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/ Discounts

What is the consumer psychology of discounting?

What is the consumer psychology of discounting?

As a business owner, you’ve probably asked yourself this question a lot: what more can I do to motivate consumers to buy from us? You’ve probably wondered - do consumers shop based on logic or emotion?

These are all fascinating questions. According to a study by Harvard professor, Gerald Zaltman, people mostly make purchase decisions based on emotion and their subconscious feelings.

The million-dollar question? How can you better understand the psyche of your target audience to persuade them to buy from you? What tactics can you apply to appeal to their subconscious mind?

A tactic that has been tried and true across retailers of all categories is discounting. Studies show that discounts can have a hugely positive impact on sales, with many modern consumers seeking out promo codes, discounts, and sales.

Let’s take a closer work at the consumer psychology behind why product discounting works so well.

Perception of value is everything


Discounting is all about creating the perception of great value. After all, who doesn’t love a good bargain? Most customers don’t delve deep enough to find out whether the offer is more valuable than the discounted price they’re paying for it. Merely seeing that discounted price tag is often sufficient to convince them to buy.  

If consumers perceive that they’re getting a good deal and value for money, they’re much more likely to be inclined to buy.

Consumers are likely to act more quickly to get their hands on limited-time discounts


Want to motivate your customers to buy quickly? Set your discounts for a limited period. When consumers believe that they can only access this great deal for a limited time, they’re much more likely to be motivated to move more quickly. This is especially true if they believe that they are getting their hands on a quality product that is more expensive than your competitors.

The next important point then is setting your discount price and time in the context of your competition. If you are discounting an accessible and widely available product across many retailers, you don’t need to set such deep discounts. You need to ensure that it is cheaper for consumers to buy from you than from any of your key competitors.

With a majority of consumers currently shopping online, online research is extremely common as customers seek out the best deals. If you are consistently offering discounted goods that provide customers with a small saving, you’ll build a reputation as a brand that offers excellent value for money. So even when you aren’t in a discount phase, customers may have developed a perception of you as a value brand.

For more tips on how to create a discount campaign, you can read our checklist for a profitable discount campaign.

Discounts can create brand loyalty


Are you looking for a quick and easy way to attract new customers? Offer a discount to incentivise those who have never tried your product before. It's much easier to convert customers to repeat customers once they get a taste of the quality of your product and the level of your customer experience.

When you offer regular discounts to your customers, they will see you as a retailer that offers value for money. Other than the short-term spike in sales while your discount is running, you're likely to retain customers by providing more regular discounts.

You can also take this a step further by providing a discount progression system to your most loyal customers to keep them coming back.

Need a little extra help creating your discount campaigns?

At OMG, we can help you create personal discount campaigns that serve to reward your most loyal customers.


We are developing free tools for merchants that help you create dynamic discount campaigns. You can communicate the value of your offer to your new customers. You can easily distribute limited-time-only promotions. And reward customers who keep coming back. All in one place.

When you sign up at, our team will get in touch and we can discuss how we can help you increase sales and retain more loyal customers.

Alexey Gutin

Read more posts by this author.