This invention relates generally to systems for issuing consumer promotions, usually in the form of coupons or certificates, in response to the purchase of preselected items in a retail store, or simply when a customer purchases one of the promotions. More specifically, the invention relates to systems for issuing promotions or certificates of the type that requires a unique personal identification number (PIN) to be conveyed to a customer receiving the item. PINs are printed or encoded on valuable certificates awarded to customers and subject to redemption for various promotional and marketing purposes. Each certificate must be resistant to fraud and must be secure from duplication. Therefore, each certificate's PIN number must be unique and, in general must be generated randomly. Having random but valid unique numbers requires the creation and storage of the numbers in databases. The administration of such a database becomes very time consuming, expensive and difficult. Therefore, there is a need for a PIN generation technique that eliminates the requirement for creating and maintaining a valid PIN database.
More specifically, the present invention relates to the awarding of property, goods, services, or rights, at the point-of-sale, based on certain criteria which can be measured at the point-of-sale, and where the authenticity of the award can be verified at the time of redemption with the use of a code that need not be established prior to the award. While the invention will be described mainly in connection with the awarding of free long distance telephone service, it is to be understood that the principles of the invention are also applicable to providing any award, at the point-of-sale, where the subsequent verification of the award can be accomplished without the need for a pre-established list of valid authorization codes.
A marketing technique that has enjoyed increasing popularity is the awarding, at the point-of-sale, of a free product or service as an incentive to purchase other products or services. Typical marketing programs offer 5 or 10 minutes of long distance service as incentives to purchasing the sponsoring company's product, as potential prizes for participating in a marketing contest, or as premiums offered under a retailer's frequent shopper loyalty program, or simply as a product for purchase. With respect to marketing long distance telephone service, there are generally two methods employed. One method entails the registration of the consumer and the issuance of a telephone "credit card" for which an account is established and is later credited with certain dollar amounts of telephone service based on the consumer's actions or purchases. Another method is to issue telephone "debit cards" to each consumer meeting the requirements of the particular marketing program. These debit cards are generally pre-authorized in 5 or 10 minute denominations. The issuance of a debit card does not establish an account, but rather is authorized for the specified amount of telephone service and then becomes useless after the telephone time is exhausted. With both methods, the consumer is usually required to dial a toll-free number and provide a personal identification number (PIN) in order to activate the free service. This PIN must be randomly generated prior to the issuance of the telephone credit/debit card so that verification of valid usage can be established prior to granting the free service.
With each of the processes described above, there is a requirement that a physical card (similar to a consumer credit card) be issued to the consumer. The manufacture and delivery of these cards represents a significant expense and therefore can be cost prohibitive in many circumstances. In addition, there are security concerns inherent in the manufacture and delivery of the cards since someone other than the intended user could easily convert them for their own use (especially in the case of the debit card since the PIN is generally pre-printed on the card itself). Another limitation of the current methods of marketing telephone cards is the fact that the account and/or a PIN must be generated prior to the issuance of a card. This can result in a time lag from the time the consumer complies with the offer and the time at which the telephone service is available (especially with respect to the credit card method). This limitation can also cause shortages or excess inventories of cards based on consumer demand (especially with respect to the debit card method).
Regardless of whether a certificate or award is presented to a consumer as an incentive to purchase selected products or simply in response to a request to purchase the service that the certificate provides, the difficulties described above have inhibited safe and efficient distribution of such certificates. The following paragraphs discuss the problems that apply specifically to the distribution of prepaid service certificates, such as prepaid long-distance calling cards.
Problems first arise at the manufacturing stage. Cards are typically preprinted with the value in dollars or the time in minutes, in preset amounts, even though the consumer may prefer to have a different value or time. Moreover, preprinted cards have the further limitation that they contain fixed important information, such as an "800" toll-free number for accessing the service. Access numbers may become overloaded and cause inconvenient delays for the user and new access numbers may have to be added to meet demand, but there is no convenient way to update this information on a pre-printed card. Similarly, each preprinted card has a PIN (personal identification number) that must be used to activate the card, i.e., turn it on for use. The preprinting of PINs on the card exposes the value of the card to anonymous and usually untraceable theft. Once the card is printed, its value can be stolen without physically taking the card itself. The theft can take place anywhere from the printing source to the retail outlet. It will be apparent that sending these "live" cards through a supply and distribution process is fraught with security risks. The special handling adds to the cost and difficulty of marketing and selling remote value cards. Unsuspecting consumers may purchase cards that are either depleted or being used by others purchased illegally. The merchandising and sales of tamper resistant cards adds to the cost and effort for everyone. Live cards with protected PINs must be treated as a near-cash item through the distribution and retailing process. As a delivery of cards is made to a store, if it is not kept under lock and key or in the cash drawer it may be easily stolen, lost or misplaced. The cards themselves are very small and easily concealed by unscrupulous employees or shoppers. Therefore, suppliers and retailers of these cards are exposed to a very large financial risk in handling the cards. If the value is taken illegally from a card, it is not possible for the retailer to accept the return or bill back the supplier.
One solution is to distribute "dead" cards instead of "live" ones. A dead card is one that has a PIN that must be activated by the retailer before distribution to the consumer. Activating preset PINs is very expensive, time consuming and error prone. Distributing dead cards with PINs that require activation is, therefore, inconvenient and is still prone to theft and misuse because some card suppliers preprint and assign the PINs in a uniform, predictable or unprotected manner. Dishonest persons may dial the access number and enter PINs until they successfully access the service, or may look for a pattern in multiple PINs, and then resell the PIN and access numbers to different users. Another potential problem is that some PIN sequences are purposely short, for the convenience of the user. This creates a dangerous situation, since a computer dialer can more easily pick and decipher short PINs that are not encoded.
Another proposed solution to the security problem is to use scratch-off coatings and removable tape covers over the PINs. This has a limited effect because the "live" and valuable cards can still be stolen and used anonymously by dishonest persons, anywhere through the supply chain.
Systems have been proposed in which prepaid cards are sold without a PIN. The PIN is activated or attached to the card after is a call is made to a central computer that issues PINs. In some systems of this type PINs may be downloaded in a batch, and then held until a card is purchased, at which time a PIN is attached to the preprinted portion of the card. The principal limitation of this method is that a call must be made to a central computer to issue a PIN. This slows the down the transaction and, in a retail environment, slows down the cashier while the computer is dialed and the PIN is issued. Further, a dishonest or inattentive cashier could sell or give away the value of the PINs.
Some prepaid telephone cards are sold or vended in enclosed plastic containers placed in a store display rack. The cashier selling such cards typically scans a bar code on the display itself, and a PIN is obtained by placing a call to the service provider. This bar-coded activation method fails to prevent fraud or misuse by others as the bar codes can be duplicated and used on more than one card. A thief could steal one or more cards and purchase one to obtain the valid batch code, thus activating the stolen cards as well.
It will be appreciated from the foregoing that prior art techniques for distributing certificates or cards redeemable for a valuable service all have practical difficulties that render the certificates or cards both inconvenient to the consumer and vulnerable to fraud or theft. There is a need for a new approach for distributing such certificates or cards in a convenient manner without compromising the security of the valuable services that are obtained by use of the cards. The present invention satisfies this need, as briefly described in the following summary of the invention.
USPTO Backgrounds
USPTO Backgrounds