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REBATE & PREMIUM FULFILLMENT ARTICLES

    wpe1.gif (1096 bytes)    USING REBATES FOR ACQUIRING NEW CUSTOMERS

      wpe1.gif (1096 bytes)    RESEARCH REVEALS THAT 60 PERCENT OF REBATES ARE NOT REDEEMED

     wpe1.gif (1096 bytes)    FULFILLMENT IS AN ESSENTIAL PART OF ANY INCENTIVE OR PROMOTION

     wpe1.gif (1096 bytes)    MAIL-IN OFFER FORM CHECKLIST

      wpe1.gif (1096 bytes)     wpe1.gif (1096 bytes)    REDUCING SHIPPING COSTS THROUGH NEGOTIATIONS

     wpe1.gif (1096 bytes)     PREMIUM INCENTIVES DECLINE 2.4 PERCENT IN 2001

       wpe1.gif (1096 bytes)      "A STUDY OF THE INCENTIVE MERCHANDISE AND TRAVEL MARKETPLACE, 2000"

     wpe1.gif (1096 bytes)    KEYS TO DETECTING AND CONTROLLING REBATE FRAUD

       wpe1.gif (1096 bytes)    HOW TO PROTECT YOUR COMPANY FROM REBATE FRAUD

       wpe1.gif (1096 bytes)    DEVELOPING A  MAIL-IN OFFER FORM

       wpe1.gif (1096 bytes)    HOW TO REDUCE YOUR MAILING COSTS

       wpe1.gif (1096 bytes)   THE HIDDEN COSTS OF PROMOTION FULFILLMENT

        wpe1.gif (1096 bytes)    HOW TO CHOOSE THE RIGHT FULFILLMENT HOUSE

             INDUSTRY TAKES STEPS TO CONTROL REBATE FRAUD

    
        HOW TO DEVELOP AN EFFECTIVE REBATE/REFUND PROMOTION

             KEYS TO EVALUATING YOUR FULFILLMENT PROGRAM

POSTAL INSPECTORS FOCUS EFFORTS TO PREVENT REBATE FRAUD

PREMIUM PROMOTIONS REQUIRE CAREFUL PLANNING

MARKETING & MISCELLANEOUS ARTICLES

COUPON RELATED ARTICLES

FREQUENT SHOPPER & RETAILER ARTICLES

SWEEPSTAKES ARTICLES

   wpe1.gif (1096 bytes)    USING REBATES FOR ACQUIRING NEW CUSTOMERS

Consumer rebates have been and continue to be used to initiate the relationship between consumers and brands. Rebates use the promise of a discounted purchase to capture consumer information: ideally this transaction is supposed to establish a positive and continuous relationship with consumers, however, in many instances, the opposites occurs.

Consumers love the savings provided by rebates; however, they hate the long wait that can be associated with payment or feeling left in the dark wondering when their check will arrive. On the retailer or manufacturer side, companies are challenged with implementing a rebate program that will please consumers while increasing consumer loyalty at a "reasonable" cost. This relationship becomes strained and trust is often lost. One major problem facing retailers and manufacturers is the increasing cost of acquiring consumers at the beginning of the relationship.

A Jaffray & Company 2006 market study of five channels for customer acquisition revealed that the cost per new customer using Internet search engines was ($8.50), Yellow pages ($20.00) On-line display ads ($50.00), Email marketing ($60.00) and Direct Mail ($70.00).

Another problem is that most retailers and manufacturers can’t reliably communicate with their consumers once acquired. On average, three-fourths of consumers opt out of receiving marketing emails and 25 percent who opt-in are lost in 90 days due to a change of address and email filters making it increasingly apparent that email marketing alone does not work.

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wpe1.gif (1096 bytes)    RESEARCH REVEALS THAT 60 PERCENT OF REBATES ARE NOT REDEEMED

Market research firm Aberdeen Group reports that about 60 percent of buyers who could redeem computer-related rebates don't try. "That's money the store and/or the manufacturer keep," says Aberdeen analyst Peter Kastner. Of the 40 percent who give it a shot, half experience problems or don't get a check at all.

Part of the problem is that three parties--the product manufacturer, the retailer, and the rebate fulfillment house--are usually involved in the process. Each company ends up relying on the others to ensure that things go smoothly.

Rather than process thousands of redemptions themselves, manufacturers and retailers frequently contract with a fulfillment house to open and sort mail, log in consumer data, and, if all requirements have been met, issue rebate checks. But those fulfillment houses can't cut any checks until the sponsoring manufacturer or retail store hands over the rebate money, which can take anywhere from 15 to 90 days after the fulfillment company's invoice date. If the sponsor pays the invoice with a paper check, the fulfillment house must wait several days for that check to clear before it can write any checks to consumers. Sometimes the manufacturer doesn't pay the invoice at all; a few fulfillment houses (which prefer to remain anonymous) told us that they have quietly gone to the Federal Trade Commission to report such a problem.

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wpe1.gif (1096 bytes)      FULFILLMENT IS AN ESSENTIAL PART OF ANY INCENTIVE OR PROMOTION

According to Stanley J. Fenvessy, an expert on the subject and author of Fenvessy on Fulfillment, fulfillment consists of nine major steps.

  1. Order forms and instructions. On an e-commerce site, this includes selecting merchandise, transferring it to an online shopping cart, and filling out shipping information. For an incentive program, it includes rules on qualifying for prizes.
  2. Order receipt. By mail, telephone, or online. Includes initial clerical processing and data entry.
  3. Credit approval. For consumer purchases, includes credit card authorization or check clearance.
  4. List maintenance. Accumulation of customer demographics for marketing.
  5. Inventory control. Management of redemption trends so that merchandise is always available, yet stock levels are not so high that inventory costs are excessive.
  6. Billing. Production of initial bill (if customer hasn't prepaid) and follow-up reminders.
  7. Reports. Production of marketing, merchandising, financial and operating control reports.
  8. Order filling and shipping. Receiving, stocking, picking, packing, and shipping products.
  9. Customer service. Handling inquiries, complaints, and merchandise returns.

HANDLING FULFILLMENT IN-HOUSE

The decision whether to handle the fulfillment process in-house or to outsource it out to a third party hinges on several considerations as with in-house fulfillment you'll have more control over customer service, faster turnaround for reports, and probably lower overall costs.

However, you'll probably move thousands, if not millions, of pieces of merchandise. Do you have sufficient warehouse space and computer systems? The same holds true for incentive programs. Merchandise quantities will be smaller, but incentives still require resources and people for tabulating results, communicating with contestants, and selecting and delivering prizes. Also, look at such factors as management time, the need for new computer systems, additions to staff, and possible upgrades for facilities and equipment. Do you have the budget to start a fulfillment program from scratch? Can you afford to divert resources from your core competencies to handle fulfillment yourself?

OUTSOURCING FULFILLMENT SERVICES

Many companies prefer to outsource part, or all, of the fulfillment function. There are four basic alternatives available:

bulletContract out the entire fulfillment task. This begins with receiving orders by mail or telephone and continues through warehousing and shipping the product, including responding to customer complaints.
bulletUse a data processing contractor to receive orders, obtain credit approval, produce warehouse-picking directives, maintain perpetual inventory records, and generate reports on inventory control, marketing, and financial results.
bulletHire a physical fulfillment contractor. Here, the requirement to buy, build, or lease and then equip a distribution center is eliminated. The contractor will warehouse and ship the products.
bulletUse a telephone contractor. An outside organization has experience handling sales peaks and valleys, time zone problems, investing in equipment, and managing a fluctuating crew of trained operators. This type of service is usually priced on a per-call basis.

 Before outsourcing any type of fulfillment contractor, ask these questions:

bulletHow quickly can the contractor deliver merchandise, issue reports, and resolve complaints? Ask for the company's closure rate in resolving problems in a single call.
bulletHow long has the firm been in business? Are the kinks in its tracking systems ironed out?
bulletHas it handled a similar project before? If you're running a national rebate program, an experienced firm will alert you quickly to the fact that, for example, consumers are sending in proofs-of-purchase for the wrong product, says Mickey Straff, president of Marketing Masters, a fulfillment firm in Riverton, NJ. Experience in early problem detection allows time for corrections.
bulletWhat is the contractor's price structure? Fulfillment houses will tack a profit margin onto the cost of merchandise and/or charge an administrative fee.

PLANNING A FULFILLMENT PROGRAM

If you decide to run your own fulfillment department, you'll need to establish policies and make decisions on the following:

  1. If you are running a call center to receive orders, determine the level of service that you plan to provide. It is neither economical nor practical for all calls to be answered without a delay. Determine an acceptable level of customers who will be inconvenienced. For example, some fulfillment centers aim to handle 90 percent of calls (within 20 seconds) without placing customers on hold or into voice mail. As you develop historical data on the call center, match-staffing levels to incoming call patterns.
  2. Decide who will process orders and how they will be processed. Steps include downloading orders from the Internet or extracting orders from envelopes, sorting and batching, processing checks and credit cards, and printing.
  3. Establish customer service policies. Under what conditions will refunds or merchandise credits be offered? How will orders not containing sufficient payment be handled?
  4. Choose a picking system. There are three major ways for warehouse workers to physically pick orders off the shelves:
  5. bulletSingle order picking. Each item on an order is picked from various locations by a single worker.
    bulletMultiple picking. Several orders are picked at once, using a truck or cart.
    bulletSequential zone picking. The order moves by conveyer belt or cart from one zone to another and is assembled at a final packing point.
  6. Choose packing materials. Carton sizes will depend on the product sizes and typical order size. Cushioning materials can include newspaper, tissue, Styrofoam pellets, or bubble wrap. Optimal choices depend on cost, weight, and the desired degree of protection against damage.
  7. Establish a relationship with your shipper. Determine pickup schedules, and find out what the shipper's packaging requirements are.
  8. Develop a way to capture customer order data. Data might include a source code for how the customer found you, customer telephone number, date of first order, total orders to date, total order value, and types of products ordered.

To ensure that 98 percent of orders are filled and shipped promptly:

  1. Increase inventory levels.
  2. Staff up at the warehouse.
  3. Add more computer capacity.
  4. Extend the returns policy.
  5. Introduce overnight delivery in the final phase of the sales cycle.

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wpe1.gif (1096 bytes)    REDUCING SHIPPING COSTS THROUGH NEGOTIATIONS

Parcel contracts challenge negotiators with their complex terms and conditions. You recently negotiated a contract with a parcel carrier and you find out that your discounts don't apply on certain shipments and that a general rate increase has raised your rates even though you have a contract and extra charges have added 20 percent or more to your total bill.

Below are our recommendations when you are negotiating a contract with a parcel carrier:

  1. Get all the details and facts on your shipment characteristics defined in writing.

During negotiations with a parcel carrier, know your quantities, sizes, weights, applicable surcharges, and origins and destinations for each package you ship. Many shippers collect that information with software that can create package-by-package and aggregate shipping reports. Ask to see rate calculations based on your actual shipping activity for one or more sample weeks. Be reasonable about your volume levels because if you overestimate and then fall below negotiated volume and revenue levels, your discounted rate will not be in effect.

  1. Find out what shipment characteristics are profitable for carriers and what's costly for them to handle.

Certain shipment characteristics are more attractive to carriers than others because they yield high-margin, premium shipments as well as those that are relatively cheap to handle on a per-package basis, such as a large number of parcels delivered to a single destination near a major package hub. Carriers are more flexible with discounts on high-margin business than they are on low-margin shipments such as rural and home deliveries. One way increase your discount is to ask if changing any of the undesirable characteristics would reduce their handling costs.

  1. Understand the carriers' pricing policies.

Parcel shipping prices are based on rolling averages, revenue tiers, cell-by-cell pricing and net revenue per piece. Rolling averages represent average weekly revenue levels during the most recent 13-week period; in the 14th week, the first week drops off and is not included in the calculation. In the 15th week, weeks one and two drop off, and so on.  Rolling averages are used in conjunction with revenue tiers or ranges of weekly average revenue you provide to the carrier. The higher the tier, the deeper your discount. Which revenue tier and discount apply depends on the rolling average for that week. If your rolling average falls below a minimum level, moreover, you'll get no discount at all.

Parcel carriers also use "cell-by-cell" pricing, which applies to specific zone and weight combinations, because it lets them maximize per-package profits. (Zones are destination regions, numbered 2 through 8. The further the distance from the point of origin, the higher the zone number.)

Most parcel contracts also include a "minimum net revenue per piece" for individual parcels to qualify for the negotiated discount. If you have packages that fall below that threshold that effectively negates your discount on lower-weight packages.

  1. Make sure you are aware of Add-ons charges, surcharges and excess fees.

Make sure you are aware of Add-on charges like fuel surcharges, rural delivery surcharges, excess tracking fees, and as many as 70 other individual surcharges that  can raise your shipping costs by 15 percent or more. Shippers often don't realize how many of their shipments are subject to extra fees and how quickly they add up, especially since they often are billed separately from the base freight charges. Examples include $10 per-package address-correction fees and over-dimensional charges that treat packages exceeding certain dimensions as if they weighed 50 or 70 pounds, regardless of their actual weight. Knowing which of your shipments will be subject to surcharges will give you a more realistic picture of how much revenue the carrier will be getting from your business.

  1. Review the tariffs and terms and conditions.

You should thoroughly read and analyze your agreement, which may have numerous restrictions that shippers would find unacceptable in other transportation contracts.  It may be possible to negotiate a waiver of unacceptable terms, however if a carrier gives up a profit in one area, you can be sure they will make up for lost revenue with added costs somewhere else in the contract. No one wants to read all of the major national parcel carriers' terms and conditions before starting negotiations. These documents frequently contain "conditions" you'll want to know about such as:

·        If a carrier is unable to deliver a package and returns it to the shipper, it will automatically come back at the 3rd-Day Air rate, unless the shipper specifies otherwise.

·        Shippers are prohibited from participating in class-action suits against the carrier.

·        Carriers may designate tens of thousands of ZIP codes in the United States as being subject to a rural delivery surcharge. Carriers also can add a residential delivery surcharge for commercial buildings located in residential areas.

·        Carriers may allow you to track up to 50 packages or 20 percent of your weekly package volume, whichever is greater, for free. After that, you may be charged up to $3 for each track-and-trace.

·        Carriers will not honor claims filed by shippers that tendered packages through consolidators.

·        General rate increases (GRIs) apply to all shipments, including those under contract. When a GRI takes effect, you will still receive the agreed-upon discount, but it will apply on the new, higher rates. 

  1. Control the pace and structure of your negotiations.

Set realistic objectives and don't let the carrier make the negotiation complicated or make you deviate from your objective. In some cases, giving carriers an objective goal such as cutting total costs by 6 percent, works best. The shipper also benefits by setting the tempo of the negotiations. Generally, the carriers want to make this a long, drawn-out, complicated process because they want you to give.

7.      Make sure the contract covers everything you ship with that carrier.

Do not just negotiate discounts on commercial deliveries or ground service, which make up the bulk of your volume. Include lower-volume (but higher-margin) air or home deliveries that you ship with the same carrier.  You should also include a "third-party" clause in your contract that ensures discounts will apply to packages that agents make on your behalf. These clauses apply only if the agents use your account number.

There are cases, of course, when shippers want to split their business among several carriers. To prevent that, a carrier may offer "portfolio pricing," with discounts for different types of service that apply only if you give it all of your business. Think carefully before accepting portfolio pricing because you may be able to get those same discounts by negotiating separate contracts for each service level, and allows you to switch some business to another carrier without affecting your other discounts.

  1. Renegotiate your contract when business conditions change.

Contracts can last anywhere from one to five years, with two to three years being the most common. But you needn't wait until the end of the contract period to renegotiate. Most contracts allow renegotiation on 30 days' notice, and it's wise to do so when shipment volumes and revenue levels change to such an extent that it reduces your discount. Many shippers pay the price for failing to monitor their shipment activity after they've signed a contract.

When it comes to contract negotiations, the big parcel carriers will never be as flexible as smaller carriers. It is still worthwhile asking for what you want if you can make a strong argument that it is in the carrier's best interest to make those concessions. Ultimately, the strength of your negotiating position relates directly to how much you know.

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wpe1.gif (1096 bytes)    PREMIUM INCENTIVES DECLINE 2.4 PERCENT IN 2001

Promo Magazine estimates that Premium Incentives total sales dropped 2.4 percent to $26.3 billion in 2001 due to the economic downturn and corporate downsizing. Corporations reduced spending on business incentives to $21.9 billion while consumer-targeted programs increased one percent to $4.3 billion. These trends emerged after September 11th including a very high demand for patriotic premiums (flags, stickers, pins, etc.) and employee incentive programs shifted away from travel to merchandise. In addition, marketers used premium offers to strengthen consumer responses and therefore premiums bacane stronger branding tools.

Marketers purchase premiums (merchandise and travel from the following:

Promotional Products Distributor 37%
Direct from the Manufacturer 36%
Local Retail Store 36%
Incentive Company/House 35%
Corporate Travel Agency 30%
Sales Promotion/Advertising Agency 25%
Direct Purchases (Hotel/Airlines)  18%
Internet 15%
Premium Representative  14%
Retail Travel Agency 13%
Mail Order House 13%
Premium Distributor 12%

Source: Survey of Incentive Practices, Incentive Foundation

The challenge with premium incentives is to deliver a unique promotional product with a high-perceived value at a low cost. Gift certificates and gift card programs have become popular incentives. Gift cards offer greater security against counterfeiting and provide improved data collection and makes execution more effective and efficient.

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wpe1.gif (1096 bytes)    "A STUDY OF THE INCENTIVE MERCHANDISE AND TRAVEL MARKETPLACE, 2000"

There’s steady growth in the incentive industry, according to "A Study of the Incentive Merchandise and Travel Marketplace" conducted with 8,000 sales, marketing and human resources executives from a cross section of American businesses by the Incentive Federation at the end of year 2000. But there’s plenty of room for further growth, the study shows.

Total expenditure for merchandise and travel items used by U.S. companies for incentive programs increased to $26.9 billion last year from $22.8 billion in 1996. The study also found that there’s a 6% increase in the number of responding companies that say they use incentives--from 26% in 1996 to 32% this year.

Type

% of Total

Estimated Expenditure
(expressed in $ billions)

Consumer/User Promotions

16%

$4.3

Sales Incentive — Merchandise

15%

$4.0

Sales Incentives — Travel

18%

$4.7

Dealer Incentives — Merchandise

16%

$4.3

Dealer Incentives — Travel

15%

$4.0

Non-Sales Employee — Merchandise

9%

$2.5

Non-Sales Employee — Travel

4%

$1.1

Business Gifts

7%

$2.0

Total

100%

$26.9

Of the 32% of respondents using merchandise or travel, 64% of the responding companies use merchandise and/or travel as sales and other incentives for sales management and internal/outside sales forces, dealer and distributor personnel and independent sales representatives. This year "business gifts" was added as a category.

Key findings and target opportunities

Room for growth
The study found that in spite of the increased use in incentives, 68% of U.S. companies are not using incentives at all, so there is room for tremendous growth in the industry. The top reason given for not using merchandise or travel incentives is concern about cost. Forty-eight percent of respondents who have not used incentive merchandise or travel in the past two years cited cost as a reason.

Companies with fewer than 99 employees are underdeveloped
Big companies are big users of incentive merchandise and travel. Of the responding companies with 1,000 or more employees, 53 percent said they use incentives. Another 40 percent of respondents that employ between 100 and 999 employees use incentives. Companies with 100-999 employee and 1000-plus employees currently have the highest use of incentives, however, according to statistics drawn from Dun & Bradstreet, these companies account for only 1.8% of the total universe of businesses. Incentive use declines as the size of the company decreases.

Employee Counts

No. of Employees

No. of Businesses

% of Businesses

1-4

6,966,126

65.8%

5-9

1,604,214

15.1%

10-19

929,116

8.8%

20-99

905,773

8.5%

100-999

180,812

1.7%

1000+

9,394

0.1%

Total
(Source: Dun & Bradstreet)

10,595,435

100.0%

The distribution, retail and service industries are a key target
Compared to all businesses, these industries are relatively undeveloped with respect to usage of incentive programs.

Companies Using Incentives -- Broken Down by Industry

 

Total Respondents, %

Mfg.

Dist.

Retail

Svc.

Finance/ Trans

Other

Total Companies

 

202

45

82

226

114

89

Yes

32

39

27

27

27

32

27

No

68

61

73

73

73

68

73

 

100

100

100

100

100

100

100

Companies planning to increase their incentive budgets in 2001 represent an opportunity
Thirty five percent of those companies already using merchandise and travel incentives plan to increase their budgets in 2001 for an average increase of 17%. (Sixty percent plan for budgets to remain the same, while only 5% plan to decrease budget, on average 27%). However, the planned increases are not uniform across all company sizes or industry groups. Based on survey participants' responses, suppliers of incentives should consider focusing on the financial, transportation and manufacturing industries because these groups particularly plan to increase their spending in 2001.

Companies' Incentive Budget Plans--Broken Down by Industry

 

Total Respondents, %

Mfg.

Dist.

Retail

Svc.

Fin/Trans

Other

Increase

35

37

30

28

31

41

44

Decrease

5

11

0

4

2

3

4

Remain Same

60

52

70

68

67

56

52

 

100

100

100

100

100

100

100

Cash is rated most effective as a motivator
Cash is still high on the list for motivating consumers, sales people, dealers, distributors and non-sales employees. "Time off from Job" and "Cash Awards" were rated most effective in reaching non-sales goals. This index rating is based on the respondents’ indication of how effective they have found each of the items.

Effectiveness Ratings of Selected Motivations

Motivation

Marketing/ Sales Goals

Non-Sales Personnel Goals

Cash Awards

500

491

Gift Certificates (Merchandise)

428

438

Discounts or Rebates

421

364

Individual Travel

419

392

Merchandise

415

420

Time off from Job

423

448

Group Travel

407

320

Future is bright for non-cash incentives
Nearly seven out of 10 companies surveyed use cash incentives, an increase from 63% in 1996, with respondents rating cash the most effective incentive in reaching both marketing/sales and personnel goals. This represents a large market for incentive suppliers to be convinced of the effectiveness and value of non-cash incentives. A promising sign: Since the 2000 study also revealed an increase in merchandise and travel awards since 1996, respondents are obviously becoming increasingly aware of putting non-cash awards in their motivational mix. Also, according to the study, the retail industry might offer a specific opportunity since the retail industry is over-developed in terms of using cash as an incentive and underdeveloped in terms of using non-cash incentives.

Promotional products distributors primary source of merchandise and travel items of organizations using Incentives
Thirty-seven percent (37%) of the survey’s respondents using incentives have acquired motivational items from a promotional products distributor within the past 12 months. Thirty-six percent (36%) purchased from a local retail store or direct from manufacturer followed by 35% from an incentive company/incentive house. Thirty percent (30%) purchase from a corporate travel agency. Fifteen percent (15%) have used the Internet for motivational programs.

Companies with Web sites could benefit from incentive programs to develop and increase traffic
Eighty-three percent of respondents had a Web site for their organization, but only 16% used incentives to build traffic to it, concluding that this could be a whole new market to tap for incentive suppliers to pitch and develop incentive programs. Additionally, the Internet is also an untapped area for the incentive industry overall, with only 15% of respondents using it. Of this group, 48% used it to source incentive vendors/suppliers-a key reason incentive suppliers could consider and developing their own Web presence. Other common uses included communicating a program to participants (31 percent), purchasing merchandise or services (30 percent), and obtaining information on creating an incentive program (26 percent).

In 1999, the Incentive Federation requested that the Center for Concept Development conduct focus groups with incentive users in the New York, Los Angeles, Dallas, Chicago, and Atlanta areas. The purpose of this qualitative research was to identify issues regarding the following:

bulletThe level of awareness (usage) of incentives by corporate America;
bulletUsage levels of the various types of incentives;
bulletIndustry breakout of user organization;
bulletDelineation by type of incentive used;
bulletDegree of involvement by corporate management/ officers in incentive program planning;
bulletUsage of the Internet for incentives;
bulletSources of information relating to incentives; and
bulletIndications regarding effectiveness of incentives.

In 2000, the Incentive Federation requested that the Center for Concept Development execute the second, quantitative, phase of this research. This research consisted of a mail questionnaire sent to 8,000 executives in a cross section of American enterprises on a national basis. The questionnaire, designed by Ralph Head & Associates, was sent with a $1.00 bill and a postage-free return envelope and reflected issues that were learned in the focus groups conducted among incentive users in 1999. A test mailing of 1,000 was made to ensure that the desired results would be obtained. Once it was determined that the desired results would be obtained the full mailing was made.

The mailing was sent to Sales, Marketing and Human Resource executives in organizations where such titles existed. In others it was sent to the ranking individual (President, owner, etc.), but in all cases it was sent to an individual and not just a company name. The names were provided by Dun & Bradstreet.

Of the 8,000 questionnaires mailed out, 315 were returned as non-deliverable resulting in a net mailing of 7,685. When the mailing was closed for tabulation on November 18, 2000, 808 useable returns had been received. Subsequent to the close 27 additional questionnaires have been received bringing the total return to 835.

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  wpe1.gif (1096 bytes)    MAIL-IN OFFER FORM CHECKLIST

For marketers that are planning to issue rebates, the Rebate Data Center has developed the following checklist to assist you in developing your rebate.

Format

bulletState "Mail-in-Certificate"
bulletProvide deadline for receiving
bulletState amount of rebate
bulletState exact brands and sizes required
bullet"Buy" to exclude pantry stock
bulletState exact amount or item on the rebate
bulletState maximum refund on non-fixed or variable offers
bulletProvide cash redemption value (1/100 of 1 cent) on the offer
bulletAllow at least 2-1/2 x 1-3/4 inches for consumer name and address
bulletRequire a removable proof of purchase, if possible
bulletAvoid printing on plastic or coated material
bulletIllustrate required proof of purchase
bulletVerify that require proof of purchase appears only once on the package
bulletPrint forms in color to prevent unauthorized reproduction

Terms to Include to Help Minimize Fraud

bulletReproduction of this offer in any form without permission from the offer sponsor violates copyright statutes.
bulletReproduction, purchase, sale or trade of this certificate, proof of purchase or cash register receipt is prohibited.
bulletDuplicate requests will not be honored or acknowledged.
bulletWe reserve the right to verify identification.
bulletHand print. No mechanical reproductions or name and address labels accepted.
bulletSignature required signifying compliance with the rules. (If you use this term, include a signature line.)
bulletNo Post Office Boxes allowed; only street and rural route addresses are acceptable.
bulletFraudulent submission could result in federal prosecution under the mail fraud statutes (Title 18, United States Code, Sections 1341 and 1342.)
bulletTelephone number required for certification.
bulletVoid where prohibited, taxed or restricted.

Restricted or Regulated Products

bulletState maximum refund or units of merchandise per name/household
bulletSpecific geographic region where offer is valid
bulletSpecify that residents must be 21 years of age or older when purchase is made
bulletRequire signature and date of birth\
bulletSpecify that employees, retailers and distributors of offer are not eligible

Setting Time Limits for Offers

bulletState beginning and ending dates of offer
bulletInclude "received by" date
bulletState "Not responsible for lost, late or undelivered responses."

Geographic Terms

bulletSpecify the valid area for the offer, i.e. "Offer good only in continental United States, Hawaii and Puerto Rico and from APO/FPO boxes."

Participating in an Offer

bulletExclude resellers of company products from offers
bulletDo not honor or acknowledge requests for additional forms for offers
bulletState offer rights are not transferable or assignable

This form was developed by the Rebate Data Center

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wpe1.gif (1096 bytes)    KEYS TO DETECTING AND CONTROLLING REBATE FRAUD

Industry sources indicate that rebate fraud costs manufacturers over $500 million dollars annually. The U.S. Postal Inspection Service reports that there are approximately 200,000 fraudulent refunders. The most common types of fraud schemes include:

bulletSubmissions by groups and organizations;
bulletMultiple submissions using fictitious names and address;
bulletCounterfeit rebate offer forms, register tapes and proofs of purchase.

Manufacturers are looking to control fraud while paying for legitimate rebates for bona fide purchasers of their products. The following are steps that manufacturers and their fulfillment services can take to reduce their exposure to rebate fraud. James Santella & Associates recommends the following keys to detecting and controlling rebate fraud.

Detecting Rebate Fraud

  1. Receipts that do not state the name of the retailer/stores: Many fraudulent refunders use computer programs or their own cash registers to generate bogus store receipts. You should look for phony store names or misspellings of legitimate names of retailers.
  2. Rebater's request that rebate payment be made to a P.O. Box: Many professional refunders rent dozens of P.O. Boxes in order to receive rebate checks under different names and to bypass the fulfillment services duplicate address check program. We recommend that manufacturers state of their rebate offer form that "Checks will not be sent to P.O. Boxes if the refunders' street address is not also provided."
  3. Computer generated labels: Many organized refunders use computers to generate hundreds to thousands of mailing and return address labels. Writing out hundreds of envelopes as well as the rebate offer forms takes time and time is money to professional refunders. While in today's age of computers, these mailing labels are not uncommon; your fulfillment service should look for receipt of an excessive number of similar looking labels. Fraudulent refunders generally send hundreds of rebates to different manufacture