Percent off or dollar off: how to display a discount in your ads
Partner · Strategy, advertising and measurement
To display a discount in an ad, the most solid rule is the price of the item: under $100, the percentage looks bigger; above $100, the dollar amount looks bigger. A struck-through regular price next to the sale price helps when the discount is large, as long as that regular price is real, because Canadian law requires it and because an inflated reference price costs you trust. No study settles the question for a Meta ad in particular: you pick the format from the average price of your products, then confirm it with a test in your own account, measured on margin per visitor rather than click-through rate.
- Above roughly $100, "$60 off" convinces more than "20% off": three experiments published in 2016 confirm it. Under $100, the percentage tends to do better, without the difference being significant.
- A struck-through regular price raises the perceived value of large discounts. It adds nothing to a small, plausible discount, according to a meta-analysis of 20 studies.
- In Canada, a displayed regular price must have been the real price: half of sales or more at that price in the past year, or offered at that price more than half the time over six months.
- In Google Shopping, the sale price annotation gives a click-through rate lift of about 8% on the items that carry it, according to Google.
- The right test is judged on margin per visitor. A format that raises conversion but lowers average order value is not a win.
On this page
An eCommerce client asked us the question this week: in their ads, is it better to write "20% off", show the sale price with the regular price struck through, or give the value of the discount in dollars? Marketing research has answers on two of the three formats. Here is what it says, in five minutes, then how to decide for your store.
Percent or amount: the rule of $100
This is the best-established result. In 1998, Chen, Monroe and Lou showed that the same discount, presented in dollars on an expensive item and as a percentage on a cheap one, looked larger. In 2016, González, Esteva, Roggeveen and Grewal repeated the experiment three times: above $100, the dollar amount produces higher perceived value and purchase intention than the percentage. Under $100, the result reverses, but the difference is not statistically significant.
The explanation fits in one sentence: the customer remembers the bigger number and avoids doing the math. A 20% discount on a $300 coat is therefore written "$60 off". The same 20% on a $25 candle stays "20%".
Store tests point the same way. On a sign-up pop-up tested for two weeks with more than 20,000 visitors, "$15 off" converted 24% better than "12% off", for nearly the same value at the store's average order. It is a single merchant and the numbers come from the tool's vendor, but the direction matches the studies.
The Baymard Institute, which tests online stores with real users, reaches the same conclusion on the product page: "Save $100" hits harder than "Save 43%", and the best option is to show both.
The strikethrough price: only when the discount is large and the regular price is real
The regular price struck through above the sale price is a reference price. Krishna, Briesch, Lehmann and Yuan pooled 20 published studies on the question: the presence of the regular price raises the perceived value of large discounts, but adds nothing to a small, plausible discount. Their conclusion is direct: a large discount announces the regular price, a small discount can do without it.
Compeau and Grewal's review adds the condition that matters: the effect holds as long as the customer finds the reference price credible. A regular price nobody ever paid lowers the credibility of the whole ad, not just the discount.
The same logic applies to combinations. A struck-through price with "you save $60" next to it tells the customer what they gain without asking them to subtract. That is the layout Baymard recommends on product pages, and it carries over to an ad image.
What the law requires in Canada
A regular price displayed in an ad is an ordinary selling price claim under the Competition Act. It must pass one of two tests: the volume test (half of sales or more were made at that price, or higher, in the past year) or the time test (the product was offered at that price, or higher, more than half the time over the past six months). A "was" price, a "regular" price and an "after the promotion" price are judged the same way.
The penalties are not theoretical. Hudson's Bay paid $4.5 million over sleep sets rarely sold at the displayed regular price. Amazon paid $1 million for reference prices it could not substantiate.
The practical consequence is simple: a discount that never ends is not a discount. After a few weeks at the sale price, that price becomes the ordinary price and the strikethrough becomes misleading. Google applies a similar condition to its sale badge: the base price must have been in effect for at least 30 days within the past 200 days, and the discount must fall between 5% and 90%. We explain the same framework for reviews in the rules on customer reviews in Canada.
Three other ways to present the same promotion
More product rather than less price. Chen, Marmorstein, Tsiros and Rao compared, in store, a format that gave 50% more product with a discount of roughly equivalent value: the format with the extra product sold more. Customers compare the extra quantity to the percentage off without noticing that the base is not the same. The format suits consumable products and modest discounts; for a large discount, the customer prefers the lower price.
The dollar threshold. "$30 off orders of $150 or more" raises average order value, because the discount does not grow with the cart. A percentage with no cap, by contrast, applies to everything: 40% on a $2,000 cart gives $800 off. Shopify has no field to cap a percentage in dollars.
Free shipping. For a small cart, it is often worth as much as a discount in the customer's eyes and costs the store less. Klaviyo recommends testing it against a percentage on the first order, at equal value, then looking for the smallest incentive that still converts.
What the platforms show
In Google Shopping, the "Sale" or "Price drop" badge appears when the feed carries a regular price and a sale price. Google reports a click-through rate lift of about 8% on the items that carry it. That is a gain in clicks, not in margin: the feed is set up in Google Shopping: optimizing your product feed.
On the Meta side, no public study compares the three formats in an ad. The advertising policies only require that the discount be true and reject an inflated original price. The format is therefore settled by a test in your account, changing one thing at a time, as in how long does it take to test a Facebook ad.
How to decide for your store
Depending on your products
| Your situation | The format to display | What to check |
|---|---|---|
| Products under $100 | The percentage, with the dollar amount if there is room | That the percentage has a cap if the cart can grow |
| Products above $100 | The dollar amount, with the regular price struck through if the discount is large | That the regular price passes the volume test or the time test |
| Small discount, under 15% | The discount alone, without a strikethrough | That the promotion stays short |
| Consumables or multi-packs | More product rather than less price | That the larger format ships without extra freight cost |
| Low average order and expensive shipping | Free shipping above a threshold | That the threshold stays above the current average order |
Whatever the format, the test is judged on margin per visitor, not on click-through rate or even conversion rate. Intelligems, the most widely used price-testing tool on Shopify, says it plainly: a format that raises conversion by 10% but lowers average order value by 20% is not a win. And during the holiday peak, you test nothing: the calendar is in Black Friday and the holidays: when to prepare your advertising campaigns.
Frequently asked questions
Does 20% off or $20 off sell better?
It depends on the price of the item. Under $100, the percentage looks bigger than the dollar amount. Above $100, the dollar amount wins: "$60 off" on a $300 item convinces more than "20%". The customer remembers the bigger number.
Can I show a strikethrough price in my ads?
Yes, if that price was your real price. In Canada, it must pass the volume test (half of sales or more at that price in the past year) or the time test (offered at that price more than half the time over six months). A permanent discount makes the strikethrough misleading.
How long can a promotion last?
There is no fixed limit in the law, but the time test gives the benchmark: a product sold at the sale price more than half the time no longer has a regular price. Google, for its part, asks that the base price have been in effect for at least 30 days within the past 200 days before it displays its sale badge.
Should I show the discount as a percentage and in dollars at the same time?
When there is room, yes. The Baymard Institute recommends showing both on the product page. In an ad, the main format follows the price of the item, then the second one completes it if there is room without cluttering the image.
Our paid advertising expertise sets these formats with you, campaign by campaign. The goal Optimize the profitability of your digital campaigns describes how it unfolds.
- Shih-Fen S. Chen, Kent B. Monroe and Yung-Chien Lou, The effects of framing price promotion messages on consumers' perceptions and purchase intentions, Journal of Retailing, vol. 74, no. 3, 1998, pp. 353 to 372.
- Eva M. González, Esteban Esteva, Anne L. Roggeveen and Dhruv Grewal, Amount off versus percentage off: when does it matter?, Journal of Business Research, vol. 69, no. 3, 2016, pp. 1022 to 1027.
- Maestra, Nat'v Basics lifts pop-up conversion 24% with a $ offer, vendor case study, accessed November 2026.
- Baymard Institute, How to display price discounts on the product page: avoid these 4 pitfalls, accessed November 2026.
- Aradhna Krishna, Richard Briesch, Donald R. Lehmann and Hong Yuan, A meta-analysis of the impact of price presentation on perceived savings, Journal of Retailing, vol. 78, no. 2, 2002, pp. 101 to 118.
- Larry D. Compeau and Dhruv Grewal, Comparative price advertising: an integrative review, Journal of Public Policy & Marketing, vol. 17, no. 2, 1998, pp. 257 to 273.
- Competition Bureau Canada, 2022 amendments to the Competition Act, ordinary selling price claims, accessed November 2026.
- BLG, Discount deception: demystifying ordinary selling price claims under the Canadian Competition Act, May 2025.
- Mondaq, The Competition Bureau is wide awake: Hudson's Bay Company to pay $4.5 million for deceptive advertising and pricing practices of its sleep sets, accessed November 2026.
- Mondaq, Amazon to pay $1,000,000 to Competition Bureau for unsubstantiated sales prices, accessed November 2026.
- Google Merchant Center, About sale price annotations, official help, accessed November 2026.
- Haipeng (Allan) Chen, Howard Marmorstein, Michael Tsiros and Akshay R. Rao, When more is less: the impact of base value neglect on consumer preferences for bonus packs over price discounts, Journal of Marketing, 2012.
- Growthsuite, Percentage off discounts: the complete guide for Shopify, accessed November 2026.
- Klaviyo, Sign-up form best practices to push submit rates past 3%, accessed November 2026.
- Adstrong, Black Friday and Q4 Google Shopping: the playbook from Google's CSS team, click-through rate lift reported by Google, accessed November 2026.
- Intelligems, Should I use percentage off or dollar off?, accessed November 2026.
Gabriel almost always takes your first call and carries out your audit. He builds the strategy starting from your growth goal: where to put your budget, which market to test and how to connect each lead to a real sale in your CRM. He mainly leads engagements for three goals: Optimize the profitability of your digital campaigns, Develop a new market, and Generate demand and growth. With Geneviève, he also works on organic search (SEO), AI visibility (GEO) and conversion rate optimization (CRO). The sales a Google Ads or Meta Ads campaign brings in depend on the page that receives the click. He writes mainly about marketing strategy, paid advertising and measurement.
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