What is an example of a 'loss leader' strategy in retail?

A 'loss leader' strategy in retail involves selling specific products at a price lower than their cost in order to attract customers to the store with the hope that they will purchase additional items at regular price. This practice is designed to increase foot traffic and generate more sales overall, despite the initial loss on the price of the loss leader product itself.

For instance, a grocery store may sell milk, a common necessity, at a price significantly below what they paid for it. By doing so, the store attracts customers who may then purchase other items that carry a higher profit margin. This approach can be particularly effective in competitive retail environments where drawing in customers can lead to increased overall sales.

The other options reflect various strategies that do not directly align with the idea of intentionally pricing a product below its cost to lure customers in. High-end products may reflect a strategy focused on exclusivity and brand positioning rather than attracting traffic through lower prices. Discounts on seasonal items can influence customer behavior, but they don't necessarily involve selling below cost in the same strategic manner as a loss leader. Providing free samples can encourage customers to try new products but does not involve the pricing strategy associated with loss leaders.