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When department stores and supermarkets drop the price on well-known bands to encourage additional store traffic is also known as
Special event pricing
Psychological discounting
Loss-leader pricing
None of the above
A loss leader pricing strategy, a term common in marketing, refers to an aggressive pricing strategy in which a store prices its goods below cost to stimulate sales of other, profitable goods. With such a pricing strategy, a business is selling its goods at a loss to lure customer traffic away from competitors. In contrast to predatory pricing, loss leader pricing is aimed toward stimulating other sales of more profitable goods. For example, consider businesses that use “introductory” pricing for their products and services. Several cable and phone companies offer low rates for their services in an attempt to “capture” the customer and ultimately cross-sell other products and services. Although in this particular example the service may not be priced below cost, the rationale is essentially the same.
By: Barka Mirza ProfileResourcesReport error
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