The value of promotions

Recently I bought two promotional razor packs from Schick containing 6 blades and a razor for R59 each. I was obviously thrilled about a great deal on a great product, but was left asking what the impact would be further down the line?
What is the true value of a promotion? For the retailer, they get to promote their super low prices (often at the manufacturer's expense). For the manufacturer, he has a short term boost in turnover and may gain a significant market share. The obvious winners however, are consumers who grab at the opportunity to save a buck. This all seems great, but what about the negative consequences after the promotion ends?
After purchasing my two promotional packs, I am effectively out of the razor market for about a year, as are many others consumers. This creates an erratic demand that is difficult and expensive for both retailers and manufacturers to manage. Wal-Mart doesn't do promotions - they say you get the best prices in their stores each and every day. It seems to work for them - is this perhaps the cheaper and easier way to retail?

I don't know. If you know, or have any thoughts on the matter, please feel free to e-mail me on craig@fastmoving.co.za.

Craig Ballantyne
craig@fastmoving.co.za

Please feel free to make comments or raise new issues by emailing the editor
editor@fastmoving.co.za

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