Jordan's knows cost of victory full well
The Red Sox World Series victory is going to cost Jordan's Furniture millions of dollars, but chief executive Eliot Tatelman says he couldn't be happier.
For customers who bought sofas, dining tables, beds, or mattresses between March 7 and April 16, the furniture store chain promised full refunds if the Red Sox won the World Series. Yesterday, one day after the Sox swept the Colorado Rockies in four games, Jordan's opened a rebate call center and began processing claims.
Tatelman insisted the promotion has been a win-win for everyone, except the insurance company that agreed to cover him in case the Sox won the World Series. He declined to name the insurer.
"From a business point of view, it's been very, very successful," he said. "We got insurance. We're sending our customers back money for things they bought. It couldn't be better."
Tatelman said the good will the promotion has engendered among customers will pay off for years to come. "Some of these people are going to come back with those checks they are getting and buy something else," he said.
Jennifer and Joseph McEachern of Danvers bought two bedroom sets at Jordan's back in April and stand to get back more than $4,000 they spent on beds and mattresses. They paid with a Jordan's credit card that waived payments and interest for a year, so the $4,000 will go to reduce the size of the total bill.
Jennifer McEachern said she and her husband would have bought the furniture anyway, but the promotion added to the excitement of the baseball playoffs and reinforced her image of Jordan's as a high quality store where it's fun to shop.
"Something like this promotion is a fun thing to do," she said.
Tatelman declined to say how much will be paid out under the promotion, but he said customers placed nearly 30,000 orders that would qualify for a rebate. Hypothetically, he said, if the average order was $1,000, that would be $30 million in sales.
Jordan's, which is owned by Omaha-based Berkshire Hathaway Inc., is also trying to figure out if the deal can be sweetened even further. Tatelman said his lawyers are investigating whether the payments to customers are taxable.
Jordan's had planned to report the payments to the Internal Revenue Service and send the customers federal 1099 tax forms, but Tatelman said that may not be necessary.
"It's really a rebate. It's not a prize," Tatelman said, although some critics have argued that the Jordan's promotion is actually an illegal lottery.
Jon Hickey, senior vice president of sports and entertainment marketing at Mullen, a Wenham advertising agency, said the Jordan's promotion was a brilliant use of a team sponsorship. He said Jordan's would have won financially if the Sox had failed to win the World Series, but now it will win a huge public relations bonanza with the victory. He estimated the retailer could have paid several million dollars for the insurance coverage - a small price for the publicity.
"I can't imagine why they wouldn't do it again next year," he said.
Tatelman wouldn't say whether he planned to do the promotion again.
"I would love to do it again, but I don't know if I can," Tatelman said. "What insurance company is going to insure me now?"
Bruce Mohl can be reached at mohl@globe.com. 