The Offer: $-Off vs. %-Off

“Get 50% off!”

“Get $50 off!”

Which offer will be most effective?

These two statements seem equally attractive because our consumer’s eyes are trained to locate discounts, deals, and offers. We often wait until we find the best deals available. Discount-based promotions have been used to attract customers since the dawn of business and advertising. There’s no doubt that it works.

So. Here’s the question. Which style of discount-based promotion ($ Off or % Off) will make customers flock to your product or service?

Think Like a Consumer

YOU:  Which style of promotion will be a better value to the consumer? 
CONSUMER: Which discount SOUNDS like a better deal?

As a general rule, the number that appears larger will most likely win the day. So, which discount-based promotion has the psychological edge?

Marketing research tells us that the Dollar-Off ($) approach receives better consumer response. Dollar-Off promotions do not require a lot of thought from the consumer. People are more willing to follow the black and white number rather than calculate the percentage of savings. After all, consumers have money in their wallets, not percentages of money.  

That being said, let’s give credit to the attraction of well-known percentages. Offers such as 25% off, 50% off or 80% off can be “X Marks the Spot” for consumers. Think about the success of Percentage-Off (%) promotions with regards to clearance sections or BOGO Sales. The percentage sign can attract customers if they can easily and quickly calculate the end-game. Turn your consumer mind and eyes on!

What type of promotion will work best for YOU?

The decision of whether to buy into a Dollar-Off ($) promotion or a Percentage-Off (%) promotion is very subjective. While the Dollar-Off approach may work well for some situations, the Percentage-Off discount style may be a better option for others.

Test it Out

The best strategy is to test it out! Pay attention to what offer your customers respond to. Whether you want to test the response across multiple mailing campaigns or send out both discount-based promotions at the same time, using a structured test is the strongest way to see which strategy works best for YOUR business.