Module 03 · Lesson 04
CPG Economics · Promotion

The same promo.
Three very different outcomes.

One brand. One ad + display + 20% off promotion. Three ways to fund it — Bulk Cost, Full Cost, and Maintain Margin. In the next 8 minutes you'll read the deal sheet, drag the discount yourself, and stamp the right play.

📊 Read a deal sheet 🎚️ Tune the discount 🎯 Pick the right play
Driving Question
When the retailer's profit goes up, who pays for it — and how do you keep the supplier in the black?
Definitions
Three plays how brands fund a 20% off promotion

Bulk Cost. Full Cost. Maintain Margin.

Three ways to write the same promo into the deal sheet — each shifting profit between supplier, retailer, and shopper.

Safe
PLAY 01
Bulk Cost

Supplier funds only the baseline volume. Retailer keeps shelf price up; the discount is a lump on baseline units. No incremental units, no incremental cost.

Volume lift
0 units
Supplier profit
$297.50
Growth
PLAY 02
Full Cost

Supplier funds every unit sold at the promotional allowance. Volume jumps to 750. Supplier profit nudges up because the math just barely works.

Volume lift
+500
Supplier profit
$337.50
Loss
PLAY 03
Maintain Margin

Supplier funds at an amplified rate so the retailer keeps their margin %. Volume doubles, but the over-funding sinks the supplier into the red.

Volume lift
+500
Supplier profit
-$95.00
Click to reveal
Interaction tap each strategy header to reveal its column

Read the deal sheet.

BASE WEEK
Lab
Drag the knobs how depth + amplification reshape the deal

Tune the discount.

Depth of discount
20%
10%15%20%25%30%
Amplification factor
3.0×
1×2×3×4×
DEFINITIONS
Depth — how much the shelf price drops vs. baseline.
Amplification — how much the discount lifts unit volume vs. base week (250 units).
LIVE DEAL SHEET
Full Cost · 20% · 3.0×
Total units750
Shelf price$5.59
Promo allowance / unit$0.40
Total promo spend$800
Net selling $$2,505
Cost of goods$1,687
Supplier profit$674
PROFIT-SAFE
At 20% / 3×, the supplier nets profit. Push depth past 25% and watch the headline tip red.
Check Yourself
Quiz · 3 questions pick the best answer; instant feedback
Recap
Takeaways what to remember when you read the next deal sheet

Three plays, one trade-off.

01
Bulk Cost protects profit, not growth.
Use when you want trial without volume risk. Supplier profit stays at base — $297.50.
02
Full Cost grows volume, barely grows profit.
Best when you need shelf velocity. Profit nudges up +$40; promo spend rises +$150.
03
Maintain Margin over-funds the retailer.
The supplier pays the retailer's margin growth in cash — -$95.00 per promo week.
04
Always tune two knobs.
Depth of discount and amplification are the two levers that decide profit shape.
Supplier profit Δ vs. base week
Bulk Cost
$0
Full Cost
+$40
Maintain
-$393
Read the headline: the question is never "does the promo grow units?" — every promo grows units. The question is "who pockets the profit, and at what amplification does the supplier tip into loss?"