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.
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:
- Running an automatic discount that instantly applies at checkout, and is therefore available to any visitor to your online shop, or
- 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.
The case for automatic discounts
Ecommerce brands regularly use automatic discounts to reduce friction during large shopping events like Black Friday or seasonal sales, as well as increase impulse buys.
As Growth Suite app founder Muhammed Tufekyapan says, “In high-traffic moments, every extra step between ‘I want this’ and ‘I bought this’ costs conversions.”
Katie Breaker, sales director at BirdieBall Golf, knows how discount choice can impact conversion rates. For one campaign, they changed the discount to an automatic 20% savings. “Our conversion rate grew by 15% in just one night.”
The case for discount codes
Discount codes are best when you need greater control over targeted promotions.
Luxury accessory brand Eric Javits, for example, finds discount codes effective for segmentation and exclusivity. They’re also helpful for attribution in tracking influencer or affiliate partnerships, SMS/email campaigns, or VIP rewards.
“Codes also allow us to test different offers across audiences without making the promotion public-facing to all visitors,” says Dario Markovic, Eric Javits CEO.
Distributing discounts to segments doesn’t have to be complicated. Download our Advanced Shopify Segmentation Playbook for 13 ready-to-use segments.
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.
“We choose the discount type based on the outcome we want to drive, whether that’s pushing specific products or increasing cart value,” says Preslav Nikov, founder and CEO of Shopify Plus agency Craftberry. “The structure always follows the business goal, not the other way around.”
Below are recommendations and advice for when to use each Shopify discount type:
- Amount off products
- Amount off order
- Buy X get Y
- 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
Expert tips for using the amount-off product discount:
- Use a dollar-value discount for purchases of $100 or more and a percentage-off discount for purchases under $100. Research studies show that shoppers perceive those pairings as the best incentives.
- Give product discounts on items that have high views but low add-to-cart rates. Tufekyapan (of Growth Suite) explains, “In our analytics, we call these ‘bottlenecks’ — products consuming traffic but not converting. A targeted discount can unlock that trapped value.”
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. At BirdieBall Golf, for example, order-wide discounts typically result in 20% higher average sales per transaction. The discount entices customers to buy additional accessories.
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)
Nicky Zhu has seen how amount-off discounts improve cart values when requiring a minimum purchase. The AI interaction product manager at Dymesty, who also consults on discount strategy, advised a Shopify brand to scrap a $10-off-any-purchase coupon. After replacing it with a $15-off discount for orders $75+, AOV increased from $67 to $94.
Studies show that placing the “bad news” before the good when promoting Shopify discounts improves click-through rates. Ex: 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.
It’s beneficial for smaller merchants, too. Patricia Curts, managing director of jewelry brand The Mexican Collection, taps the discount for introducing a newer product alongside a stable seller.
She offered a new copper cuff for half price with the purchase of a silver bangle. The discount didn’t just generate initial sales. About 60% of buyers returned within 90 days to buy a copper cuff at full price.
“That's the actual win for small sellers,” Curts says. “You're not giving away margin forever. You're using one product to build a customer's taste for something new.”
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
- Convert first-time customers
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.
For example, Verena Street Coffee intentionally offers free shipping for orders over $40.
“Free shipping solves a real pain point for coffee. It’s a commodity customers can already buy locally,” says Eric Gantz, co-founder. “The threshold keeps us competitive with in-store options while lifting order size instead of eroding margin.”
You should also limit the shipping options to protect against exorbitant costs. Our analysis of 117 million Shopify discounts found that among the free-shipping discounts, one in three don’t have shipping rate cutoffs. No restrictions means you could be paying for expensive options or international orders.
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.
create, manage, and track your email marketing—without leaving Shopify.
Seguno is the top-rated email solution built exclusively for Shopify. Grow your sales with high-performing newsletters, email automation campaigns, and integrations with Facebook, Instagram, banners, pop-ups and more. Build and send engaging emails in our easy-to-use editor and take email creation to the next level with our Canva integration. Automate your email marketing and drive more revenue with welcome campaigns, checkout abandonment, post-purchase automations, tag triggers and more.
get email marketing tips, resources, and industry insights to help your Shopify store grow.