Technique for utilizing a computer system to provide price protection to retail customers

A technique for utilizing a computer system to provide price protection to retail customers of a dealer for its least selected goods. Information on each retail transaction for the goods and information on selected goods advertised for sale by others within a selected geographic area are entered into the computer system. The computer system then determines at selected time intervals whether automatic rebates are due to any customers, rebates being due when the computer determines that a product of the selected goods purchased by the customer has been advertised at a lower price by another dealer within the selected time period after the purchase transaction. The computer also prints a check to the customer for the determined difference when it determines that a rebate is due with the check being sent to the customer.

FIELD OF THE INVENTION 
This invention relates to a technique for utilizing a computer to provide 
price protection to retail customers for at least selected goods over a 
selected period. 
BACKGROUND OF THE INVENTION 
Retail customers, particularly for relatively large ticket items such as 
televisions, high-fidelity systems, appliances, cameras and the like, are 
generally concerned when they make a purchase that they are getting the 
best price. This may result in the customer visiting a number of retail 
dealers before making a purchase decision and the customer delaying the 
purchase in the hope that the price of the product will go down so that 
they can obtain a better buy. 
However, for the retailer, once the customer leaves the store without 
making a purchase, there is a very good chance that the sale has been 
lost. Stores have therefore tried to ease the customer's concern that they 
will not obtain the best price by offering various types of price 
protection policies. Typically such policies guarantee the customer that 
if the same product is advertised for sale by another retailer within the 
geographic area where the purchase is being made at a lower price within 
some specified time period, for example thirty (30) to sixty (60) days, 
the customer can obtain a rebate of the difference between the advertised 
and the purchase price by bringing the advertisement and his sales slip to 
the dealer. However, such programs are only marginally attractive to 
potential customers since they require the customer to monitor competitive 
advertisements over the period, something which few customers have the 
time, patience or capability of doing. They also require the customer to 
travel to the dealer, which may be located at some distance from the 
customer, and involve a substantial amount of the customer's time. Saving 
documents is also a problem as is determining if the purchased and 
advertised products are in fact the same from the limited information in 
many advertisements. Therefore, unless the difference in price is 
substantial, customers frequently do not take advantage of such programs. 
A need, therefore, exists for an improved price protection program for 
retail customers which does not require substantial time and effort on the 
part of the customer, yet assures the customer that if the product is 
advertised for a lower price during a specified period after the purchase, 
he will automatically obtain the benefit of such lower advertised price. 
SUMMARY OF THE INVENTION 
Heretofore, the provision of an automatic price protection program for each 
transaction or for at least selected transactions, for example 
transactions for particular classes of goods, or goods having greater than 
a selected price, has been considered to be too time consuming and 
expensive to implement. The applicants have, however, found that by using 
a computer to implement such a program, it can be performed in a 
cost-effective manner. 
Therefore, this invention provides a method and technique for utilizing a 
computer system to provide price protection to retail customers of a 
dealer for at least selected goods. The method involves the steps of: 
a) storing in the computer system information on each retail transaction 
for the goods. Such information should include at least customer 
information such as the customer's name, address, and telephone number, 
product identification information for each product of the selected goods 
involved in the transaction, the date of the transaction and the price 
paid for each identified product; 
b) storing in the computer information on the selected goods advertised for 
sale by others within a selected geographic area. The selected geographic 
area is typically the geographic area in which the store making the sale 
is located, but, for example with catalog sales, may be defined as other 
catalogs for the same products. The stored competitive information may 
include product identification, date of advertisement and advertised 
price. For a preferred implementation, this step is performed by skilled 
personnel who know standard prices being offered by the dealer and only 
store information where the advertised price for the product is lower than 
the dealer's standard price for the same product; 
c) utilizing the computer to determine at selected time intervals whether 
automatic rebates are due to any customers, rebates being due when the 
computer determines that a product of the selected goods purchased by the 
customer has been advertised at a lower price by another within a selected 
time period after the purchase transaction; and 
d) for each rebate which is determined due, printing a check to the 
customer for the difference between the price paid by the customer and the 
lower advertised sale price. The printed check is then mailed to the 
customer, for example by having the customer name and address on the check 
show through an envelope window or through use of a mailing label printed 
by the computer from the stored transaction information. 
Step (c) may include the steps of comparing advertised products stored 
during step (b) against transaction products stored during step (a) to 
find matches and verifying that dates for the advertised product and the 
transaction product are within the selected time period. Step (c) may also 
include the step of comparing the transaction price to the advertised 
price for matching products to determine if the advertised price is less, 
and if so by how much. This step would not be required if only lower 
prices are entered during step (b). Where steps (a), (b) and (c) are 
performed for a plurality of different geographic areas, step (c) could 
also include the step of assuring that the retail transaction and the 
advertised sale are for the same geographic area. This could be 
accomplished for example by performing step (c) separately for each 
geographic area or by including a geographic indication with each entry 
made during steps (a) and (b) and, during step (c), comparing geographic 
indications for products on which a rebate may be due. Step (c) may also 
include the step of determining the lowest advertised price for a selected 
time period for each product entered during step (b). Further, for areas 
where there is a sales tax, step (c) may include the steps of computing 
the sales tax on the difference between the transaction price and 
advertised price and adding the computed sales tax to the determined 
difference to determine the amount to be rebated to the customer. Step (c) 
should also include the step of updating information in the computer 
system on a transaction to reflect any rebate sent to the customer. 
Step (d) may be performed by printing a check each time it is determined 
during step (c) that a rebate is due; however, it is preferable that step 
(c) include the step of storing information on each rebate when it is 
determined that a rebate is due and then utilizing this stored information 
during step (d) to print the checks. 
The foregoing other objects, features and advantages of the invention will 
be apparent from the following more particular description of a preferred 
embodiment of the invention as illustrated in the accompanying drawings.

DETAILED DESCRIPTION 
FIG. 1 shows a computer system 10 of a type which may be utilized in 
practicing the teachings of this invention. The system includes a computer 
or processor 12, a keyboard 14, auxiliary input devices 16 (such as a 
mouse, touch screen, or other input devices known in the art), memory 18, 
which may be divided into active storage elements and bulk storage (such 
as tape or disk), and a variety of output devices which may include a CRT 
or other display 20, one or more printers 22 (which may for example 
include a special check and/or label printer) and other auxiliary outputs 
24 as required. While a single computer system 10 is shown in FIG. 1, two 
or more computer systems may be utilized in practicing the invention with, 
for example, PCs, work stations, or other point-of-sale devices being 
utilized to input and collect information which is then loaded into a main 
processor where rebate calculations may be made. 
FIG. 2 is a general flow diagram of the method or technique of this 
invention. Referring to this figure, information is stored for each sales 
transaction for at least selected goods (step 30). While in some 
situations the program of this invention would be run for all goods being 
sold at each retail location, the program is primarily designed to operate 
for larger ticket items. Thus, transaction information for purposes of 
this invention may be stored only for certain classes of goods, for 
example televisions, VCRs, cameras, various types of high fidelity 
equipment, etc., or may be stored only for products having a sales price 
greater than some predetermined threshold, for example fifty dollars. 
Alternatively, information on all products sold is stored in system 10, as 
would generally be the case for many businesses, but only information for 
the selected goods are utilized in the program of this invention. The 
information stored during step 30 would include, but is by no means 
limited to, the name, address, telephone number, and other selected 
information on the customer making the purchase, the product or products 
sold for the transaction, the price for each product sold, the date of the 
transaction, the manner of payment, sales tax information, the dealer 
location from which the product was purchased, and the like. The 
transaction information may be stored on-line as the information is 
entered by the clerk making the sale, or may be stored off-line, for 
example at the dealer location, and bulk entered into system 10, for 
example at the end of each day. 
During step 32 information is stored in memory 18 of computer 12 on goods 
advertised by others in the selected geographic area or areas. At this 
time, advertisements for the goods are found by manually scanning various 
newspapers, and other publications containing advertisements for each 
geographic area in which retail stores in the program are located, 
scanning relevant catalogs, or the like. While this function may be 
performed by a relatively low-skilled individual who merely keys 
appropriate information into the system each time the individual sees an 
advertisement for the goods, for at least one implementation, the function 
is performed by the buyers or other knowledgeable people in the 
organization of the business running the program who are familiar with the 
prices charged for various products by their organization and only enter 
advertised products and prices of competitors into the system when the 
advertised price for the product is lower than the standard price they are 
charging. While this procedure results in more expensive people being 
involved in the performance of step 32, it simplifies overall procedures 
in that the number of competitive price entries in the system is 
significantly reduced. This significantly reduces the processing time 
required to identify customers entitled to rebates and, as will be 
discussed in greater detail later, eliminates one step from this 
computational operation. The information entered into the system during 
step 32 would include a product identification, the advertised price and 
the dates during which the advertised price is in effect. Where the system 
covers more than one geographic area, the input would also contain a 
suitable indication of geographic area for the advertisement. This could 
be a geographic area code or could be a code indicative of the publication 
from which the advertisement was taken or the dealer offering the lower 
price. 
During step 34 the rebate routine is run. While this routine may be run 
daily, typically it is run at much less frequent intervals. Examples of 
times at which the rebate routine might be run include once a week, 
biweekly, and once a month. The routine can be run at off hours when the 
computer is being underutilized and need not necessarily be run at regular 
intervals or at the same time each week or month. 
Referring to FIG. 3, which is a flow diagram of the rebate routine, it is 
seen that the first step in this operation, step 40, is to determine for 
each advertised product stored in the system the lowest advertised price 
for the product during the selected period. Where the system covers two or 
more geographic areas, a lowest advertised price could be determined for 
each geographic area. Step 40 may be performed by finding an advertised 
product, storing the advertised price for the product and then scanning 
the listing of stored advertised products to find any other listings for 
the same product. For each other listing found, the price for such listing 
is compared with the stored price and the price for such listing is stored 
in lieu of the store price if it is lower. This procedure could be 
repeated for each product for each geographic area being covered. 
Once lowest advertised prices are determined, the operation proceeds to 
step 42 where a particular advertised product is selected and a 
determination is made by scanning sales transactions during the preceding 
period whether there have been any sales transactions for the selected 
advertised product. Assuming, for example, that the price guarantee is 
good for thirty days and that the rebate routine is run once a week, the 
routine would be looking each week at sales transactions which became 
thirty days old during the preceding week and at advertised prices for the 
preceding thirty day period. If during step 42, no match is found on a 
given sales transaction, the operation proceeds to step 44 to determine if 
there are more sales transactions to look at. If there are more sales 
transactions to look at, the sales transaction looked at is incremented 
during step 46 and step 42 is repeated for the next sales transaction. 
When during step 42 a match is found between the selected advertised 
product and a product sold for the sales transaction, the operation 
proceeds to step 48 during which a determination is made as to whether 
both the transaction and the advertisement are within the selected time 
period. Thus, if the routine were being run on April 15th and the 
advertisement started to run on April 13th, there would be a "YES" output 
during step 48 if the transaction occurred on March 14th, but there would 
be a "NO" output during step 48 if the transaction occurred on March 12. A 
"NO" output during step 48 results in step 44 being performed to cause the 
next transaction to be looked at. 
A "YES" output during step 48 either causes optional step 50 to be 
performed or causes a branch to step 52. If step 32 is performed in the 
manner discussed above for one implementation where advertised products 
and prices are entered into the system by knowledgable personnel who only 
make such entries when the advertised price is less than the standard 
price of the product for the dealer running the program, then all that 
would be required during step 50 would be to determine the actual price 
difference. However, if all advertised prices for the class of goods of 
which rebates are being given are entered into the system, then during 
step 50 a determination is made as to whether the advertised price for the 
product is less than the price paid by the customer for the transaction 
being looked at. If the price is not less, the operation returns to step 
44 to cause the next transaction to be looked at. If the price is less, 
the price difference is determined and the operation proceeds to step 52 
to compute the sales tax (assuming the geographic area has a sales tax) on 
the determined price difference and to add the determined sales tax to the 
price difference to get the amount to be rebated. 
During step 54, information on the rebate to be given to the customer is 
stored in an appropriate area of, for example, memory 18. This information 
would include the name and address of the customer, the amount of the 
rebate check and any other information which it is desired to print on the 
rebate check or to provide to the customer in a letter accompanying the 
rebate check. For example, a form letter may be sent with the rebate check 
which informs the customer of the product on which the rebate is being 
given and the company policy which resulted in the rebate, or such 
information may be printed on the check. 
The operation then proceeds to step 58 to update the customer transaction 
record or records. This assures that the dealer has a record of the rebate 
so that the rebate is deducted in the event a refund is subsequently given 
to the customer on the product. It also adjusts sales figures for purposes 
such as paying sales tax, determining profits, determining mall lease 
payments which may be based on sales from a store, determining salesmen 
commissions or other purposes. 
Once step 58 has been completed, the operation returns to step 44 to look 
at the next transaction. The process described above continues with 
successive transactions during the selected time period being compared 
against the selected advertised product until, during step 44, it is 
determined that all relevant transactions have been looked at. When that 
occurs, the operation branches to step 60 to determine if there are more 
advertised products to be looked at. If a "YES" output is obtained during 
step 60, the operation advances to the next advertised product during step 
62 and the operation then returns to step 42 to compare the new selected 
advertised product against the products of sales transactions during the 
preceding selected time period. This process is repeated until all 
transactions have been compared against the new selected advertised 
product, at which time the operation again branches to step 60 to 
determine if there are more advertised products to be looked at. This 
process continues until, during step 60, a "NO" output is obtained, 
meaning that all stored advertised products have been compared against 
relevant transactions. At this time the rebate routine is complete and the 
operation exits from rebate routine. 
Referring again to FIG. 2, it is seen that when the rebate routine step 34 
is completed, the operation proceeds to step 70 to print rebate checks 
utilizing the information stored during step 56. While checks could be 
printed in lieu of storing the information during step 56, it has been 
found to be faster and more efficient to store the information during the 
rebate routine and to print the checks in bulk during step 70 rather than 
to print the checks each time a determination is made that a rebate check 
is required during the running of the rebate routine. During step 70 the 
information stored during step 56 is looked at in sequence and is utilized 
to print the checks to customers in a standard fashion. A printer such as 
printer 22 may be utilized for this purpose. 
For a preferred embodiment, the checks are mailed in an envelope having a 
transparent window which shows the customer's name and address so that 
printing labels are not required. However, if it is desired not to use 
envelopes having transparent windows, the information on customer name and 
address stored during step 56 may also be utilized to print mailing labels 
during step 72 or to print customer name and address information directly 
on the envelope. The envelope would also typically contain additional 
legends advising the customer that a check is contained in the envelope 
rather than junk mail so that the envelope does not get thrown out 
unopened. 
A procedure is thus provided for utilizing a computer system to 
automatically provide rebate checks to a customer in the event a product 
purchased by the customer from the dealer is advertised for sale at a 
lower price by another within the geographic area during a selected time 
period after the sale. The customer does not need to scan newspapers and 
other publications to see if the product is being offered at a lower price 
by others, does not have to return to the store with a sales slip, and 
does not have to worry that he has paid more than he needed to pay. The 
customer is assured that with no action on his part he will receive the 
benefit of any lower price advertised by any other dealer in the 
geographic area for the selected time period. 
While the invention has been described above with respect to a preferred 
embodiment, it is apparent that in addition to the variations which have 
been discussed above, other variations are also possible. Thus, while it 
is believed preferable to compare the advertised products against the 
sales transactions since there will typically be a far lesser number of 
advertised products, particularly if such products are screened by 
knowledgeable personnel so that only advertised products offered a lower 
price are actually entered into the system, then there will be 
transactions during the time period. However, the invention can also be 
practiced by matching each transaction product against the stored 
advertised products. Further, while a step to determine if the geographic 
area for the transaction and for the advertised product are the same is 
not shown in FIG. 3, where advertised products for several geographic 
areas are stored in system 10, this step may be required. Alternatively, 
the rebate routine could be run separately for each geographic area. 
Further, while for the preferred embodiment a determination is made only 
at the end of the selected period, for example at the end of thirty days 
after the transaction, whether a rebate is due, it is possible that each 
transaction could be looked at during the thirty day period and a rebate 
check given if appropriate at any time during such period. The rebate 
given would then be subtracted from the price paid to determine a new 
effective price which would then be used for subsequent comparisons to 
determine if the customer might be eligible for an additional rebate. 
However, it is believed preferable not to incur the additional 
administrative expense of providing multiple rebates. 
Thus, while the invention has been particularly shown and described above 
with reference to a preferred embodiment, the foregoing and other changes 
in form and detail may be made therein by one skilled in the art without 
departing from the spirit and scope of the invention.