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Why does Verizon give rebates in the form of prepaid debit cards?

• I bought a new phone a couple months ago, advertised with a 50 dollar rebate. In order to get my 50 dollar rebate I had to: 1) Cut out part of the box and mail it in with the receipt and my signature within a certain time-period (I think 30 days). 2) They sent me a confirmation that they received it a few days later. 3) About two weeks later, they sent me a Citi debit card containing a 50 dollars on it. They included some information on how to use the card to buy things that I don't care for, and small notice saying that I can transfer the money off of the card by going to their website. 4) I went to the website to sign up for a new account for this card (that I will obviously only use one time). I had to first activate the card by calling the toll-free number on it and confirming the number. Now I was able to pick my username and password and sign up for an account. 5) On the website I clicked to transfer the money to my bank account, entered the account number and routing number, and checked that I agreed to some really long terms and conditions. 6) Finally, I received notice that I would receive 50 dollars in my bank account within "2-3" days. Wouldn't this have been so much easier for them to just say "50 dollars off" and apply the discount at the time of purchase? I don't understand the marketing strategy, but it makes Verizon seem like they're really stupid for going through all of that extra trouble to give 50 dollars off the price of a phone. And it makes me think that they have no consideration for their customers by putting me through all of that, almost like they want their customers to beg for the 50 dollars back. Why would they think up such an arduos process??

• Answer:

  If the retailer marked the product $50 off then the retailer's revenue would have been reduced by $50 for that sale.  Many retailer chaff at the forced option to have to discount products because it eats into their revenue.  A rebate from the manufacturer protects the retailers revenue while the manufacturer who's one step removed from the consumer now has the consumers specifics (name, address, etc.) Using a debit card prevents fraud and 'spoilage'. Some other secondary benefits are that some consumers may forget to reclaim their rebates.  Others may not fulfill the complete requirements thus forfeiting it. No doubts about it - it's a real pain and some large retailers are becoming hesitant to participate in rebate programs while others see the rationale and make it that much easier for consumers to claim their rebate checks, er debit cards.