Long Live Rebates (with SnippCheck!)

It’s no secret that rebates have long been one of those promotion marketing tools that skirts a fine line between effective and downright sleazy.

When purchasing a product, consumers are more likely to adjust their perceived value of the product by applying the rebate amount to the listed price. So a $120 camera with a $50 rebate is viewed by most consumers as being worth $70 – a steal of a deal. However, rebates are intentionally designed to create what the industry euphemistically refers to as ‘breakage’ – basically that there are lots of hoops for consumers to jump through before they actually get their rebate check. And their breakage rates can be remarkably effective – according to a BusinessWeek article, “the industry’s open secret is that fully 40% of all rebates never get redeemed because consumers fail to apply for them or their applications are rejected.”

Wow.

But there’s a fine line between creating breakage and breaking your relationship with your customers. It’s one thing to require a customer take an extra step (or two) to claim their rebate post-purchase; its another thing entirely to have them run a marathon for the extra savings. 

In the rebates world, most consumers fall into three categories: the busy or lazy ones who never apply for the rebate; the die-hards, who would jump through any and all hoops to get the rebate; and those in the middle who apply for the rebate but are busy enough (or aren’t crazy enough) to pursue their rebate checks with the Doberman-Pinscher like dedication if there are any issues that get thrown up. The ideal rebate program is one that depends on the first group for breakage, but not alienate the second and third group of people by making it too difficult for them.

With SnippCheck’s mobile-based receipt processing solution, companies are able to achieve both goals: create some amount of breakage without actually alienating most consumers. 

SnippCheck allows consumers to take a photo of their receipt with their mobile phone (no more need for stamps and trips to the post office). They can submit it immediately via picture text messaging, email or via a mobile web upload page. Receipts are processed within 48 hours (as opposed to six or eight weeks). They have full transparency in the process and are immediately notified of the outcome of their submission (as opposed to getting a cryptic letter in the mail with no explanations). From the company’s perspective, processing rebates digitally is much more cost-effective and produces a bunch of valuable purchase data they can use to fine tune their marketing spend – whilst still preserving the breakage.

Net net: happy customer, happy company. And that makes us happy.

We are processing two large scale rebate programs for companies already and have seen considerable success, both in terms of customer response and client feedback. 

More importantly, more and more of our clients (and potential clients) are thinking like we are: that customers still come first; that the point of rebates is to entice customers to purchase, not alienate them from ever purchasing again; that the lifetime value of a customer is always greater than the breakage savings from a one-off purchase.