Nerd Alert: Do Discounts Damage Brands? The Truth About Price Promotions

Welcome to Nerd Alert, a series of special episodes bridging the gap between marketing academia and practitioners. We’re breaking down highly involved, complex research into plain language and takeaways any marketer can use.

In this episode, Elena and Rob explore whether price promotions deliver more than just temporary sales spikes. They examine how different product categories respond to discounts and reveal when promotions might help or harm brand loyalty.

Topics covered:   

• [01:00] "The Long-Term Effects on Category Incidents"
• [02:00] How soup and yogurt categories respond to promotions
• [03:00] The short-term impact of discounts on sales
• [05:00] Premium brands and the "discount doom loop"
• [07:00] When promotions actually build customer retention
• [08:30] Using offers effectively for new TV advertisers 

 





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Resources: 
Pauwels, K., Hanssens, D. M., & Siddarth, S. (2002). The long-term effects of price promotions on category incidence, brand choice, and purchase quantity. Journal of Marketing Research, 39(4), 421–439. https://doi.org/10.1509/jmkr.39.4.421.19114 
 

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