There’s a moment in every retailer’s life when panic sets in. Sales are flat. The warehouse is full. The quarterly targets are laughing mockingly from the wall. And like a desperate gambler doubling down at 3 am, they reach for the nuclear option: “20% off everything!”

It’s the business equivalent of trying to fix a leaky pipe with a sledgehammer.

The discount death spiral

Most brands treat promotions like emergency flares—something you fire when sinking. The pattern is depressingly predictable: hit the panic button, blast discounts across every channel, watch conversion rates spike briefly, then stare at profit margins that now resemble a particularly aggressive game of limbo.

When you offer 20% off everything, you’re essentially saying, “Hey, remember that careful pricing strategy we spent months developing? Yeah, we’re just going to set fire to that now.” You’re training customers to wait for discounts while simultaneously devaluing your brand.

The intelligence alternative

Savvy retailers have figured out something revolutionary: the art of the targeted intervention.

Instead of carpet-bombing their entire customer base with discounts, they’re using data to identify the people who actually need an incentive to buy. The principle is elegantly simple: if someone will buy at full price, why show them a discount? If they do not buy, why waste a discount on them?

The magic happens in the middle—that group of maybe-buyers who just need the right nudge at the right moment.

Data meets psychology

Modern technology can track visitor behaviour and calculate something revolutionary: intent. By understanding where customers came from, what they’re looking at, and how long they’re staying, retailers can show the right offer to the right person at precisely the right moment.

The most effective strategies tap into psychology rather than just price reduction. Limited-time offers on specific products create urgency without devaluing your entire brand. It’s the difference between a surgical strike and carpet bombing.

(Flash sales work because they trigger our ancient hunter-gatherer instincts. “There’s only three left” hits the same psychological buttons as “winter is coming, better gather those berries now.”)

The segmentation game

The most fundamental mistake is treating all customers the same. A returning customer who’s bought from you five times has different motivations than someone who’s never heard of your brand. New customers need confidence-building, and returning customers need reasons to care.

Most retailers set up their welcome offer—say, 10% off for new customers—and treat it like a museum exhibit. They’re missing the fundamental truth that optimisation is a process, not a destination. What if 15% doesn’t convert more people? What if 5% works just as well? What if free shipping beats any discount?

You’ll never know unless you test.

The AI revolution

Artificial intelligence is transforming promotional strategy in two ways. First, generative AI creates thousands of offer variants quickly for large-scale testing. Second, behavioural AI processes vast amounts of visitor data to precisely understand customer intent, which would have been impossible just a few years ago.

Exit-intent campaigns—offers triggered when someone shows signs of leaving—work because they target the precise moment when intervention can make a difference. It’s the digital equivalent of a helpful shop assistant asking, “Is there anything I can help you find?” just as you’re about to walk out empty-handed.

The bottom line

The future of promotional strategy isn’t about bigger discounts or louder messages. It’s about smarter targeting, better timing, and treating each customer interaction as an opportunity to provide value rather than extract it.

Savvy retailers know that the right offer to the right person at the right time beats blanket discounting every time. They know that customer intent can be measured and influenced. They know that promotional strategy should protect margins, not destroy them.

They know that retailers who still carpet-bomb customers with “20% off everything” are making their jobs easier every day.

I featured on this Ecommerce Revamped episode to talk about RevLifter’s approach to offers and promotions. This article was written with the assistance of AI.