Why Sales

Abstract

Why do retail stores use seasonal (after-Christmas) and intermittent (“manager’s blowout”) sales over the course of the year? Answers to such questions are no doubt many, given the diversity of researchers and practitioners in economics and marketing who have worked on them. However, almost everyone is agreed that many sales (and other forms of promotions covered in following chapters) are founded on two economic lines of argument, “price discrimination” (charging different consumers different prices for different units) and “peak-load pricing” (a special category of price discrimination that involves charging higher prices during hours and days of heavy demand and lower prices at other times).