What is a Discount?
For the latest version of Commerce Server 2007 Help, see the Microsoft Web site.
Discounts are a specific type of marketing promotion in which you invite shoppers to save money on specific products or product groups. Discounts are a significant part of your online merchandising strategy. You can use discounts to introduce new products, retain existing customers, or drive revenue growth. Because the process of creating a discount is complex, as a marketing manager, you will have to understand how discounts work in Commerce Server 2007.
Why Create a Discount?
You create discounts so that you can drive sales on products or groups of products to your customers who meet certain specified conditions. For example, you may have a product in your inventory that has not been selling as planned. You can create a discount for that product and promote it to customers who you think may need that product. For example, in December, you may have an over-abundance of shorts that you want to sell quickly. Therefore, you target a 50 percent discount on shorts to your California customers.
Commerce Server 2007 lets you apply a discount against a whole order (an order-level discount) or against specific items in the order (an item-level discount). You can apply multiple discounts to an item or an order, and control the sequence in which the discounts are applied. You can mix both item-level and order-level discounts in a single order.
The following defines order-level and item-level discounts:
Item-leveldiscounts apply to specific products in the basket. You can apply multiple discounts to a single line item or to a single order.
Order-leveldiscounts apply to all products in a shopping basket. For example, free shipping is a type of order-level discount. You can give users free shipping for all products in their basket. Order-level discounts that are delivered with Commerce Server are free shipping, and a percentage or amount off the total price. You cannot apply multiple discounts to an order-level discount. Order-level discounts have an implicit limit of 1.
Be careful when you create certain types of discounts. If you do not set the discounts up correctly, you could be giving your products away.
Discount Types
The following are the six types of discounts you can create by using the New Discount Wizard:
Simple Discount. Offer a price reduction on a product by a percentage or a monetary amount. For example, buy a shirt and receive 25 percent off the original price.
Minimum Purchase Discount. Offer a price reduction on a minimum quantity purchase. For example, buy two shirts and receive 20 percent off each shirt.
Buy N, Get one Free. Offer a free gift with a minimum quantity purchase. For example, buy two shirts and receive a third shirt for free.
Note
The shirt is not automatically added to the basket. The customer must add the third shirt to the basket in order to receive the 100 percent discount for the third shirt.
Paired Discount. Offer a price reduction on a product if another product is purchased. For example, buy a shirt and receive 10 dollars off a pair of jeans.
Paired Set Discount. Offer a price reduction on an item if a certain quantity of another item is purchased. For example, buy three shirts and receive 30 percent off a pair of jeans.
Order Discount. Offer a price reduction or free shipping on the order total, if a certain amount is purchased. For example, buy 100 dollars worth of merchandise, and receive 10 percent off the total order.
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Important Note:Commerce Server uses an internal algorithm to determine how your discounts will apply. The discounts are applied by priority and the discount system keeps track of the products that were used for every discount. Therefore, even if the order total meets the discount requirement, the order level discount may not apply.
The discount priorities (order in which the discounts apply) and the discount interaction policies of previous discounts (rules that determine whether an item can be used in multiple discounts or receive multiple awards) determine whether the discount is applied.
The following order discount example explains this in detail.
Example of an order discount that is not applied
Discount 1 (Buy A, get B at 50 percent off) |
Discount 2 (order discount) |
|---|---|
Buy a shirt, get a sweater at 50 percent off. |
Buy more than 100 dollars worth of merchandise; receive 10 percent off the total order. |
Discount Interaction Policy: "Condition items of this discount can be reused as condition items for other discounts" is set to false. Therefore, the shirt cannot satisfy more than one condition. |
Discount Interaction Policy: All discount interaction policies are set to true. |
Priority: 1 |
Priority: 2 |
The following is an example of the user basket before the discount is applied:
Product |
Quantity |
Total price |
|---|---|---|
Shirt |
1 |
70 dollars |
Sweater |
1 |
50 dollars |
Total |
|
120 dollars |
The following is an example of the user basket after the discount is applied:
Product |
Quantity |
Total Price |
Price after the discount |
|---|---|---|---|
Shirt |
1 |
70 dollars |
70 dollars |
Sweater |
1 |
50 dollars |
25 dollars (Discount 1 applied) |
Total |
|
120 dollars |
95 dollars |
Discount 2 did not apply for the following reasons:
Discount 2 has a lower priority (2) than Discount 1 (1); therefore, Discount 1 is applied first.
Discount 2 (order total discount) is not applied because the shirt was used as a condition in Discount 1 and cannot be reused as a condition in Discount 2. (The discount interaction policy for Discount 1 does not allow a condition to be reused as a condition).
See Also
Other Resources
Discount Types in Commerce Server
How to Add Existing Coupons to a Discount
How to Set the Discount Priority
How to Set Discount Interaction Policies
Managing Tasks Common to All Business Management Applications