Specifying Terms and Conditions of Product Promotions

This task is a step in Process of Creating Product Promotions.

Some promotions require customers to accept certain terms and conditions. In some industries, these are called commitments. If your promotion includes terms and conditions, then you must specify them.

For example, if a customer accepts a promotion offering a free cell phone to sign up for a certain mobile plan, then the customer may have to keep that mobile service for at least a year. If the customer cancels the service before the year has ended, then there may be a penalty.

When a customer disconnects an asset, the Siebel application checks to see whether the customer is breaking the terms and conditions of a promotion. If so, it displays a warning message telling the customer how much the penalty is. You can set up the product recommendation engine to recommend changes that will avoid the penalty, as described in the topic about recommendations in Siebel Order Management Guide. If there is a penalty, then the application calculates the amount. The Siebel application is integrated with the billing application, so the penalty is automatically applied.

You may want to prorate the penalty. For example, if customers get a free satellite dish when they sign up for twelve months of service, then they may have to pay the full penalty if they cancel before one month has elapsed, but pay only one-half of the penalty if they cancel after six months. For more information on proration, and defining conditional charge plans for agreement line items, see Siebel Field Service Guide.

A commitment may include recurring credit and cancellation charges. The cancellation charge and credits may need to be prorated for partial periods.

The penalty may be a nonrecurring charge paid once, or it may be a recurring charge paid periodically during a specified time period.

You can use the Commitments view to give customers ongoing benefits that they receive with a promotion, in addition to using it for penalties. For example, if the promotion gives the customer a credit every month for a year, which reduces the customer’s monthly bill, then the Commitments view can record this credit.