Gadgets and Gimmicks

One of the perks of working in the creative field is that part of our job is to know what new technologies or devices are coming out and how that will effect the market. What will the new Sprint Evo be capable of? Can the Ipad do this? How will the droid change marketing and application development? These are all questions that are fun to throw around and we at Brand Advance believe that keeping up to date with the most current and emerging technologies are of vital importance. My usual delight in walking into a Mac store or Best Buy is enhanced by the fact that what I am purchasing or browsing at is actually my civic duty to our client and part of my job.

I walked last night into a store with one of my coworkers to look over a new laptop when the salesperson remarked about the incredible rebate plan “xyz” computer had going. My friend asked why companies would give rebates instead of just lowering cost and it was a good conversation in traditional marketing and consumer behavior so I thought I would share.

Almost all rebates in my opinion are a great gimmick. The perceived lower cost appeals to a mass audience, without having a real lower cost. The general consensus is that rebates are offered is that most people won’t take the time to fill out and send it in to get their money. Although definitely a factor, the more important consideration is this-most companies with hard products sell their products through a particular channel, but when you as a customer buy their product from a retailer, they don’t get your name. They don’t have your email address, your mailing address, your name or any other useful contact information to remarket to you.But if you apply for a rebate, then they’ve got you. They have your name in their database, and even though it may have cost them the rebate price to get your name, they can then turn around and sell your name to list rental companies or other companies that are trying to sell you other products. They can basically rent your name over and over again, and make quite a profit. They can also do follow-up marketing to you directly. They might send you a direct mail piece or an email that says, “Hey, we have such and such now” or “Do you want the new bigger badder model than the one you just bought?” (Moore’s law and rule of near instant obsolescence and all that jazz).

Next time you are filling out that rebate, ask the company what they are doing with the information and you will be surprised to see the response. It is going to be interesting to see how changes on the horizon for privacy and data sharing laws are going to effect rebate programs and offerings.