Pricing case: stopping an unprofitable promotion
A discount looked attractive in revenue projections but failed contribution-margin checks.
Direct answer
The promotion was paused because the discount pushed break-even ROAS above the campaign’s realistic performance range.
Context
The team planned a 25% discount to lift first-order conversion during a seasonal campaign.
Actions taken
The useful part of this case is the operating sequence, not a generic success claim.
- Calculated contribution margin after product cost, shipping subsidy, payment fee, and expected returns.
- Compared the new break-even ROAS with recent campaign performance.
- Replaced blanket discount with a bundle and threshold gift.
Result and lesson
The final offer protected margin while still giving ads a stronger hook than the original full-price page.
FAQ
Why not test the discount anyway?
You can test, but only with a capped budget and clear loss threshold. The original plan had no guardrail.
What metric caught the problem?
Break-even ROAS and contribution margin exposed that the campaign would need unrealistic efficiency.
Why did a bundle work better?
The bundle raised perceived value and AOV without cutting every item’s margin equally.