Hi-Lo pricing
Hi-Lo pricing is a pricing strategy used by retailers to attract customers by offering discounts on certain products while keeping other prices high. This strategy involves periodically discounting certain items to drive traffic to the store, where customers are likely to purchase other products at full price.
For example, a grocery store may offer a „buy one, get one free“ promotion on a popular brand of cereal to entice customers to visit the store. Once in the store, customers are likely to purchase other items at regular prices, thus increasing the overall revenue for the store.
While Hi-Lo pricing can be effective in driving sales and increasing customer traffic, it can also be risky for retailers. If customers become accustomed to waiting for discounts before making a purchase, they may be less likely to buy products at full price.
Overall, Hi-Lo pricing is a common strategy used by retailers to attract customers and increase sales. By offering discounts on select items, retailers can drive traffic to their stores and increase revenue.
References: Wikipedia – Pricing strategies