Edited by Katrijn Gielens and Els Gijsbrechts
Chapter 4: Retailer promotions
Retailer promotions are sales promotions that retailers offer to consumers. They include price promotions, like temporary price reductions (TPR) and coupons, as well as non-price promotions, like features and displays. The effectiveness of retailer promotions is interesting to both retailers and manufacturers. At the same time, the use of retailer promotions is not trivial. While they typically increase sales quickly and strongly, they come at high costs, especially when price promotions reduce margins, so that the profitability of promotions for retailers is not obvious. This chapter provides a summary of what is known about retailer promotions. It describes instruments available for retailer promotions, discusses how promotions work, and presents empirical findings on promotion effectiveness. Even though research on retailer promotions to date has already produced many results, the chapter identifies still open questions that wait to be answered.
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