Thursday, March 4, 2010

Cash Refunds

In the marketing textbook, Kotler says that "cash refunds," also known as rebates, are similar to coupons expcet that the price reduction occurs after the purchase rather than at the retail outlet. Stores often use this technique of selling and this is seen mostly as mail in rebates.

In my particular example, the price of the Blackberry is $299.99 with a 2 year contract. After a mail in rebate the price is only $199.99, but you must pay the $299.99 today, and receive the rebate later. However, ATT advertises the Blackberry with a price of $199.99. This seems like a way to attract the customers to the item by showing the low price.

http://www.wireless.att.com/cell-phone-service/cell-phone-details/?device=BlackBerry%C2%AE+Bold+(TM)+9700&q_sku=sku4130251



Kenichi Sato Section G

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