Discounts are a powerful tool in your Amazon playbook — but only if they’re used strategically.
Done right, they boost:
✅ Sales velocity
✅ Organic rank
✅ Conversion rate
✅ Buy Box share
Done wrong? They cut into profit, devalue your brand, and spark price wars you can’t win.
Here’s how to run discounts the smart way.
🧠 Why Discounts Work (When They’re Smart)
Amazon’s algorithm rewards velocity.
That means products that sell more — especially quickly — rank higher.
Discounts help you:
- Trigger algorithmic boosts
- Improve CTR and CVR (click-through and conversion rates)
- Gain early reviews faster
- Move stagnant inventory
But only if you balance sales lift with profitability.
🔍 Types of Amazon Discounts (And When to Use Them)
🔸 Coupons
- Visible in search results (green tag = higher CTR)
- $ or % off
- Cost is paid by the seller (you cover the discount + $0.60 per redemption fee)
Best for:
✅ Increasing visibility
✅ Low-commitment promos
✅ Products with decent margins
🔸 Percentage-Off Promotions
- More flexible targeting (e.g. first-time buyers, brand followers)
- Stackable with Subscribe & Save
- Not as visible as coupons
Best for:
✅ Loyalty building
✅ Cross-selling bundles
✅ Influencer promos with exclusive codes
🔸 Lightning Deals
- Limited-time deals on Amazon’s Deals page
- Requires eligibility and fee (often $150+)
- Price must be lowest in past 30 days
Best for:
✅ Seasonal spikes (Prime Day, Black Friday)
✅ Overstock or slow-moving items
✅ Products with strong review volume
🔸 Buy One, Get One (BOGO) / Tiered Promotions
- Buy 2, save 10% / Buy 3, save 15%, etc.
- Can increase average order value
Best for:
✅ Repeat-purchase items
✅ Accessories or low-ticket products
✅ Driving bulk buys
📈 Smart Discounting by Goal
| Goal | Best Discount Type | Notes |
|---|---|---|
| Boost launch velocity | % Off or Lightning Deal | Use promo + ad support |
| Increase rank for a keyword | Coupon + Sponsored Product Ads | CTR boost + conversion boost |
| Move slow inventory | Lightning Deal or % Off | Consider bundling or BOGO |
| Increase AOV | Tiered or bundled discounts | Target high repeat-purchase products |
| Drive reviews | % Off with post-purchase follow-up | Stay compliant, avoid Vine |
💡 Discounting Best Practices
✅ Set clear goals before discounting
✅ Track your pre- and post-promo conversion rate
✅ Combine discounts with ads for max impact
✅ Use attribution tags to measure external traffic response
✅ Avoid long-term discounts that train buyers to wait for sales
📉 Mistakes to Avoid
❌ Running the same discount every week
❌ Offering deep discounts without a profit model
❌ Ignoring discount cannibalization on your full-price SKUs
❌ Running deals without inventory planning (stockouts = lost momentum)
❌ Over-relying on discounts for rank
🧮 Profitability Check: Sample Scenario
Product Price: $29.99
Coupon: 20% off + $0.60 redemption fee
FBA Fees: $6.25
COGS: $7.50
Payout after discount = ~$16
Profit = ~$2.25
✅ Smart IF: You’re launching and boosting rank with ads
❌ Dumb IF: You’re already on page one with healthy organic traffic
🧪 Real Case Study
Brand: Kitchen accessories
Used 15% coupon + aggressive Sponsored Ads for 10 days
→ CTR up 34%
→ Conversion rate up 18%
→ Organic ranking moved from page 3 → page 1
→ TACoS held at 12%
→ Paused coupon after achieving sticky rank
🎯 Outcome: Smart discounting created long-term lift, not short-term loss.
💼 How Marketplace Valet Helps
We help Amazon sellers:
- Build discount strategies aligned with margin goals
- Time deals around ad campaigns and inventory flow
- Monitor coupon ROI and Lightning Deal eligibility
- Balance growth vs. profitability using data
Final Thoughts
Discounts aren’t bad — they’re just often misused.
Smart Amazon sellers treat discounting like a scalpel, not a sledgehammer.
✅ Use the right tool for the right job
✅ Watch your margins
✅ Track what works
✅ Don’t discount just to feel busy — discount to drive growth