Compare and contrast coupons with rebates

Question

What will be an ideal response?

Answer 1

Answer: Coupons and rebates are both consumer promotional tools. The biggest category of consumer promotion is coupons, printed or electronic certificates that spur sales by giving buyers a discount when they purchase specified products. Paper couponing is an inefficient technique, however; consumers redeem only 1 percent of the 300 billion printed coupons distributed every year in the United States. The rapid growth of mobile couponing via smartphones and new social systems are revolutionizing couponing. While they are creating opportunities for businesses, the spread of these coupons is changing buyer behavior as more and more consumers now expect stores and restaurants to offer coupons.
With rebates, companies offer partial reimbursement of the price as a purchase incentive. Rebates can be an effective tool for boosting sales, but they obviously cut into per-unit profits–and the effect can be more or less permanent when frequent rebates in an industry encourage buyers to delay purchases until a rebate program is available.