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Holiday Discounts: A Pricing Strategy Calculator

Shae Henrie

Content Strategist @ AdRoll

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With the holidays right around the corner, every brand owner has a big question in mind: How much should I be discounting my products?

For many businesses, whether established industry leaders or nimble startups, the holiday season is the biggest revenue driver of the year. With retailers slashing prices left and right, it can be tempting to do the same just to stay competitive, or at least increase sales.

We’re here to help take some of the promo-season stress away. Use this tool to craft a discount strategy while keeping your profit margins intact. Once you’ve nailed down precisely what deals to offer, make sure to launch a holiday campaign that promotes your sale far and wide and manage it with a cross-channel marketing platform that allows you to see how your strategy works across channels.

Psst: Don’t forget to segment your campaign for different first-time shoppers and repeat customer profiles to ensure they find the perfect gifts they need! 

Calculate Your Profits

Discount Calculator

Plug in the cost of the item and the markup, then experiment with different discount percentages and see how they affect your sale price, profit, and gross margin!

Sale Price
Original $0.00
Discount $0.00
Original $0.00
Discount $0.00
Gross Margin
Original 0%
Discount 0%

ℹ️ Prices rounded to nearest cent. Percentages rounded to nearest whole number.

Definition of terms:

  • Cost of item: How much it costs to manufacture the product.

  • Markup: The amount of overhead and profit added to the production cost.

  • Holiday discount: How much you’re planning to discount the product for the holiday season (as a percentage).

  • Sale price: How much the customer is paying.

  • Profit: Your revenue minus the cost of the item.

  • Gross margin: The higher the number, the more profitable your business.

Beyond these calculations, keep these tips in mind as well:

  • If you can’t afford to discount your products, explore alternative deals such as free shipping, extra loyalty points, or small freebies added to every order.

  • Be careful about discounting popular products — you want to ensure you have enough inventory at hand to last the entire holiday season.

  • Keep your discounting strategy as simple as possible — nobody likes having to calculate prices in their head!

Create Your Holiday Campaigns

Now that you've decided on a discount or sale, utilize the offer in your seasonal or holiday marketing strategy! Discounts are a great way to entice new customers. You may also consider making the sale more exclusive to a specific set of customers, like repeat buyers, to build brand loyalty as well as increase purchases.

Want more strategies and resources on creating a successful holiday campaign? Check out the guides below!

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