Is Discounting Usage Intensifying in eCommerce?
)
If you are a regular reader of this column, you’ll know that 2024 has been a bit of a shocker in terms of revenue growth thus far. Particularly weak performances across January and April have conspired to leave the year-to-date growth figure, with five months of data in, running at -4.3%. This is against a forecast of 0%, so you can see just how far behind those months have dragged us. There are numerous possible reasons behind this sluggish performance – the failure of summer to get started, economic malaise etc – though it is worth saying that the growth trajectory is pointing in the right direction, it’s just very slow pedalling (uphill) to arrive at that destination.
The Role of Discounting in Retail
If trading conditions are proving tough though, are we seeing retailers reach for certain levers that you might expect to help stimulate some demand – chief among which would be discounting?
The answer is yes, but it’s a complicated yes. To be clear, there is nothing uncommon or necessarily wrong with discounting, and there are many different ways in which it can be deployed. The retail calendar organically lends itself to having periods of clearance as seasons change – any stock that has not sold needs to be run through to make space in the warehouse for the new products. Retailers also run flash sales, which might be an attempt to build a bit of demand and catch up on revenue targets if things have proven slower than they had anticipated (or, indeed, to steal a march on the competition).
Challenges of Entrenched Discounting
The slightly more problematic occurrence of discounting is where it isn’t being used for cyclical clearance purposes, but is instead a switch that is pressed to stimulate demand – not in the way a flash sale operates, which might only last for 24 hours; it is switched on intended to just last for a short timeframe, but actually it can become far longer.
The pattern has been pretty clear historically – when times are hard and customer propensity to buy under pressure, retailers start to fall into the trap of a form of discounting that gets entrenched. The ones that are struggling push it the hardest, their competitors get drawn into it, and before you know it a widespread trend is established that many find it hard to stay out of.
That does appear to be where we are now. When compared to previous periods, the intensity of it is not significantly higher at the moment, but there is a difference worth noting. The below chart shows the percentage of all items sold that had a discount applied against them. The percentage hovers around the 50% mark for most of the two-year period covered by the chart, but the last four months have seen it stay above that point – the first time it has done so consecutively.
While it is quantifiably the case that it’s the first time that has happened, it has almost been the case several times over the past two years anyway.
So discounted products make up a major element of the overall sales mix and have been over the whole cost-of-living era. Is it getting more intense? Arguably, but only marginally so. Retailers would love to see an improvement in shopper confidence that will enable them to just shave a few percentage points off that chart…
More IMRG Insights
Join us on 18-19 September to access event more insights at the IMRG Optimisation Stage!
Latest News
-
)
Linnworks discusses AI hype, peak season readiness, and global marketplace opportunities, plus a session on how retailers can scale from £10 to £10M by embracing diversification and resilience. -
)
Klaviyo explores AI personalisation, retention, and community-driven commerce, plus a session on how brands like Wild are turning customers into loyal advocates through personalised experiences. -
)
Mapp explores how enriched product data unlocks discovery, cashflow, and margin gains, plus a session on why structured attribution is reshaping the future of retail. -
)
Marketing compliance is emerging as a competitive advantage in e-commerce, helping brands build trust, avoid costly penalties, protect platform presence, and future-proof growth by aligning with evolv ... -
)
Woo + Pressable share insights on ecommerce trends, peak season challenges, and the customer-centric innovations redefining digital commerce, plus a preview of their session on shifting shopper behavi ... -
)
Exploring AI adoption, evolving loyalty, and sustained peak season strategies, this perspective highlights how brands can stand out by staying curious and customer-focused in a fast-changing ecommerce ... -
)
Propeller Group’s Alex Humphries-French shares how exhibitors can cut through the noise at industry events with smarter PR—shaping stories, engaging media, and building lasting visibility before, duri ... -
)
Nova Tissue transformed its business with Temu, unlocking rapid e-commerce growth, boosting profitability, and creating jobs — all while navigating rising costs and shrinking traditional sales channel ... -
)
AI-driven personalization, economic uncertainty, and evolving consumer expectations are reshaping eCommerce. Ahead of eCommerce Expo 2025, discover insights on resilience, continuous learning, and why ... -
)
Bluestone PIM explores how AI personalization, composable commerce, and product experience management are reshaping eCommerce. From data challenges to omnichannel growth, discover insights, advice, an ... -
)
Gavin Holland, Global Head of UX Design at JD Sports Fashion, reflects on his career journey from BBC Worldwide to leading global UX at scale. He shares insights on collaboration, personalisation, AI- ... -
)
From bricks-and-mortar to digital transformation, this interview explores the evolving world of ecommerce trading at Primark, touching on performance metrics, stock strategy, and the customer-centric ... -
)
Despite Britain’s unpredictable weather, seasonal shifts significantly impact retail. While heatwaves drive demand in categories like appliances and outdoor gear, clothing sales remain sluggish due to ... -
)
Our media partner, The Paypers, has launched the Global Ecommerce Report 2025, teaming up with industry experts to bring you a guide to global expansion packed with insights to help you succeed. -
)
In eCommerce performance analysis, averages are essential — but they can also be deceptive. This article explores the limitations of relying solely on average figures, particularly in benchmarking sce ... -
)
From Walmart’s tariff-driven pricing backlash to Tesco’s leadership shakeup and Shein’s IPO detour, May saw pivotal changes across global retail. AI disruption, influencer marketing growth, and rising ... -
)
Growth Summit 2025 is officially open for registration. This new invite-only experience is designed for senior retail leaders who want to sharpen their strategy, connect with peers, and benchmark thei ... -
)
After such a long period of decline for the eCommerce market, where any positive growth gain made in one week would quickly be eliminated by a drop over the subsequent weeks, we can perhaps be forgive ... -
)
Currently UX Research Manager at Tesco, Serkan Ayan shares how human-centred research drives customer experience, how to scale UX in large organisations, and why curiosity is key to career growth in t ... -
)
The first edition of the Global Ecommerce Report highlights the transformative shifts in the ecommerce and payments industries. With the increased tendency towards globalisation, digitalisation, and h ... -
)
Miracle Inameti-Archibong, Head of Search at John Lewis & Partners, shares her approach to integrating SEO across channels, leading teams, and adapting to AI-driven changes in search. -
)
A few months’ ago, in this very series, I posited the idea that eCommerce might be making a bit of a comeback following years in the growth wilderness. The early weeks of the year were all positive fo ... -
)
Camilla Mackay-Wilson, Head of E-Commerce, Retail at Soho House, shares her career journey and insights into the world of eCommerce. She discusses her path from Marks & Spencer to leading digital stra ... -
)
The 2025 eCommerce Awards are now open for entries, and the search for the industry's best is officially on. -
)
Martina Guizzardi, Global Senior CRM & Loyalty Lead at Oner Active, shares key career lessons, consumer insights, and strategies for building lasting customer relationships. -
)
eCommerce Expo is delighted to introduce our newly formed 2025 Advisory Board – an impressive assembly of eCommerce visionaries poised to transform the event landscape. -
)
After years of decline, eCommerce is showing signs of recovery. What’s driving this shift, and is the industry finally bouncing back? -
)
Andy Mulcahy, Strategy and Insight Director at IMRG, reflects on the challenges and growth patterns of eCommerce in 2024, highlighting sector winners, market shifts, and what lies ahead for online ret ... -
)
We are delighted to announce the launch of Growth Summit 2025, an exclusive, invite-only event taking place on 24th September 2025 at ExCeL London, brought to you by eCommerce Expo and IMRG. Designed ... -
)
Discover how Frankie Thorogood built and scaled multi-million-pound eCommerce brands, navigated challenges, and learned invaluable lessons in entrepreneurship. From risk-taking to resilience, get insi ...
.png/fit-in/500x500/filters:no_upscale())
){kind=logo}
){kind=logo}
)
){kind=logo}
){kind=logo}
){kind=logo}
){kind=logo}
){kind=logo}
)
)
){kind=logo}
)
){kind=logo}
)
){kind=logo}
)
){kind=logo}
)
){kind=logo}
){kind=logo}
)
)
