A price promotion is a price reduction offered to every purchaser during a limited period. Price promotions offer a discount to everyone, encouraging customers to try a new product or to buy more of an established product. Promotions can involve lowering prices by a fixed percentage, by a fixed dollar amount, or by providing two or more items for the price of one. H. Refunds and Rebates 1. Refunds take the risk out of trying a new product because the customer may request the return of the price paid for the item.
Rebates are partial refunds offered by retailers of expensive products.
Refunds and rebates temporarily enhance the value of a product. However, rebates can hurt profits when many consumers wait for a promotion rather than pay the normal price. I. Displays 1. In-store promotions are popular ways of communicating with shoppers as they are in the process of deciding what to buy. Displays also satisfy the merchandising needs of channel partners.