MS Accused of Bait and Switch, Negative Cashback Rewards

For the past few months, Samir Meghani has been the proverbial "thorn in the side" of Microsoft. First, the co-founder of price comparison search engine Bountii.com posted ways in which users could exploit the Bing cashback rewards program. Now, Meghani is claiming that this same promotion is responsible for making some products appear more expensive on the web than their actual retail price.

Bing 'Negative Cashback' Rewards

Acccording to Meghani, Bing has a hidden feature that  he refers to as 'negative cashback'. It is his belief that the program, and more specifically, vendors associated with the program, are offering spiked prices instead of figures that represent the true value of the products being sold.

In a nutshell, Bing cashback is a search marketing program that provides a cash rebate credit for the purchase of certain items discovered through search. The program allows merchants to specify the amount of promotional funds paid to Microsoft as a type of sales commission agreement. Microsoft, which operates the program in the promotion of Bing as a search platform, then passes 100% of the commission to shoppers after a 60-day waiting period. (Source: informationweek.com)

However, a recent visit to butterflyphoto.com was all the proof Meghani needed to expose the program as a "bait and switch" tactic.

Bait and Switch Tactic

In a recent Internet post, Meghani stated "If I go directly to butterflyphoto.com, I pay $699 with 0% cashback for a new Canon Vixia HV40 camcorder. If I use Bing Cashback, I pay $758 with 2% cashback (bringing the total to $742.84). Bing cashback has actually cost me $43.84, giving an effective cashback rate of -6.27%. Yes, negative cashback! Is this legal? False advertising? I don't know, but it's pretty sketchy."

Meghani is also quite outspoken about his reason for the continued existence of negative cashback. He points to a web browser cookie that "taints" his browser. Since Meghani followed a Bing link to Butterfly Photo, he believes that the site implants a cookie identifying Bing as the referring site. The cookie, he says, lasts three months and will ensure that he is presented with the higher Bing price during subsequent visits to Butterfly Photo while the cookie is active.

Microsoft Weighs In

Naturally, Microsoft weighed in on the issue in defense of their cashback program, saying, "Within the cashback program, each retailer sets the allocation of products and pricing of those products, which are then delivered to Microsoft through a realtime data feed. We have tools that will catch discrepancies, and in this particular case, there was an error in the information delivered to us." (Source: informationweek.com)

Whether Microsoft is being sincere or was caught with their hand in the 'cookie' jar is cause for further debate.