Data allows retailers to offer a targeted and more personalized discount strategy. At Hearts and Minds, a Sydney based CX web design agency, we help our clients use e-commerce discounts to increase their sales turnover without cannibalizing their margin.

While e-commerce discounts can certainly bring forward demand, they may or may not increase sales. Business owners are increasingly looking for ways to exercise more control over discounting without unnecessarily giving away margin.

There are 4 keyways online retailers use e-commerce discounts to improve sales outcomes; customer acquisitions, loyalty, loss leader discounts and inventory management.

Customer acquisitions

E-commerce discounts can be used as a carrot to drive customer acquisition, achieving different acquisition related goals such as driving customers to your store, signing them up to an email database or converting prospects into customers.

The savings on the cost of customer acquisition will often be enough to fund the discount. Like any campaign, discount driven customer acquisition campaigns work better after experimentation with different offers.


Loyal customers expect privileged treatment. Discounts, like early bird access to sales, can increase loyalty. Discounts can also be used to reward increased expenditure or lock in loyal customers to fend off competitors.

Discounting to loyal customers requires careful analysis through testing to preserve margin and positive brand perceptions. By benchmarking use of discounts against a control test group, it is possible to calculate the return on investment of these loyalty endeavors.

Loss leader’s discounts

Loss leaders are heavily discounted products and services which bring traffic into the store. Businesses often choose loss leaders to drive frequent visits, upselling and cross selling customers once they enter the site. Testing the most effective loss leaders across segments and seasons allows the business to continuously improve on its loss leader traffic. Data analysis will determine both traffic quality and quantity, so loss leaders can be continually optimised.

Inventory management

It has often been said retail is a game of knowing when to “get in and when to get out’ of a product sale. Keeping stock moving and responding to sales trends is key to maximizing profit. Discounting allows a business to move slower selling products to concentrate on better selling items. Using data to gain visibility into inventory management, can be key to turning over inventory faster through discounting. Targeted discounting can allow a business to do this to select groups, without a negative hit to the brand through blanket discounts.

Discounts, powered by the right technology and data insights, can make a significant increase in sales performance. Ask one of Hearts and Minds e-commerce discount experts, how you can lift your sales performance through data driven discounts.


Louise Kelly
Hearts and Minds