# Free gift vs discount calculator

> Free gift vs discount calculator. Compare a free gift and a discount at the same order threshold and see which keeps more profit each month.

Free, no sign-up, runs in the browser: https://analify-ai.scalyax.ai/tools/free-gift-vs-discount-calculator

Both offers push customers to spend more. Compare a free gift and a percentage discount at the same threshold and see which one keeps more profit.

## What it calculates

A threshold offer earns extra margin on the bigger baskets it creates. A free gift costs you the gift's product cost on each order. A discount costs a share of the whole order. When the gift costs less than the discount amount, it keeps more profit for the same push.

## Formula

```
Extra profit = (Threshold − AOV) × orders × margin
With gift = Extra profit − gift cost × orders
With discount = Extra profit − threshold × discount × orders
```

## Worked example

Inputs:
- Current AOV: USD 55
- Order threshold: USD 75
- Orders per month: 1000
- Margin: 45%
- Gift cost: USD 5
- Discount at the threshold: 10%

Results:
- Keeps more profit: Free gift
- Profit with the free gift: USD 4,000
- Profit with the discount: USD 1,500
- Difference per month: USD 2,500
- AOV jump needed: 36.4%

## What changes the result

Gift cost at five values; every other input as in the example.

| Gift cost | Keeps more profit | Profit with the free gift |
| --- | --- | --- |
| USD 2.50 | Free gift | USD 6,500 |
| USD 5 (example) | Free gift | USD 4,000 |
| USD 7.50 | Free gift | USD 1,500 |
| USD 10 | Discount | -USD 1,000 |
| USD 15 | Discount | -USD 6,000 |

## How to read the result

This assumes every order moves up to the threshold, so read it as a best case for both offers.
A gift people value more than it costs you is usually the stronger offer.

## Questions

**Is a free gift better than a discount?**
When the gift costs you less than the discount amount, yes. It pushes the same basket and keeps more margin.

**What makes a good free gift?**
Something customers value above what it costs you, that matches the products they already buy.

**Why is this a best case?**
It assumes every order reaches the threshold. In practice only some do, so both results will be smaller.

**Do you store what I enter?**
No. The calculation runs in your browser and nothing is sent to Analify.

## Use your real numbers

Analify reads order values, product costs and discount codes from Shopify, so you can compare offer periods in Blended Profit. Analify reads 4 of these 6 inputs live. Try the calculator: https://analify-ai.scalyax.ai/tools/free-gift-vs-discount-calculator

More free ecommerce calculators: https://analify-ai.scalyax.ai/tools