Rebates: An Ethical Issue?

Rebates are a form of sales promotions that have seen increased use over the past few years, with the difficulty in compliance increasing over time. To avoid fraudulent rebate claims, manufacturers have established such stringent rebate requirements that many consumers are unable to satisfy them and realize the rebate. The issue has become one of ethics in that manufacturers are aware of these difficulties, and are relieved of their obligation concerning the offer. This paper analyzes the actions of manufacturers according to the ethical framework put forth by Laczniak (1983) and makes recommendations for change if rebates are to enjoy continued use free of regulation. Further, the impact of rebate offers on the lower classes is explored. It is postulated that the less sophisticated shoppers will be more affected by the requirements of rebates and the difficulties associated with compliance than the better informed shopper.