8 | DMNEWS | July 27, 2009 | www.dmnews.com
Rebaters face more laws, enforcement
mission entered into settlements with two companies for
failing to mail rebates within the amount of time promised.
And, the New York Attorney General alleged that AT&T’s
Gonzalo E. Mon rebate advertisements highlighted the post-rebate price, but
Attorney for advertising hid the pre-rebate price in fine print. The AG also argued
Carol Krol and marketing law, that AT&T didn’t adequately disclose that rebates would
Executive editor, Kelley, Drye & Warren be fulfilled using debit cards that were subject to various
restrictions. To settle the investigation, AT&T agreed to
As consumers become more cautious with their spending, pay more than $2.63 million to consumers.
t’s the dog days of summer and what we may look back some companies are trying to lure them back into stores Another area where we’re likely to see more enforcement
on as the dog days of the recession as well. Hopes the with rebate offers. These offers have recently come under is escheat. Under escheat statutes in various states, if a
economy would have begun its slow climb out of the increased scrutiny as states pass new rebate laws and regula- consumer does not cash a rebate check within a specific
hole by now are stalled. Many marketers are reacting by tors challenge companies who fail to comply. time, the check may be presumed “abandoned” and the
sitting tight — a dangerous decision. Every facet of the Laws in various states dictate how rebates can be adver- issuer may be required to turn the funds over to the state. As
direct marketing industry is suffering. The domino effect tised. For example, some states prohibit advertising a post- states face budget shortfalls, many are looking for alternate
of squeezing budgets means some businesses won’t survive rebate price unless the price paid at the register is clearly sources of revenue, including escheat. There is currently a
and others will require radical change. Direct marketers disclosed. Even in states where such a disclosure isn’t spe- lawsuit pending in Iowa regarding escheatment of uncashed
still need to sell products, get people to Web sites to plunk cifically mandated, the disclosure is arguably necessary rebate checks. Rebate issuers should pay close attention
down the plastic and induce them to pick up the phone to comply with advertising laws. Thus, it’s always a good as the case develops.
and order away. idea to highlight the pre-rebate price. Other states have These developments indicate that rebates will continue to
Sara Cisler, director of CRM at The Limited, told me more stringent advertising requirements, so check with be subject to increased scrutiny. As states pass new laws and
recently that getting customers into the store is her biggest your legal counsel before advertising a rebate. challenge rebate issuers, companies need to pay attention and
concern now. Her company has an in-house database of Regulators have also become more active in challenging be able to react quickly to changes in the legal landscape.
more than seven million people, and she drops more than rebate offers. This year alone, the Federal Trade Com- firstname.lastname@example.org
a million direct mail pieces every month to drive sales.
How to tune in to direct response radio
So what is Cisler doing for the next three months? Going
deeper into the house file to reactivate dormant customers
and putting more money behind direct mail at a time
when direct mail volume is down across the board.
“We haven’t decreased the budgets,” she said, calling long as the campaigns underscore a “new and improved”
direct mail “a growing channel.” But, in this economy, positioning. Think of it this way: if your prospective buyer
her budget hasn’t increased either. It wasn’t easy, she can immediately identify what the product is, what it looks
said, but she was able to negotiate her cost per piece, like and how it will benefit him — all in his mind, without the
getting better rates on paper and printing. need to see something for validation or comprehension — it
Negotiating is hardly a new concept, but direct mar- has a shot of working in DRR. If it is so novel or unique that
President and CEO,
keters are particularly adept at running the numbers to Robinson Radio the listener can’t form a frame of reference, or if your pitch
closely track the ROI of each campaign. Analytics are includes the phrases “you won’t believe your eyes” or “wait
the industry’s forté. That’s the good news. “Radio doesn’t work… we know, we’ve tried it.” That the till you see this,” chances are radio is not right for it.
The bad news? This strength obviously will not solve reception that I am used to receiving from clients. Based on Traditional radio likes to put all of its emphasis on frequency
the problems plaguing service sectors in the direct a single mishandled, poorly targeted, untracked radio test, — running the spot repeatedly over a long period of time to
industry. Consider list marketing: As list buyers con- they come to the determination that the entire medium has continuously reinforce the message. While direct response
no merit for their particular product or service. radio also benefits from frequency, it certainly is not a panacea.
That’s when we introduce them to the concept of direct It’s important to avoid the “one size fits all” approach a