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Newegg newsletter showing the 20% cash back promotion ending on 11/28  (Source: vois2, EggXpert Forums)

The same banner a few hours later reflecting the ended promotion
Newegg's massive promotion leaves customers confused, angry

Newegg generally has a good reputation with the technology community. The company rose to prominence around the turn of the century for its lightning-quick FedEx Super Saver shipping and its excellent customer support.

Over the past few years, the company has done much to maintain its reputation with enthusiasts and still manages to hold on to a Reseller Rating of 9.90.

However, Newegg has found itself embroiled in a testy dispute over a promotion it offered on Cyber Monday. The promotion was held in conjunction than with everyone's favorite whipping boy: PayPal.

On Monday, Newegg offered a promotion where customers who purchased merchandise from the site using PayPal would receive 20 percent cash back. The promotion was to start on Monday, November 26 and end on November 28. Under the terms of the promotion, Newegg stated that "The cash back payment will be deposited into your PayPal account by January 31, 2008."

According to Newegg's terms and conditions for the promotion, the 20 percent cash back was limited to a maximum of $50 USD. No other limits were stipulated for the promotion.

A previous promotion that Newegg and PayPal sponsored together in April offered the following wording in the terms and conditions:

Discounted prices and/or promo codes are valid till 04/15/2007 or until 500 orders per corresponding product has been reached; whichever comes first. Once end date is reached or redemption limit has been met discounted prices and/or promo codes will no longer be valid. After this date and/or redemption limit, standard prices will resume and are subject to change without notice.

Monday's promotion contained no such wording.

Shortly after the promotion started, buyers started asking questions on Newegg's EggXpert forum to clarify if the 20 percent discount would apply to all purchases made on the site. One poster, andydepr, used Newegg's online chat to talk to a representative.

"The promotion would only apply to the specific items shown on [the] email," replied Steve, the Newegg online representative.

A Newegg staffer by the name of RoddyR asked posters on the EggXpert forums to bear with him as he received confirmation from higher ups. "I’m waiting for a confirmation email from another department. Looks like this promo might be for ALL ITEMS on I’ll have an update for you shortly," added RoddyR.

RoddyR returned within ten minutes to report, "Confirmed ... PayPal promo good for all items on Newegg."

So all is well, right? Wrong. About two and a half hours after RoddyR gave the go ahead for customers to go crazy with purchases using PayPal, he came back with the following nugget of information: "The promotional funds that PayPal allotted for Newegg has been depleted due to the large amount of traffic today. The promotion has now ended."

And thus the mass confusion began. Customers began inquiring if their order made the cut and if they would be receiving their 20 percent PayPal bonus.

"Please kindly note that we have been informed by PayPal at noon that the promotion has been ended since the money they used to run this promotion has been depleted," said Newegg online representative Venson to a customer. "In addition, we [don’t] know the exact order number is the ending of the promotion. For more information, please call PayPal at 1-402-935-2050."

At this point in time, the original banners advertising the 20 percent promotion were still proudly displayed on Newegg's site and within the email newsletter.

Another online specialist, Coco, added the following: "I do apologize that promotion has ended. It is no longer valid. PayPal provided us with a set dollar amount, and once that amount was reached, the promotion ended. Under the Terms and Conditions it also states Offer was available for a limited time only."

The website was altered to reflect that the promotion "Expires 11/26/2007" later in the afternoon and the banner in the original email newsletter sent to customers was also changed to reflect the termination of the program.

Newegg sent out the following email to customers who inquired about the ended promotion:

Dear valued customer,

Thank you for your inquiry about our PayPal promotion.

Unfortunately, the promotion has ended before noon on 11/26/2007. This promotion was sponsored by PayPal which a set amount of funds were provided for the promotion, and all orders must be placed while supplies lasts. Please know that the cash back is not provided through Newegg, nor does Newegg have any control over the promotion.

We are currently working with PayPal to see if a list could be provided for all of the orders that qualified and was placed in time for the promotion. If you are not sure if your order was qualified or not, please contact us within a few days for more information. We do apologize for any inconvenience this may have caused you.

Please feel free to contact us for any further questions or concerns.


xxxx xxx

Customer Service from Newegg 

So it appears that Newegg is working hard with PayPal to determine who actually made the cut-off point for the promotion before it abruptly ended.

The thread over at the EggXpert forum with confused, angry and information-seeking Newegg customers and conflicting information from Newegg employees can be found here. It is also in this thread where an EggXpert moderator, Jason, posted the following.

"As Roddy said, we will definitely keep you posted once the final results are in. Meanwhile, please don't forget to PM with your Newegg login (email) and I will be happy to send you a free gift. I apologize for not being able to respond to everyone's inquiries via PM, however, I will send you a free gift if I get your login"

So it appears that the least that Cyber Monday Newegg customers will get is a free gift from Newegg (in addition to the original orders). However, most are simply looking for their 20 percent cash back from PayPal.

Comments     Threshold

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RE: Ironic Ad while reading article
By Mitch101 on 11/29/2007 1:45:47 PM , Rating: 2
I dont know but I hope that Dell purchase I made wont go the same route.

I would suspect Feb 1st there will be a class action lawsuit for those who didnt get thier 20%.

RE: Ironic Ad while reading article
By DarkPrime on 11/29/2007 2:29:01 PM , Rating: 2
I too ordered from Dell in the afternoon on monday (a camera). The thing is, my paypal account shows a pending payment on monday, but the full payment didn't transfer until Dell fully charged me on wednesday (basically dell didn't get the money until the camera shipped). No where on Dell's site did I see anything about a limit.

RE: Ironic Ad while reading article
By Mitch101 on 11/29/2007 2:55:56 PM , Rating: 2
Mine wont ship for 2 weeks from monday. Hope that doesnt effect the refund.

RE: Ironic Ad while reading article
By baadcatj on 11/30/2007 2:38:34 AM , Rating: 2
So THAT'S what happened! I couldn't figure out why the order I was trying to place with Dell repeatedly took me to a page that said that there was an error with the PayPal promo. No matter how many times I re-read the 'fine print', there wasn't any mention that there was a limit on the number of orders/customers that this promo was available for (which is standard Dell procedure). It only mentioned the dates.

The same thing happened on another website (I forget which one). Then checking out other websites just to see what was up, similar problems we also experienced.

While it's only my supposition, I expect this is an error on PayPal's part and that they didn't make it a part of their terms and conditions to the online vendors.

Don't get me wrong, Dell, PayPal and NewEgg are not infallible, but they are companies I typically prefer to work with, so I'm not bashing any of them; just stating my opinion that because I experienced the same thing on several websites, I'm leaning toward thinking that this is PayPal's doing.

Now, as a matter of what to do about it... that is the question!

Yes, NewEgg should do more than send out some hats and stickers in order to maintain their 'Eggxcellent' reputation - maybe do a promo of their own to their email list - as mentioned elsewhere here - for a percentage off, up to a maximum amount, for a specified time period, yada yada.

Other PayPal promo 'partners' should do the same in trying to treat their customers extra well after a snafu like this. PayPal on the other hand should also do something to take care of the businesses they messed up, proportional to the manner and level in which they are responsible.

Sorry so long - hope it helps. Just my $.02.

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