Handbook of Research on Retailing
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Handbook of Research on Retailing

Edited by Katrijn Gielens and Els Gijsbrechts

The advent of e-commerce and the rise of hard discounters have put severe pressure on traditional retail chains. Boundaries are blurring: traditional brick & mortar players are expanding their online operations and/or setting up their own discount banners, while the power houses of online retail are going physical, and hard discounters get caught up in the Wheel of Retailing. Even successful companies cannot sit back and rest, but need to prepare for the next wave of change. In the face of this complexity, it is all the more important to take stock of current knowledge, based on insights and experience from leading scholars in the field. What do we know from extant studies, and what are the ensuing best practices? What evolutions are ahead, and will current recipes still work in the future? This Handbook sheds light on these issues.
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Chapter 4: Retailer promotions

Karen Gedenk

Abstract

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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