big difference between a marketing tool and a marketing scam -- marketers don't need regulation, they need education," he added.

Consumer complaints were so high last year that at least one electronics retailer was cited by the Federal Trade Commission for not delivering rebate checks on time, and yet another vowed to stop rebating altogether.

"Discontinuing rebates or regulating them is not the solution -- the solution is to fix what's wrong with them," said Mr. Stinchfield. Complaints on rebates can be reduced by at least 90% with a simple combination of a root cause analysis and a corrective action plan for offer structure, communication, and execution.

Mr. Stinchfield has overseen the management of over 50,000 consumer promotions and is retained by retailers and marketers to increase customer satisfaction, reduce wasteful spending, and ensure compliance with state and federal regulations.

For further information, go to or call Mr. Stinchfield at 952-404-1915.


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Hal Stinchfield


Promotional Marketing Insights ♦ 2255 Abingdon Way ♦ Orono, MN 55356
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