Ecommerce Discount Benchmarks (2026): Depth, Margin Cost and Repeat Rates

Short answer: In the 2025 holiday season, US online discounts peaked at 30.9% off list price for electronics, 25.1% for apparel and 18.8% for furniture, according to Adobe's holiday data. Everyday codes run shallower: in Seguno's dataset of 182 million single-use Shopify codes, 20% off was the most popular percentage level. A study of customer-level data from a newspaper and an online grocer found that a 35% acquisition discount brought in customers worth about one-half the long-term value of those who paid full price.

Those three numbers answer different questions: what shoppers see at peak, what Shopify brands set as a code, and what a discount does to the customer it acquires. This report keeps them apart, then works through the part most benchmark pages skip: how much extra volume each discount depth has to buy before it pays for itself at your margin.

Key figures at a glance

Peak discount depth by category

Adobe measures the deepest average discount off listed price that each category reaches during the November and December season, across transactions on US retail sites. Electronics and toys run deepest; furniture, appliances and sporting goods sit about ten points lower.

How peak depth has moved since 2023

Put Adobe's three season recaps and its 2026 forecast side by side and the pattern is stability, not escalation. Peak depth in most categories has moved by one or two points a year, and the 2026 forecast puts most categories at or slightly below their 2025 level.

Source: Adobe 2024 season recap (2023 and 2024 columns), Adobe 2025 season recap (2025) and Adobe's September 2026 forecast (2026). Adobe's 2023 figures are rounded to whole points.

One caution when reading Adobe's forecast: the comparison figures it labels as 2025 (30.1% for electronics, 28% for toys) match its 2024 recap, not the 2025 one. The table uses each season's own recap.

The 2026 forecast also gives the shape of the season. Adobe expects discounts of up to 14% in early November, up to 21% just before Thanksgiving, up to 30% during Cyber Week and up to 10-15% through December, with October's Prime Day event peaking at 19%. Black Friday is expected to carry the deepest deals for TVs, toys, apparel, appliances and furniture, and Cyber Monday the deepest for electronics and computers.

Season averages run lower than peaks

A peak is the deepest point. The average across the whole season is the better yardstick for your own blended discount rate. Salesforce's 2024 holiday data put the average US discount for the full season at 23% (up 1% year on year) and the global average at 22%.

Apparel and beauty sit well above the average in Salesforce's data, while Adobe's apparel peak is lower. The two measure different things: Salesforce averages the discount rate across a whole season for the retailers in its own index, while Adobe reports the single peak for a broad product category. For a 2025 Cyber Week view, Salesforce projected US discounts of 37% in general apparel, 35% in health and beauty and 23% in home.

What DTC brands actually offered over BFCM

Brand-level offers have been getting shallower. In Klaviyo's BFCM 2025 review, the overall discount fell from 29.6% to 26.2%, a decline of nearly 10%, based on its analysis of discounts in email subject lines. Small Business Saturday was the deepest day at roughly 28%, against about 26% on Black Friday and 24% on Thanksgiving. Low-AOV brands saw their best open rates at 20 to 29% off, and mid- and high-AOV brands at 30 to 39%.

Spending did not fall with the discounts. Klaviyo's recap of a stable cohort of 10,000 brands reported spending up 11% while discounts fell 10%, revenue from repeat customers up 13.5%, and the highest growth (+14%) among the brands offering the smallest discounts. Klaviyo's figures are unaudited, and the lightest discounters may also have had the strongest brands, so read this as a correlation rather than proof that a shallower discount caused the growth.

For how those BFCM buyers behave afterwards, see the Black Friday customer retention benchmarks.

Everyday code depth on Shopify

Outside the holiday peak, the most useful dataset is the code itself. Seguno, a Shopify discount app, analysed 6,099 sets of single-use codes from 1,348 brands, 74% of them on Shopify Plus, all created between January 1 and December 31, 2025. Its redemption rate is codes used divided by codes generated, so it measures how often an issued code gets used, not the share of a store's orders that carry a code.

Three findings matter for setting depth:

• 20% off was both the most popular level (933 code sets) and the best redeemed, at 0.89%. Going to 25% added nothing: Seguno's table shows a 0.88% redemption rate and a $106.11 AOV at 25%, against $108.10 at 20%.
• 10% off had the highest AOV ($122.68) and by far the lowest redemption rate (0.20%). Seguno reads this as a sign that shallow codes mostly go to customers who would have bought anyway.
• Minimum spends change the economics of fixed-amount codes. Amount-off codes with a minimum spend had a $100.79 AOV against $39.30 without one, at a redemption rate of 0.76% against 1.00%.

The strongest codes in the data were not seasonal blasts. Codes for insiders such as employees, friends and students were redeemed at 4.01% with a $143.67 AOV, against 0.79% and $92.71 for seasonal promotions, yet 95.8% of code sets were open to anyone.

Which discount benchmark to use for which decision

Source: Adobe, Salesforce, Klaviyo, Seguno and Finaloop, each as described in the sections above and below.

None of these measures the share of a typical Shopify store's orders that use a discount code. No trusted platform publishes that figure with a disclosed sample, so the closest proxy is your own discount rate, covered in the measurement section below.

The margin cost: how much volume a discount has to buy

A discount comes straight out of gross profit. The extra orders have to replace that lost margin before the promotion makes money. The break-even volume lift for a price cut is:

Required volume lift = discount ÷ (gross margin − discount)

Use the margin left after product cost, shipping and payment fees, because those costs do not shrink when the price does. Finaloop's benchmark study, which nets landed cost, merchant fees and shipping out of gross margin, puts the median at 56% for eight-figure brands and 52% for seven-figure brands, with industries ranging from 43% (sporting goods) to 66% (leisure and lifestyle).

The worked example below uses 55%, the median gross margin for about 500 eight-figure brands in Finaloop data discussed by Common Thread Collective.

Worked example: 20% off at a 55% margin

For example, take an $80 order at a 55% margin, where each full-price order would earn $44 of gross profit. At 20% off the customer would pay $64, the cost of the order would stay at $36, and gross profit would fall to $28.

To earn the same $44,000 that 1,000 full-price orders would have made, you would need 1,572 discounted orders: 57% more volume. If the promotion lifts orders by 40%, to 1,400, your gross profit would be $39,200, so the promotion would cost $4,800 against not running it at all, before counting any orders pulled forward from the following weeks.

Break-even volume lift by discount depth and margin

Source: Mage calculation using required lift = discount ÷ (margin − discount). The margin columns span the industry medians in Finaloop's study.

Read across a row and the problem is plain. In our worked table, a 30% Cyber Week discount at a 40% margin would need four times the normal volume to break even, while the same discount at a 70% margin would need 75% more. The categories that discount deepest therefore need the highest margins to make a promotion pay, and a store that matches the market's peak depth without checking its own margin can lose money on every extra order.

What volume response is realistic

Two published measures bracket the answer. A meta-analysis of 1,851 price elasticities from 81 studies found an average of −2.62: a 1% price cut lifts sales by about 2.62%. Adobe's 2024 holiday recap measured a far weaker market-wide response: for every 1% decrease in price, demand increased by 1.029%, which Adobe credits with $2.25 billion of extra online spend.

Applied to the table, our calculation gives this. At the meta-analysis average, a 10% cut would lift volume by about 26%, enough to clear the 22% break-even at a 55% margin. A 20% cut would lift volume by about 52%, short of the 57% needed, and a 30% cut by about 79%, far short of 120%. At Adobe's market-wide response of roughly one for one, no discount in the table would break even at any margin shown.

That gives a simple ceiling, again our calculation. With linear demand, a discount would pay only while it is smaller than your margin minus one divided by your elasticity. At an elasticity of 2.62 the ceiling would be about 17% at a 55% margin, 22% at 60% and 32% at 70%, and close to zero at 40%. A single brand's codes can beat the market average, because some of its lift comes from competitors, but that lift is not all new demand either.

Most measured lift is not incremental

Gross lift overstates what a promotion earns. When researchers measured every promotion CVS ran in 2003, about 45% of the gross lift was incremental, more than 50% of promotions were unprofitable, and the net profit impact of all promotions was −$25.3 million on about $9 billion of front-store sales. Cutting promotions in the 15 worst categories reduced sales by about $7.8 million and improved profit by about $52.6 million.

If your own promotion showed the same pattern, a 57% observed lift would be closer to 26% of real new demand (our calculation), and a 20% code at a 55% margin would lose money even when the dashboard says it broke even. Measure lift against a holdout group or the same weeks of the prior year, not against the week before the sale.

Our profit margin benchmarks set out the full margin stack, and the analysis of discounts versus points runs the same arithmetic for loyalty rewards.

How to measure your discount rate in Shopify

The number to track is discounts as a share of gross sales, over a full year and by month. Shopify's sales reports show gross sales, discounts, returns and net sales side by side, so your discount rate is discounts divided by gross sales. Track it by channel and by code where you can, because one sitewide sale can hide inside a healthy-looking annual average.

Finaloop's net sales measure subtracts discounts, refunds and returns from total sales and divides by total sales. Its 2024 medians run from 80% in consumer electronics to 93% in home, garden and office. In health and beauty the quartiles run 99%, 94%, 90% (median), 86% and 67%, and Finaloop's action plan says to keep net sales above 88% of gross sales.

Source: tiers set by Mage from the industry medians and the 88% guideline in Finaloop's study. Returns sit inside this measure, so separate them before you blame discounts.

What happens to customers you acquire with a discount

The margin math above covers one order. The larger cost is often the customer a deep discount brings in.

• Lower lifetime value. Using customer-level data from a newspaper and an online grocer, Lewis (Journal of Marketing Research) found that acquisition discount depth was negatively related to repeat-buying rates and customer asset value; a 35% acquisition discount produced customers worth about one-half of those acquired without a promotion.
• Free trials show the same pattern. In household panel data from a digital TV service, customers acquired on free trials had an average customer lifetime value 59% lower than regular customers, although they responded more to marketing communication.
• First-time and established customers react in opposite ways. In three large field experiments at a catalog retailer, deeper discounts increased future purchases by first-time customers but reduced them for established customers, through forward buying and greater deal sensitivity.
• Discounting trains price expectations. A controlled experiment found that promotion frequency and depth both lower the price consumers expect to pay, and a missing deal when one is expected hurts brand choice.
• Sensitivity builds over years. Over more than eight years of panel data for a packaged good, consumers became more price and promotion sensitive as promotions rose and advertising fell.
• The offer often matters more than the price cut. In 70 randomised experiments at an online ticket marketplace, emailed discount offers raised spending by $3.03 (37.2%) during the promotion window, but 90% of the gain did not come through redemption of the offer, and spending stayed $1.55 higher in the week after it expired.

Most of this research comes from newspapers, grocers, catalogs and packaged goods, and much of it is more than ten years old. No trusted source has published a recent cohort comparison of discount-acquired and full-price customers for Shopify or DTC brands. The direction is consistent, though: deep acquisition discounts select for deal-seekers and lower the value of the cohort.

Worked example: the acquisition discount's hidden cost

Suppose your full-price customers earn you $150 of gross profit over three years. If a 35% welcome discount produced customers worth half that, as in the newspaper and grocer data above, each discount-acquired customer would be worth $75. A welcome code that lifted first-order conversion by 50% would then bring in 1.5 customers worth $75 each, $112.50 in total, for every full-price customer it would otherwise have won at $150. The code would lose on lifetime value before you count the discount itself. A shallow welcome offer, or one that pays out on the second order, would avoid most of that selection effect.

Our retention rate benchmarks give the repeat-rate baselines to compare discount-acquired cohorts against.

Store credit and gift cards: what the evidence does and does not show

Store credit is often proposed as the alternative to a discount. The evidence for it is thinner than the evidence against deep discounts, and it should be read that way.

What research does show is that money tied to one retailer is spent differently from cash. Across six studies, shoppers with a retailer-specific gift card preferred products typical of that retailer compared with shoppers using more fungible money. In three studies including transactions at a campus bookstore, people spent gift card money disproportionately on hedonic goods rather than utilitarian ones.

Some stored value also goes unused. Starbucks recognised breakage revenue of $200.4 million in company-operated stores and $22.0 million in licensed stores for fiscal 2025, the portion of stored value cards it does not expect to be redeemed, according to its 10-K filing. That is one large retailer with a mature card programme, not a rate a Shopify store should plan around, and unclaimed property rules vary by state.

Where store credit differs is in when and whether it costs you, as a matter of arithmetic rather than a measured result. A 20% discount is paid on today's order whether or not the customer would have bought anyway. A credit of the same value, earned on this order and spent on the next, would cost nothing unless the customer comes back, and some balances are never redeemed. No trusted study has yet measured store credit against an equivalent discount on margin or repeat rate in ecommerce, so test it against a holdout before you rely on it.

The Store Credit Playbook sets out how to structure credit as a discount replacement and what to measure.

A discount policy that holds up

• Set a depth ceiling from your margin. Use the break-even table and the ceiling rule above. If your margin is 55%, sitewide discounts above about 17% would need an unusually strong response to pay off.
• Make 20% your default code depth, not 30%. In Seguno's data, 20% off was redeemed as well as 25% off at a similar AOV.
• Add minimum spends to fixed-amount offers to protect order value, and cap or exclude products on percentage offers.
• Target, don't blanket. Insider and segmented codes outperformed seasonal blasts in Seguno's data, and the email field experiments show much of an offer's lift arrives without the discount being redeemed.
• Keep acquisition offers shallow and move value to the second order, where it rewards a repeat purchase instead of selecting for deal-seekers.
• Report net sales as a share of gross sales every month, and investigate any month that drops below your category's median.

Using Mage instead of sitewide codes

Mage is a Shopify loyalty app, and its tools move discount spend from the first order to the next one. Store credit and cashback earned on a purchase give the customer a reason to return, and cost you only when they do. VIP tiers let you give existing customers early access and member-only offers instead of a deeper public discount. Our guide to loyalty discounts covers how to structure member offers so they do not turn into a standing sitewide code. To check it is working, compare members with non-members on discount rate, net sales share and 12-month repeat rate.

The The Store Credit Playbook covers replacing discounts with store credit to protect margin and drive repeat orders.