Explanation:

Promotional pricing is a sales strategy in which brands temporarily reduce the price of a product or service to attract prospects and customers. By lowering the price for a short time, a brand artificially increases the value of a product or service by creating a sense of scarcity. Promotional pricing can help with customer acquisition by encouraging cost-conscious shoppers to buy. It can increase revenue, build customer loyalty, and improve short-term cash flow.

A promotional pricing strategy works best in the short-term. Used excessively, it costs brands money by eroding profit margins. Customers become accustomed to lower pricing—so-called “price orientation”—or they may stock up during the promotional period. It also adds to the noise in an already-crowded marketplace where promotions and discounts are commonly used.