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Fight the Fraud – How to Eliminate Rebate & Sweepstakes Fraud and Lost Revenue

Promotion fraud prevention

Consumer promotions like rebates and sweepstakes have come a long way over the years. The digital age has completely changed the way brands execute these ‘old school’ promotional programs. But in today’s uber-competitive marketplace, rebates and sweepstakes are still a very effective way to generate brand awareness, build a bigger database and reward loyal customers.

Two important things to remember when planning your next rebate or sweepstakes program:

#1 – Leveraging all of your sales and marketing channels in your rebate or sweepstakes strategy is critical. A seamless integration of your program across instore retail, web and social media will ensure you get successful results with maximum consumer engagement and exposure.

#2 – Rebate and sweepstakes fraud is out there. Yes, a brand can experience up to 9% fraud in a rebate marketing campaign. But with help from the right promotions partner, you can significantly reduce its likelihood and eliminate lost revenue. Here’s how:

Fight the Fraud

Fraud can cost some brands hundreds of millions of dollars annually. The good news is a lot of it can be prevented through good program design and fraud protection services. Some of the most common types of schemes include:

  • Submissions by groups/organizations
  • Multiple submissions from fictitious names and mailing or email addresses
  • Counterfeit rebate forms, register tapes or proofs of purchase

9 Tips for Proper Rebate & Sweepstakes Program Design

One of the best ways to deter fraud is through the proper design of the program and submission form. Below are 9 useful tips – but make sure you always work with your legal team to ensure compliance:

  • Clearly present all fraud statutes. They’ll serve as a deterrent and help cut claims of ignorance on the part of the consumer. For sweepstakes, include airtight rules that require a strict random draw on how winners are chosen. Sweepstakes that allow for consumer input or voting to determine winners are the most susceptible to fraud. If you’re running a contest, the winners should be selected by a panel of judges selected by the sponsor, not the public. Be sure to also fully disclose the sweepstakes with the appropriate abbreviated rules anywhere the promotion is advertised.
  • If you are printing submission forms, use two colors to prevent photocopying. Also include other counterfeit techniques (screens, watermarks, tints).
  • Limit your program’s expiration date (3 or 6 months is often ideal).
  • Specify the exact purchasing requirements for rebate eligibility.
  • Clearly state that a rebate proof of purchase must be acquired through purchase of the product.
  • State that the rebate payment or sweepstakes prize will only be issued to the name of the requester.
  • Show cash redemption value of 1/100 of 1¢. This is a legal requirement for rebate programs in some states.
  • State that the reproduction of a rebate or sweepstakes program in any form voids the offer and violates copyright statutes.
  • Include ‘void where prohibited by law’ language.

Work with a Promotions Expert for a Successful, Compliant Program

Brands should always stay on top of the laws and regulations pertaining the rebates and sweepstakes. But because the laws are ever-changing, and differ from state to state, many brands choose to work with a third-party promotions partner. There are other big benefits to working with a third-party expert besides legal compliance. Their integrated technology platforms will seamlessly manage data collection as well as reporting and analytics.

Here are 8 things to consider when choosing a promotions partner:

  • They should have strong experience in rebate and sweepstakes consulting, processing and fulfillment.
  • They should offer guidance for maximum exposure of program and utilization of technology based on your demographic.
  • They should have the ability to archive rebate and sweepstakes submissions for audit and customer care reference.
  • Their data entry capabilities should be proven fast, accurate, scalable and backed by reliable technology and data entry operations.
  • They should offer flexible rebate reward options (check, pre-paid card, retail check, etc.)
  • They should have clearly defined processes and procedures for handling fraudulent claims.
  • They should also have knowledge of escheatment policies and how they apply to each state.
  • They should offer complete transparency into your program by providing comprehensive, online reporting and proactive account management.

About Promotions Fulfillment Center

At PFC, our clients’ success is our number one priority. Since 1974, PFC has delivered outstanding quantifiable results, with turnkey solutions in fulfillment, rebates, sweepstakes, and contact center – all backed by leading technology. Brands that partner with PFC have historically achieved considerable cost savings in excess of 35+% and have significantly improved their program ROI. Want to learn more? Email us at info@pfcfulfills.com or call us at 800-493-7063.

Sources:

https://www.thebalance.com/rebate-marketing-program-can-it-work-for-your-company-2295728