Question

Which of the following is NOT an example of a nonprice demand strategy that a retailer could employ as a means of increasing its demand?

1) Increasing the width of the store's aisles, so the customer can freely move around in the store.
2) Providing 'out-of-town' customers with free gasoline.
3) Offering a 30-day guarantee to customers if they find the same product for a cheaper price.
4) Providing customers using public transportation with complimentary 'ride and shop' coupons.
5) Developing an advertising campaign aimed at persuading consumers to make more of their purchases at its stores.

Answer 1

Offering a 30-day guarantee for a lower price is a pricing strategy, not a nonprice demand strategy, since it involves adjusting prices in response to competitors. Nonprice strategies could be advertising campaigns or quality assurances like money-back guarantees and excellent service to build brand loyalty.

Step-by-step explanation:

A strategy that is NOT an example of a nonprice demand strategy that a retailer could employ to increase demand is offering a 30-day guarantee for a lower price. This is actually a pricing strategy, as it involves potentially lowering the price if the customer finds a similar item at a cheaper cost elsewhere, thus playing directly on the price aspect rather than the non-price factors. Nonprice strategies typically include methods such as improving product quality, offering money-back guarantees, superior customer service, or product differentiation through unique features. An example of a nonprice demand strategy is developing an advertising campaign to persuade consumers to frequent a particular store more often. This aims to build brand loyalty and customer preference without altering price.

Other nonprice strategies include implied quality through guarantees, warranties, and service contracts, which serve as reassurance of the product's value and encourage purchases even when customers cannot physically inspect the goods, such as in online sales. Customer-centric policies like allowing dish exchanges in restaurants or ticket refunds at movie theaters when dissatisfaction occurs also enhance the perceived value and can spur demand.