Promotional pricing strategies: how to choose the right Shopify discount type

Shopify merchants don’t need to shadow the retailer playbook of running sale after sale. But that doesn’t mean promotional pricing doesn’t have a place. 

Discounts can drive demand, boost short-term sales, and reward and encourage loyalty. With careful consideration, Shopify discounts are often integral to achieving profitability goals. 

 We’re breaking down Shopify discount types, when to use them, and best practices for protecting the bottom line.

This article is part of Seguno’s Shopify Discount Strategy Series, which covers discount types, safeguards, unique codes, and promotion strategy.

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How to decide between automatic discounts vs discount codes

Before we wade into all of the Shopify discount types, the first decision is choosing between:

1. Running an automatic discount that instantly applies at checkout, and is therefore available to any visitor to your online shop, or 
2. Offering a Shopify discount code that a customer must enter at checkout; it could be available to any website visitor or shared through a different marketing channel

The chart below is a basic guide for determining the option most appropriate for your goal.

When and how to use the 4 Shopify discount types

Pulling off a successful promotional pricing strategy starts with identifying your business goal and aligning it with the right discount. Below are recommendations and advice for when to use each Shopify discount type:

1. Amount off products
2. Amount off order
3. Buy X get Y
4. Free shipping 

When to use the amount-off products discount 

The “amount off products” option lets your shoppers apply a discount (percentage or fixed dollar value) to specific items or collections you designate. 

It’s the most popular of the bunch. According to research, 79.7% of shoppers surveyed said that a percentage or amount off an item makes them most likely to purchase. 

Use the amount-off product discount to:

• Promote or clear inventory of specific SKUs or collections
• Control your margins 
• Test demand for new or seasonal products

Studies show that shoppers perceive a dollar-value discount as a better incentive for higher-priced purchases of $100 or more than a percentage off. The reverse is true for products under $100. 

When to use the amount-off order discount 

The “amount off order” option applies either a percentage or a fixed discount to everything a customer places in the cart. Therefore, it’s ideal for influencing total cart value.

Use the amount-off order discount to: 

• Run sitewide sales for key shopping periods, like Black Friday and Cyber Monday
• Boost lifecycle-based promotions, such as welcome emails or thank you messages
• Increase average order value (AOV)

An order discount without guardrails can quickly damage profit margins. Maintain control over a sitewide sale with a fixed-amount discount paired with a minimum purchase requirement. 

If you’re willing to loosen your grip for a potentially bigger payoff, implement a percentage-off discount with a minimum spend.   

Bonus tip: Studies show that placing the “bad news” before the good when promoting your Shopify discounts improves click-through rates. So, announce the condition first, followed by the reward; i.e., “spend $100 and get $10 off.” 

When to use the Buy X get Y discount

The “Buy X get Y” option rewards customers with a discount on an additional product (or products) after spending a specific amount, buying a minimum quantity, or purchasing a particular product/collection.  

Of the various combinations, here’s what it can look like: 

• Buy 1, get 1 free (BOGO) — or B2G1 free, etc. 
• Buy 1, get ½ off another product
• Spend $75, get __ for free
• Spend $50 from ___ collection, get 30% off ___ 

Use Buy X get Y discounts to:

• Increase products per order
• Clear excess or slow-moving inventory
• Introduce complementary products
• Increase perceived value without a sitewide discount

While Buy X get Y is less popular than other Shopify discounts, research from our 2025 Unique Discount Benchmarking Report indicates that larger brands see their value. Shopify stores with a GMV of at least $20 million use Buy X get Y (with unique, one-time-use codes) more frequently than smaller brands. 

Free shipping 

The “free shipping” option allows you to waive shipping fees. 

It’s an ideal tactic for removing checkout friction. According to Baymard Institute research, 48% of consumers abandon their carts during online checkout because extra costs, including shipping, are too high.

Use free-shipping discounts to:

• Reduce cart abandonment
• Encourage higher AOV by requiring a threshold
• Preserve product pricing and brand perception

Set a minimum purchase requirement to avoid hemorrhaging money. Research indicates 58% of shoppers will add items to their cart to qualify. Do the math to ensure it’s not an arbitrary threshold that infringes on profits.

Pick your promotional pricing strategy and build in protections

With thoughtful planning, discount pricing can attract and retain customers and help you fulfill your brand’s sales ambitions. 

It requires matching the right Shopify discount to the goal, along with adding discount safeguards such as:

• Setting minimum spending thresholds
• Reserving the discount for higher-priced products or collections 
• Limiting an offer to high-value segments
• Preventing leakage with unique coupon codes 

Shopify discounts aren’t just a tool for quick revenue wins. They can be a reliable resource for attaining a healthy bottom line over the long haul.