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Profit checks to make before running a discount event
Do not stop at the discount rate. Compare the post-discount profit and minimum margin line first.
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The remaining profit matters more than the discount rate
A discount percentage looks simple, but fees and ad costs usually remain in place and shrink real profit quickly.
Comparing profit before and after the event often shows that the room for discount is smaller than expected.
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Set a minimum margin line first
A minimum acceptable margin helps you decide much faster how far a promotion can go.
If coupons, points, or gifts are included, they should be summed together before judging the event.
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Check repeat purchase impact too
A low-margin first order can still make sense when repeat purchase is high.
One-time purchase products need a more conservative reading because the event profit stands on its own.