Are instant rebates a deal or a scam? The answer is sometimes you can get a steal on instant rebates, though you need to be on the lookout for scams. Instant rebates are a tool used by marketers to add urgency to induce consumers to buy a product now. They are usually honest attempts to sell a low selling product, or to convince a consumer whose on the fence to make a purchase. To get the best deal on instant rebates you have to overcome the negative stigma around rebates in general. Research has shown that this can be done by putting yourself in a good mood before you shop (Pyone & Isen, 2011). This article shows what Instant rebates are used for, how the stigma over instant rebates developed, and goes in depth on recent research around how a positive mood helps take advantage of instant rebates and make better decisions in general.
What are instant rebates?
An Instant Rebate is a marketing tool used to add urgency to a consumer to buy a product. A customer is told for they will only be able to get the rebate for a limited time before the product returns to its normal price. Instant rebates vary from short term rebates like fifteen minute deals, to long term rebates that last several weeks. They are offered to customers who are on the fence to get them to buy, as well as to all customers to encourage sales of a product. It is important to do your research on instant rebates as a common marketing ploy is to up the price on a product before creating a “rebate” at its normal price. Knowledge is power, so when you see an instant rebate on a product you want, open a new tab and shop around to make sure the merchant is honest (Kumar, Anand, Jhingran & Mohan, 2003).
Buy One Get One Free vs. Instant Rebates:
In order to get the best deal on instant rebates it’s important to overcome the negative stigma around instant rebates. Davis & Millner (2013) found that people prefer buy one get one free rebates to instant rebates when the savings are similar on both. This is because people have negative reference experiences to rebates in the past where companies often used them to make customers jump through a series of hoops to get a rebate. If you want to get the best deal on a product it is important to overcome this bias by shopping around and looking at how much is saved on an instant rebate versus another type of rebate program. Only by looking at the numbers will you get the best deal as every purchasing decision is different.
To Get the Best Deal, Shop Happy!
If you want to make the best decision on instant rebates it’s important to put yourself in a good mood. Read something uplifting, or watch a funny video. By putting yourself in a good mood you are putting yourself in a higher level of thinking from which to make better buying decisions. Pyone & Isen (2011) in a series of studies found that people in a good mood make better purchasing decisions. The first two studies proved that people in a good mood make more prudent decisions about both the present and the future.
In the first study they split the participants into a good mood and normal mood groups. The good mood group was put in a good mood by showing them pictures of puppies, kittens, flowers, etc. The normal mood group was show pictures of chairs, lamps, and other neutral objects. After looking at the pictures the participants filled out two questionnaires: One that measured their mood and one that measured their level of thinking; low level thinking being how an action is performed, high level thinking being why an action is performed. They found that participants who are in a good mood are more likely to think at a high level than those in a neutral mood (Pyone & Isen, 2011, p. 534-535).
The second study determined the participants’ likelihood “to take future outcomes into consideration.” They did this by splitting participants in good/neutral mood groups and giving them a questionnaire that determined participants “future time perspective” by having them fill rate statements like “I expect that I will set many new goals in the future,” and “As I get older I begin to experience time as limited,” on a scale of 1 to 7. The researchers found that people in a good mood were better at thinking about the future than the neutral participants (Pyone & Isen, 2011, p. 535).
Pyone & Isen’s (2011) third study proved that participants in a good mood are more likely to delay gratification by choosing a mail in rebate over an instant rebate when they would get a better deal on the mail in rebate. They did this by splitting the participants into good/neutral mood groups then giving them a survey telling them “their favorite model DVD player was now available for the same price at two online stores, but with different promotions, one with an instant rebate and the other with a mail-in rebate. The mail-in rebate, the participants were told, provided a greater amount of money than the instant rebate but would take four to six weeks to be received,” (p. 535). The instant rebate was $25, the mail in rebate was asked in ascending order starting at $35 going up in $5 increments to $50. The participants chose whether they would want an instant rebate or a mail in rebate on each option. The researchers found that the participants in a good mood consistently chose the mail in rebate more often than the participants in a neutral mood (p. 535-536).
The fourth study conducted by Pyone & Isen (2011) found evidence that “positive affect facilitates consideration of both the costs and benefits of waiting,” rather than a tendency to choose to wait for a reward no matter the difference between a mail in or instant rebate. They found this by splitting participants into good/neutral mood groups, then splitting those groups into different price range groups. The instant rebate was $25 in both groups; the mail in rebate was $30 in one group and $40 in the other. The researchers found participants in a good mood chose the instant rebate more often than the neutral group on the $30 condition, and the mail in rebate more often on the $40 condition. This showed people put in a good mood thought about the choice at a higher level than those who weren’t. More participants in a good mood thought $25 now is better than $30 in a few weeks than those not put in a good mood who simply acted on their tendency to save money or get instant gratification. This study showed that participants in a good mood not only act to save money in the future but weigh the relative advantage of putting off a reward vs. making use of it now.
Conclusion
Instant Rebates are usually an honest attempt to convince a consumer who’s on the fence to buy or to sell a low selling product. To get the best deal on instant rebates it’s important to overcome the negative stigma around rebates in general. Putting yourself in a good mood before you shop is a proven way to make better purchasing decisions (Pyone & Isen, 2011). This article has shown what Instant rebates are, what they are used for, how the stigma over instant rebates developed, and goes in depth on recent research around how a positive mood will help you make better purchasing decisions.
References:
Davis, D., & Millner, E. (2013). Rebates, matches, and consumer behavior. Southern Economic Journal,72(2), 410-421. Retrieved from http://www.jstor.org/stable/20062118.
Kumar, M., Anand, R., Jhingran, A., & Mohan, R. (2003, January 3). Sales promotions on the internet. Retrieved from http://static.usenix.org/event/ec98/full_papers/kumar_promotions/kumar_html/kumar.html
Pyone, J., & Isen, A. (2011). Positive affect, intertemporal choice, and levels of thinking: increasing consumers’ willingness to wait. Journal of Marketing Research (JMR), 48(3), 532-543.
Gifts, celebrations, and even small expenses can add up to staggering sums over the course of the holidays. Although it might be tempting to pay for these expenditures using your credit cards, doing so means deferring payment to another day at the cost of incurring further interest charges down the road. Not only is doing so expensive, but there is also the frustration of having debt constantly looming over your head. As a result, it is in your own best interest to avoid over-spending during the holidays.
