One of the most effective ways to increase the average order value on your online store is to learn how to do tiered discounts on Shopify. These segmented pricing levels allow shoppers to save money by buying set quantities or specified combinations of products. Find out more about tiered pricing models and discover how the Automatic Discounts & Gifts (ADG) app makes it easy to offer tiered discounts to customers.
How To Do Tiered Discounts on Shopify
The only built-in method on Shopify for offering tiered discounts is to create a discount code for each promotion tier. Open your Shopify admin and go to “Discounts.” Select “Codes” and then “Create Discounts.” You must create a unique code for each tier and specify names, values, and rules. Installing the ADG app on your online store makes presenting multiple discount levels to customers easier.
After installing the ADG app, click “Apps” in your Shopify admin and search for “ADG.” You can then take the following steps on the app dashboard to create any number of discount tiers:
- Click “New Deal.”
- Select “Tiered discounts.”
- Specify a discount code, conditions, and usage limits.
- Use the “Duplicate benefit” button to add multiple tiers.
- Click “Create deal.”
Creating tiered discounts on Shopify with ADG can be as simple as setting conditions for each tier regarding dollar values or percentages. Usage limits and other rules can ensure that customers claim discounts as intended.
The offer will go live in your store as soon as you create a deal. All you need to do is advertise the availability of tiered discounts by displaying an announcement bar or pop-up on your storefront. It is important to plan ahead to ensure that your store maintains acceptable profit margins while running any type of promotion.
The Benefits of Offering Tiered Discounts
There are several benefits to offering tiered discounts on Shopify. This type of promotion can work as an upselling strategy by rewarding customers who purchase larger quantities of particular products. Some shoppers will be willing to buy more items to lock in lower prices.
Offering discounts based on order quantity can also expand the customer base of your online store. Wholesalers and large traders tend to order in bulk when sellers offer tiered discounts or volume pricing. Depending on how you do tiered discounts on Shopify, these promotions can drive sales of particular products. With the right approach, you can also use discount tiers to cross-sell products or upsell related items.
Tiered discounts have the potential to improve the customer experience. Most shoppers appreciate opportunities to save money that are easy to understand, which can be the case with tiered or volume discounts. Getting a better sense of the difference between these pricing methods can help you clearly communicate the terms and conditions for either type of discount to customers.
How Tiered Discounts Compare To Volume Pricing
Shopify tiered discounts involve pairing multiple levels of item quantities with price reductions. To run this type of promotion, you must determine the quantities of items and rates for each tier. A common approach involves taking a percentage off of the price for set quantities of items:
- Buy three to five items at 10% off
- Buy six to eight items at 15% off
- Buy nine to 12 items at 20% off
Large orders may span more than one tier. For example, say a customer places an order for seven items under this percentage-based promotion. The third, fourth, and fifth items would qualify for a 10% discount, while the sixth and seventh items would be 15% off.
It is also possible to create tiers with fixed-value discounts. This type of promotion might take $10 off a purchase of three items, $40 off a purchase of five items, and $100 off a purchase of 10 items. You can also do tiered discounts on Shopify based on order totals, such as $25 off a purchase of $100 or more or $50 off a purchase of $200 or more.
Volume or bulk pricing is strictly based on the total number of items in orders. In a volume pricing model with a price per unit of $15 for up to four items and $10 for five to 10 items, an order for eight items would lock in a price per unit of $10 for a total of $80. Under tiered pricing, the first four items would cost $15 each, and the items in the second tier would cost $10 per item for $100. Consider which type of discount is most likely to appeal to the customers of your online store.
When To Offer Tiered Discounts on Shopify
Tiered discounts can be useful when you need to turn over your inventory of a particular product. If you plan to phase out an old version of a product in favor of a new version, reducing prices on large orders could help to clear out backstock. Make sure that you have sufficient inventory before promoting tiered or volume discounts.
Shopify tiered discounts can also boost conversion rates. This type of promotion encourages returning customers to purchase more items and can attract new leads with a competitive deal. Many shoppers appreciate having the ability to determine how much they save based on the quantity of items they buy.
Tiered discounts have the potential to be an effective growth strategy. This type of discount is likely to increase the quantity of items sold during a promotion. A price reduction that scales based on the quantity of products purchased could broaden your customer base while raising the average order value of your Shopify store.
The Easiest Way To Rock Tiered Discounts on Shopify
A short answer to the frequently asked question of how to do tiered discounts on Shopify is to use the ADG app to create and manage these promotions. We make it easy to create pricing tiers and automatically enforce minimum cart value requirements or usage limits.
Choose a package and install ADG to start offering Shopify tiered discounts to customers today.
with 200+ 
reviews 