Was the Discount Worth It? Measuring Promotion ROI
How to use the AskBiz Discounts Report to calculate whether a promotion generated enough additional revenue to justify the margin reduction — in three simple steps.
Key Takeaways
- The Discounts Report in Operations > Reports shows total discount value given, by promotion name and period.
- A promotion is ROI-positive if it generates incremental revenue greater than the discount value surrendered.
- Compare promotion weeks to non-promotion weeks using the same date range filter.
- The break-even uplift formula: discount % ÷ (margin % − discount %) = minimum revenue uplift needed.
The question every business owner should ask after a promotion
You ran a 20% off promotion last week. Revenue was higher than the week before. But was the promotion responsible, or was it just a busier week? And did the extra revenue cover the margin you gave away? AskBiz gives you the data to answer both questions precisely — through the Discounts Report and a simple break-even calculation that takes 5 minutes.
Step 1 — Find your total discount spend
Go to Operations > Reports > Discounts Report ('Promotions usage & discount totals'). Select the promotion period and note: (1) Total discount value given, (2) Number of transactions that used the promotion, and (3) Which promotion name was applied. If you ran 'Summer Sale 20%' and gave away KSh 4,200 in discounts across 35 transactions, that is KSh 4,200 of revenue you surrendered. This is your promotional spend.
Step 2 — Calculate the break-even uplift needed
Use the break-even formula: Discount% ÷ (Margin% − Discount%) = minimum revenue uplift needed. At 44% margin and a 20% discount: 20 ÷ (44 − 20) = 20 ÷ 24 = 0.83. You needed at least 83% more revenue during the promotion week than a normal week just to break even. If your Revenue was up 30% from the previous week, the promotion cost you money on a net basis. If Revenue was up 120%, the promotion was clearly profitable.
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See this in action for your business
AskBiz tracks these metrics automatically — just connect your data and start asking questions.
Start for free →Step 3 — Compare promotion period to baseline
Select Last 7 days in Reports to see the promotion week's Revenue and Gross Profit. Then change the date range to the equivalent week before the promotion (use the custom date range picker). Compare Revenue and — critically — Gross Profit (not just Revenue) between the two periods. A promotion that increases Revenue but reduces total Gross Profit has not worked. A promotion that increases both Revenue and Gross Profit has worked.
Common promotions that always hurt margin
Three promotion types consistently destroy margin without generating compensating uplift: (1) General 'everything 15% off' with no minimum spend — attracts existing customers at lower margin rather than new customers. (2) End-of-month discount right before payday — customers would have bought anyway. (3) Promotions not communicated externally — if only existing customers know about the discount, no new revenue is generated and you simply gave away margin to people who would have paid full price.
Building a promotion evaluation habit
After every promotion, complete this 5-minute review: Open Reports, compare promotion week to the same weekday baseline, check Discounts Report for total discount given, calculate whether Gross Profit increased or decreased. File the result as a note (even just in your phone) with the promotion name, discount offered, and outcome (positive/negative ROI). After 6 promotions, you'll have a clear picture of which types work for your business and which don't.