To read the full version of this content please select one of the options below:

Assessing the impact of a very successful price promotion on brand, category and competitor sales

John Dawes (Senior Research Associate based at Marketing Science Centre, University of South Australia, Adelaide, South Australia, Australia)

Journal of Product & Brand Management

ISSN: 1061-0421

Article publication date: 1 August 2004

Abstract

Many studies have examined the short‐term and long‐term effects of price promotions. This study adds to previous research by examining, in some depth, the effects of a massively successful price promotion in a consumer goods category. This study sought to determine if this large price promotion had any: longer‐term effect on brand volume; short‐term effect on total category volume for the retailer; short‐term effect on competing retailers; and longer‐term effect on category sales for the retailer that ran the promotion. The results showed that this promotion did not have any longer‐term (positive or negative) effect on the brand, but it did expand the total category for the retailer, albeit temporarily. Sales dropped slightly for one competing retailer at the time of the promotion, but not for the other two retailers in the market. Finally, the study found that the promotion was followed by a decline in total category volume for the retailer, suggesting some degree of purchase acceleration or stockpiling by consumers. The results suggest that the longer‐term negative effect on category volume cancelled out approximately two thirds of the gains of the price promotion to the retailer.

Keywords

Citation

Dawes, J. (2004), "Assessing the impact of a very successful price promotion on brand, category and competitor sales", Journal of Product & Brand Management, Vol. 13 No. 5, pp. 303-314. https://doi.org/10.1108/10610420410554395

Publisher

:

Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited