Tiered Discounts

What are tiered discounts ?

Tiered discounts are a pricing strategy where customers unlock higher discounts as they spend more or buy in larger quantities. Each tier offers a specific percentage off once the spending threshold is met—for example, 10% off at $50, 15% at $100, and 20% at $200.

This approach motivates shoppers to increase their cart size in order to reach the next discount level, making it a powerful tactic for driving sales and increasing average order value.

Why use tiered discounts in ecommerce?

Tiered discounts encourage bigger purchases, improve customer satisfaction, and support long-term revenue growth. They’re especially useful in ecommerce and subscription businesses where incentives can lead to higher conversion rates and stronger retention. By rewarding customers for spending more, tiered pricing also builds perceived value and can lead to more repeat purchases over time.

How to implement a tiered discount structure

• Set clear spending or quantity thresholds
• Assign increasing discounts to each tier
• Communicate progress visually (e.g., “Spend $20 more to save 15%”)
• Automatically apply the correct discount at checkout

Example of tiered discounts

A skincare brand offers this tiered discount structure on its store:

• Spend $50 → Get 5% off
• Spend $100 – Get 10% off
• Spend $200 – Get 20% off

Shoppers are motivated to add extra items to their cart to reach the next discount level.

Driftcharge Tip

Apply tiered discounts to subscription orders to increase customer lifetime value (LTV) while encouraging larger recurring purchases.

Ganesh Pawar

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Ganesh Pawar is the founder of Driftcharge, a subscription management app designed to help Shopify merchants streamline and scale their subscription businesses. With a deep focus on solving real-world pain points—like legacy account page support, flexible subscription options, and advanced analytics—Ganesh is passionate about building tools that drive growth and retention.