Talk:Buy one, get one free

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[edit] Things to add, perhaps?

If someone is so minded, may I suggest adding a paragraph that explains what the seller gets out of the deal? Presumably BOGOF works only if the profit margin is high enough to cover the cost of making and selling both items... and wouldn't work on a low profit margin? So it's an indication of a high profit margin to start with?? I'm just speculating. Or is the idea to get people into a buying pattern -- to buy an item at least once that they will then buy many times in future. So the profit comes from the repeat purchase and the BOGOF is a loss-leader? Perhaps both strategies are used. Maybe someone who understands can explain this further. It's one of the things missing from the article as it stands now. Thanks! Marcusswann 12:19, 31 October 2006 (UTC)

The article seems to me to be completely explicit in some length on this point. I had the same question in my mind, and found my question completely answered. The point is to get the consumer to buy two items when they might have bought none. The sleight of hand - if one can call it that - is that it appears that the seller is accepting a lower margin than they might without the BOGOF. But this assumes that the customer was going to buy the product in any case. Yes, the seller gets less for the units that would have been bought anyway, but this is more than compensated for byu increased volume. The other benefits may well play a part - as in any promotion.

Thanks for the clarification, but I really don't think it's that simple. Yes, obviously some customers buy two items instead of none... but that only makes financial sense in some cases. Which cases? How would I, as a shopkeeper, know which items to offer on BOGOF? There must be products for which BOGOF promotions make sense and ones for which they don't. Otherwise, everything would be sold on a BOGOF basis, always, right? So why aren't things like cars sold on BOGOF? I think there's more to it than you suggest and I'd be grateful if anyone who knows the secrets would reveal them! Marcusswann 21:10, 18 November 2006 (UTC)

This is my basic understanding on the econmoics of BOGOF, im not even sure that this is right. BOGOF would only apply to necessary goods i.e. food products. These products do not make huge amounts of profits but they are usually price elastic, so when sold as BOGOF they make less profit but sales are increased to cover and excell that lost profit. BOGOF could not apply to cars because they are a luxury good and have a low price elasticity. They are expensive to manufactor etc so BOGOF would lose revenue. It also might be an idea to add something about the surplus the customers enjoy when buying these products.