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Pricing as a Promotional Tool
Promotional pricing is a strategy used by businesses to draw in more buyers and prospects.
The product or service's value rises among customers as a result of this false sense of scarcity.
This may all be done by the brand simply by decreasing the price of its product or service.
Promotional pricing aids in the acquisition of consumers by targeting and encouraging price-conscious customers.
It helps to increase income, gain and retain customer loyalty, and improve short-term cash flow.
The majority of businesses implement promotional pricing through special discounts for early payments, group purchases, & during seasonal buying.

Promotional Pricing – Case Study “Amazon Prime Day’
Amazon Prime Day, a sale event held by Amazon annually, is specifically only for Prime members. It gives discounts on thousands of products across all categories for two successive days.
In 2022, Amazon’s Prime Day 2022 sales reached $12 billion. This was Amazon’s eighth-annual Prime Day, according to an early Digital Commerce 360 analysis.
The sales in 2022 were up 8.1% from the 2021 event. In 2021, Prime Day sales reached $11.19 billion; an increase of 7.7% over Amazon’s 2020 event.
In 2022, shoppers purchased more than 300 million items worldwide, up from 250 million in 2021.

Promotional Pricing – Case Study “Burger King”
Example – The Whopper Reply
Burger King found that customers of McDonalds in Denmark had been leaving messages that were unattended for days, weeks, months and in some cases, even years.
A PR company in Denmark called agency “Uncle Grey” came up with this stunt called “The Whopper Reply."
With this, the customer service agents of Burger King targeted the fans of McDonald's by leaving hilarious and witty answers to the fan's previous comments along with a link that helped redeem a Whooper for free.
Burger King promoted its own customer service’s interest in satisfying its customers through this campaign.
The fast food chain also guaranteed its customers a reply to their queries on Facebook in 48 hours.

Promotional Pricing – Techniques
1. Loyalty Schemes
Customer interaction and purchases are the basis for rewards.
Customers with a greater spending volume receive greater value from their points.
These loyalty systems are occasionally personalized for particular consumers.
High-end businesses such as hotels, insurance companies, and airlines benefit most from tiered loyalty schemes.
Promotional Pricing – Techniques
Starbucks, a company that is well-known for its restaurant operations, reported an increase in revenue generation through its loyalty program during the pandemic.
Did you know; more than half of Starbucks revenue is now driven by rewards customers
In fact, Starbucks Rewards members have accumulated more than $2 billion in rewards.

Special Event Pricing
During certain times of year or seasons, sellers lower their prices or provide discounts in order to attract more consumers.
Special Customer Pricing
The brand gives a particular list of clients or customers special pricing or discounts.

Cash Rebates
Cash rebates given by automobile companies and other consumer-goods businesses encourage the purchase of manufacturers' goods within a set time period. Rebates help to clear inventories while also preventing the hacking of stated list price.
Low Interest Financing
Instead of reducing the price of its products, companies offer low-interest financing. Automakers employed this technique in the past to gain more customers.

Longer Payment Terms
Customers worry more about the cost and affordability of monthly payments in most cases. Customers are less concerned with interest rates than they are with the cost and accessibility of monthly payments.
Customers benefit from loans with lower monthly payments over a longer period of time.

This video is on Pricing as a Promotional Tool and it has the following sub-topics.

Time Stamps

0:00 Introduction to Promotional Pricing
0:16 Pricing as a Promotional Tool
0:50 Promotional Pricing - Case Study
2:12 Promotional Pricing – Techniques