Print 79 comment(s) - last by Kenenniah.. on Dec 7 at 2:45 PM

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.

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Finding Fault
By mindless1 on 11/29/2007 2:34:20 PM , Rating: 2
It seems we need to look closer at where this problem began. Did Paypal tell Newegg the promo was over when funds were exhausted, or did Paypal tell Newegg that all purchases were covered from 11-26 thru 11-28?

I suspect the former, not the latter, making it Newegg's fault for advertising the promo ran thru 11-28.


Once they did that, it shouldn't be a matter of informing people in a forum or changing the banner in a newsletter. Once the terms of the deal (actually it's expiration) were changing, there needed to be a bold, order-stopping page the customer had to read and acknowledge stating that the 20% discount was not going to apply. Unfortunately for Newegg, such things take time and can't be put into place at the drop of a hat.

I just can't imagine what was going through the mind of the person who set the terms that the discount would run till 11-28. Where they only looking at daily average sales to guesstimate how long the funds would last without any consideration of how much a site-wide 20% discount would increase sales? I for one was going to max out the $50 allowance with a big-item purchase, but I'm not the kind of shopper who buys big ticket items without some research first and if I'd done that research already, I'd have made the purchase already.

It almost saddens me that I find fault with Newegg instead of Paypal because in general I find Newegg > Paypal. It's not that Paypal isn't entirely blameless though, how did they expect Newegg to offer this kind of promo considering their giant customer base but only a disproportionately small funding for the promo? I suppose Newegg should have advertised something like "The race is on, if you order quickly enough you can get 20% off while funds last".

RE: Finding Fault
By Oregonian2 on 11/29/2007 2:53:24 PM , Rating: 3
... or it could just be that your assumption is wrong (Roseannadanna).

RE: Finding Fault
By mindless1 on 11/29/2007 3:26:32 PM , Rating: 2
Wow, thanks for that informative post.

Are you suggesting Paypal did not disclose to Newegg that the funding wasn't unlimited? I find that very hard to believe, but if you have direct evidence instead of hearsay in a forum, by all means...

I feel you are deliberately trying to confuse what seems a very clear-cut issue.

RE: Finding Fault
By Oregonian2 on 11/29/2007 5:02:11 PM , Rating: 2
but if you have direct evidence instead of hearsay in a forum

Didn't exactly see any direct evidences in your long tirade either. Which was my point. You may be perfectly correct, but you seemed a bit strong to me based purely (AFAI can see) upon assumptions in a situation that seems empty of hard facts between the relationship of the participants in the promotion which itself probably is a response to Google's 10% very long running promotion for first-time users of their paypal alternative. Google's promotion, because of its very long running time, would appear to have a very high limit, even though it of course has to have a dollar limit (even if unstated). If there were 100 trillion dollars of promotion cost run up on it, they'd not pay it all, obviously. That also fuels the reasonableness of PayPal's promotion possibly being intended to be "unlimited" in dollars when restricted to one seller (unlike Google's promotion that has a lot of dealers participating). They may have expected a more limited response to the offer.

Are you suggesting Paypal did not disclose to Newegg that the funding wasn't unlimited?

No, the promotion was clearly not unlimited. The newEgg ads (which I get daily, I've been on their newsletter list for a long time) clearly said that it only runs for a limited period and only on Newegg. I would have used it, but there isn't anything I needed at the time other than a DVI-DVI cable which I could get locally "retail" for less than half of what it'd cost me at NewEgg.

RE: Finding Fault
By mindless1 on 11/29/2007 9:01:50 PM , Rating: 2
I wrote funding wasn't unlimited, not period.

BIG difference. Newegg gave a period implying the deal ws good from the 26th to the 28th. Clearly this was their error as there was no possible way to make good on that claim when it is the amount of money, not the number of hours, that limit the deal.

RE: Finding Fault
By Oregonian2 on 11/29/2007 9:11:28 PM , Rating: 2
Note that it wasn't NewEgg funding the program so the limitation was one of Paypal, not NewEgg. NewEgg may not have known that Paypal was going to shut things off before the end date. Paypal may not have known that it was going to be ending early either (when they started).

RE: Finding Fault
By mindless1 on 11/29/2007 9:16:27 PM , Rating: 2
What is it that you find so hard to grasp? If they don't know when it's going to end that is exactly why it was wrong to advertise based on dates!

RE: Finding Fault
By elpresidente2075 on 11/30/2007 4:25:21 AM , Rating: 2
Living up to your namesake, I see...

RE: Finding Fault
By Oregonian2 on 11/30/2007 6:42:09 PM , Rating: 2
Hmmm... they have to give a starting date else it's completely dumb. So you're saying they should make it open indefinitely with no cutoff date. Hmm....

RE: Finding Fault
By cochy on 11/29/2007 6:22:15 PM , Rating: 2
Funny that you're the one asking for proof when your entire posts are basically your own suspicions.

I suspect the former, not the latter

So honestly what's wrong with you? lol

RE: Finding Fault
By mindless1 on 11/29/2007 9:14:22 PM , Rating: 2
You're kidding, right?

Suspicion was a term used out of kindness, it would be ridiculous to think Newegg didn't know the terms of the agreement they had with Paypal, that they were informed but apparently somewhere in their internal communication chain the important details didn't get passed along.

Somebody at Newegg goofed bigtime by deciding to advertise an offer based on dates (26th to 28th) when clearly dates had nothing to do with it, the deal could have gone for one hour or 10 months all depending on when the funds ran out.

RE: Finding Fault
By Kenenniah on 11/30/2007 9:13:37 AM , Rating: 2
Umm don't you think the deal could have included both? It would end either when the funds ran out, or on the 28th. Not exactly hard to understand there.

RE: Finding Fault
By mindless1 on 11/30/2007 12:59:14 PM , Rating: 2
The point is still that regardless of what the deal "could've" been, that's not what was advertised. This much is quite clear as evidenced by all the people who placed orders then wondered if they'd get the 20% discount, and those who were planning on placing orders based on the advertised date but didn't get home from work/etc in time to do so.

RE: Finding Fault
By Kenenniah on 12/7/2007 2:45:01 PM , Rating: 2
"This much is quite clear...."
Not to me it isn't. You could be right, but since I didn't actually see the promotion I can't say for sure. But let's face it, the average American consumer really isn't that intelligent. How many of them do you think actually read and understood the terms and conditions? Again since I didn't see the actual promotion I can't say if it mentioned a limit to amount or number of orders or even a simpe "While supplises last". To assume however that it didn't because so many consumers didn't know is giving the average idiot consumer way too much credit.

"I modded down, down, down, and the flames went higher." -- Sven Olsen

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