Gift-with purchase programs can be very effective, but can also be expensive and cumbersome to administer. So it can be very attractive when a third party offers to take care of all the fulfillment details.

The downside is that if the third party screws up, it’s your reputation that suffers.

According to the Oregonian, La-Z Boy Furniture Galleries offered $250 in gas rebates with a qualifying purchase. The rebates were to be handled by a Florida company. About 700 customers took advantage of the offer last summer, and at least 100 complained that they didn’t get their rebates.

On Feb. 12, the Florida Attorney General sued the gas redemption company for unfair and deceptive business practices. The company operates under a variety of names and Web sites, including Tidewater Marketing Global Consultants, though Portland-area customers likely would recognize the addresses used in a handful of local retailer and marketing offers, including the La-Z-Boy deal, as FreeGasCentral.com or GasolineRedemption.com.

Although the store had contracted with the Florida company in good faith, customers held La-Z Boy Furniture Gallery responsible when they didn’t get what they were promised. And to their credit, the store has accepted that responsibility.

Although the deal worked for some customers, [Regional Sales Manager Mark] Yohn said, La-Z-Boy has taken over the reimbursement program.

Customers who haven’t had luck redeeming their gas receipts can contact any of the six Portland-area stores. La-Z-Boy also will refund the $5 customers spent to get the program started, he said, and reimburse those customers’ gas receipts as they are mailed in.

So the story ends well for La-Z Boy customers. It’s likely an expensive lesson for the store: whenever you’re approached by a third party for a promotion, check ’em out carefully.

A side note for Portland businesses — the state of Oregon amended several consumer protection rules about a year ago, and now tightly restricts the circumstances under which you can offer a gift with purchase.

It’s called the “Free Rule”, and I’ve got a copy of it at my desk. You might be surprised at what’s legal in Oregon and what’s not — email me here and I’ll be happy to send you a copy.

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