# Columbia House record/tape club - what did they do with the pennies? **URL:** \ **Category:** Factual Questions\ **Created:** [February 15, 2007, 6:52pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369 "2007-02-15T18:52:42Z")\ **Posts on this page:** 19\ **Page:** 1
**Author:** ![neutron\_star](https://avatars.discourse-cdn.com/v4/letter/n/51bf81/32.png) [@neutron\_star](https://boards.straightdope.com/u/neutron_star)\ **Post date:** [February 15, 2007, 6:52pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/1 "2007-02-15T18:52:42Z")
Remember the old “7 cassettes for a penny” (or was it 11?) thing? Columbia House would place ads in _Parade_ and other highly circulated publications that had a little outline of a penny so you could tape yours on and mail it in. Now, if the deal was 7 tapes for ten bucks or something, I could understand them doing whatever labor or paperwork was involved in handling the financial side of things, but a gimmick penny? Seems like it would be more trouble than it was worth, but then it’s still technically a cash transaction, right? Did they just pull them off the paper, toss them in a bucket, and haul it into the bank at the end of the week? Did they even go to the trouble of pulling the tape off the pennies for that pittance? ---
**Author:** ![Mr.Moto](https://avatars.discourse-cdn.com/v4/letter/m/9de0a6/32.png) [@Mr.Moto](https://boards.straightdope.com/u/Mr.Moto)\ **Post date:** [February 15, 2007, 7:04pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/2 "2007-02-15T19:04:42Z")
Typically orders like this are handled by a lockbox operation that is already part of a bank. I used to work for one at Mellon Bank in Pittsburgh as a temp. In this case, not only would the bank process the accounts and send the company the new members data in a form that they could easily use for their mail, they’d cash those pennies (or other payments) and regularly transfer Columbia House their value via wire. They’d bill Columbia House for this service, of course, and they’d also make money on interest payments on this money before the wire transfer. ---
**Author:** ![Harmonious\_Discord](https://avatars.discourse-cdn.com/v4/letter/h/74df32/32.png) [@Harmonious\_Discord](https://boards.straightdope.com/u/Harmonious_Discord)\ **Post date:** [February 15, 2007, 9:08pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/3 "2007-02-15T21:08:46Z")
Didn’t sending a penny make the contract more enforcable in the court system later on? They could say you made the first payment on the transaction which indicated acceptance of the terms, and you owe the balance of the contracted amount. You may not have read the terms, so here’s the quick explanation. You had to buy at least so many tapes within two years at regular high prices. ---
**Author:** ![Exapno\_Mapcase](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/exapno_mapcase/32/1051_2.png) [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)\ **Post date:** [February 15, 2007, 9:16pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/4 "2007-02-15T21:16:27Z")
It also sorted out those who were motivated enough to go through the trouble of attaching the penny. Sounds like a minor thing, but marketers firmly believe that putting any kind of a cost to a transaction gets a longer-term commitment than a free offer. ---
**Author:** ![Seven](https://avatars.discourse-cdn.com/v4/letter/s/3d9bf3/32.png) [@Seven](https://boards.straightdope.com/u/Seven)\ **Post date:** [February 15, 2007, 9:39pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/5 "2007-02-15T21:39:36Z")
I sent mine in without a penny and received my records. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 15, 2007, 9:42pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/6 "2007-02-15T21:42:23Z")
[QUOTE=Harmonious Discord] Didn’t sending a penny make the contract more enforcable in the court system later on? They could say you made the first payment on the transaction which indicated acceptance of the terms, and you owe the balance of the contracted amount. [/QUOTE] Nope. When you signed the application contract, you formed a binding bilateral contract. Enforceability wouldn’t be problem, although some jurisdictions may impose restrictions on this type of contract. Actually having looked at the current Columbia House website ( [http://dvd-movies.columbiahouse.com/membership-details;jsessionid=b5272\_mS2yId;jsessionid=b5272\_mS2yId](http://dvd-movies.columbiahouse.com/membership-details;jsessionid=b5272_mS2yId;jsessionid=b5272_mS2yId)) I’m reminded that it was actually a bit more convoluted than that. You ordered the goods (for the penny), if you changed your mind, you had ten days to return them (and I think you had to pay for postage). If you didn’t return them, you were in the club. Then you had to make a certain number of selections within a given period of time. They’d send you a mailer every month that showed their “selection.” If you didn’t send the card back with some other selection, they’d send you theirs. Despite the complications, it’s still a bilateral contract. You agreed to join the club subject to a power to terminate the contract within 10 days. If you didn’t exercise the power to terminate, you were bound by the contract. ---
**Author:** ![KGS](https://avatars.discourse-cdn.com/v4/letter/k/90ced4/32.png) [@KGS](https://boards.straightdope.com/u/KGS)\ **Post date:** [February 15, 2007, 10:27pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/7 "2007-02-15T22:27:03Z")
Ah, Columbia House. I used to scam them all the time by sending in a Change Of Address card after the first seven albums. Their bookkeeping method wasn’t so great back then – they would dispose of the old address long before they realized the new one wasn’t any good. By then, I’d re-applied under a different name. I’m positive this wouldn’t work today, though. 🆒 ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 15, 2007, 10:34pm UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/8 "2007-02-15T22:34:06Z")
[QUOTE=KGS] I’m positive this wouldn’t work today, though. 🆒 [/QUOTE] And of course, if it did . . . [http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=6th&navby=case&no=960018p](http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=6th&navby=case&no=960018p) ---
**Author:** ![Harmonious\_Discord](https://avatars.discourse-cdn.com/v4/letter/h/74df32/32.png) [@Harmonious\_Discord](https://boards.straightdope.com/u/Harmonious_Discord)\ **Post date:** [February 16, 2007, 12:40am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/9 "2007-02-16T00:40:27Z")
I knew if I said think, a person would answer that aspect. Thanks Gfactor. Remember those magizines that you decided to not renew, that came for a year after you didn’t extend the subscription. I never worried about stopping them, because that was definitely one of the ways some companies tried to extend the subscription. They hoped to guilt you into paying. I sent the deliquent payment notice back only once per magazine, with the notation “I didn’t renew and I dare you to produce a signed renewal card.” ---
**Author:** ![Si\_Amigo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/si_amigo/32/2877_2.png) [@Si\_Amigo](https://boards.straightdope.com/u/Si_Amigo)\ **Post date:** [February 16, 2007, 1:02am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/10 "2007-02-16T01:02:20Z")
But the OP asked what they did they do with with the pennies? Did they just throw them away? Did the burn away the paper and deposit the pennies? ---
**Author:** ![Si\_Amigo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/si_amigo/32/2877_2.png) [@Si\_Amigo](https://boards.straightdope.com/u/Si_Amigo)\ **Post date:** [February 16, 2007, 1:08am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/11 "2007-02-16T01:08:48Z")
Oops, looks Mr. Moto kind of answered the OP, But what how did Mellon do with the pennies? Was it just a loss leader? Where did those pennies end up I think was the question. ---
**Author:** ![Mr.Moto](https://avatars.discourse-cdn.com/v4/letter/m/9de0a6/32.png) [@Mr.Moto](https://boards.straightdope.com/u/Mr.Moto)\ **Post date:** [February 16, 2007, 1:41am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/12 "2007-02-16T01:41:16Z")
I don’t know specifically. When I worked for Mellon we were mostly handling IRS and BATF tax payments. I do know, though, that if we were handling that account, we wouldn’t just leave those pennies around. Legal tender is legal tender. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 16, 2007, 1:50am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/13 "2007-02-16T01:50:01Z")
[QUOTE=Si Amigo] Was it just a loss leader? [/QUOTE] According to this ( [http://www.dmnews.com/cms/dm-opinion/editorials/32804.html](http://www.dmnews.com/cms/dm-opinion/editorials/32804.html) ) it was pretty much that. > [@](#): > > Columbia House changed its original offer of 10 records for $1.99 plus free shipping and handling to 10 records for a penny, plus $1.98 shipping and handling, and saw its response rate jump 30 percent. _And see_, [http://marketingbestpractices.typepad.com/marketing\_best\_practices\_/2005/06/index.html](http://marketingbestpractices.typepad.com/marketing_best_practices_/2005/06/index.html) According to this ( [http://www.dmnews.com/cms/dm-opinion/editorials/33054.html](http://www.dmnews.com/cms/dm-opinion/editorials/33054.html) ) Readers diges did it first. And let’s not forget that gold box: > [@](#): > > It turns out that we have the father of direct marketing to thank for Columbia House’s get-12-albums-for-a-penny offer. Unsure of who came up with this promotion, I asked for help from readers last week — and several of you pointed me toward Lester Wunderman. Though Lester couldn’t remember exactly who came up with the idea and, therefore, didn’t want to take credit for it personally, he said it probably was conceived during a brainstorming session between his agency, then Wunderman Ricotta & Kline, and executives at Columbia House. Lester wrote about his longtime association with the Columbia LP Record Club account in his book “Being Direct,” specifically how he came up with the gold box promotion — using “buried treasure” in the record company’s advertising to offer a free record to customers who knew to fill it in. The partnership proved quite fruitful for both. [http://www.dmnews.com/cms/dm-opinion/editorials/32890.html](http://www.dmnews.com/cms/dm-opinion/editorials/32890.html) ---
**Author:** ![Sapo](https://avatars.discourse-cdn.com/v4/letter/s/ec9cab/32.png) [@Sapo](https://boards.straightdope.com/u/Sapo)\ **Post date:** [February 16, 2007, 2:53am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/14 "2007-02-16T02:53:05Z")
Isn’t mailing cash illegal? ---
**Author:** ![Si\_Amigo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/si_amigo/32/2877_2.png) [@Si\_Amigo](https://boards.straightdope.com/u/Si_Amigo)\ **Post date:** [February 16, 2007, 3:05am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/15 "2007-02-16T03:05:38Z")
No, just not too bright. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 16, 2007, 3:06am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/16 "2007-02-16T03:06:00Z")
[QUOTE=Sapo] Isn’t mailing cash illegal? [/QUOTE] Why would you think it was? Nonmailable matter: [http://pe.usps.gov/Archive/HTML/DMMArchive0810/C021.htm#Ran16094](http://pe.usps.gov/Archive/HTML/DMMArchive0810/C021.htm#Ran16094) ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 16, 2007, 3:13am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/17 "2007-02-16T03:13:03Z")
Oops here’s the current DMM version: [600 Basic Standards for All Mailing Services | Postal Explorer](http://pe.usps.com/text/dmm300/601.htm#wp1103548) ---
**Author:** ![Sapo](https://avatars.discourse-cdn.com/v4/letter/s/ec9cab/32.png) [@Sapo](https://boards.straightdope.com/u/Sapo)\ **Post date:** [February 16, 2007, 3:17am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/18 "2007-02-16T03:17:21Z")
[QUOTE=Gfactor] Why would you think it was? Nonmailable matter: [http://pe.usps.gov/Archive/HTML/DMMArchive0810/C021.htm#Ran16094](http://pe.usps.gov/Archive/HTML/DMMArchive0810/C021.htm#Ran16094) [/QUOTE] Just asked my postal wife. Turns out they are in the habit of telling people it is a felony, even though it is perfectly legal (although not too smart) and even the USPS website says so. I am not terribly sure why they do that. At this point, it is probably tradition. As to how it started, let’s wait for someone in the know. Might even start a thread on it, if we don’t get a good answer quick. Sooooo, just me perpetuating another urban legend :smack: . As you were. ADDED: spooky thing. My quote shows your edited post, even if I quoted you before you edited. Tricky, tricky, tricky. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [February 16, 2007, 3:24am UTC](https://boards.straightdope.com/t/columbia-house-record-tape-club-what-did-they-do-with-the-pennies/392369/19 "2007-02-16T03:24:29Z")
[QUOTE=Sapo] Just asked my postal wife. Turns out they are in the habit of telling people it is a felony, [/QUOTE] Hmmm. Never heard it, so I guess I’m no help. > [@](#): > > ADDED: spooky thing. My quote shows your edited post, even if I quoted you before you edited. Tricky, tricky, tricky. :eek: