Discounts and coupons: a strategy that protects revenue
26 Sept 2026 · 2 min read · By the Knock team
Key takeaways
- Prefer time-limited or purpose-specific discounts over permanent ones.
- Decide in advance who can approve what.
- Track discounted MRR separately to understand real price realisation.
Discounts can win deals and reduce churn, but careless ones erode margin and set expectations you cannot undo.
Types of discount
- Percentage off: easy to understand, scales with plan size.
- Fixed amount: predictable cost to you.
- Time-limited: for example 20% for the first three months.
- Prepayment incentive: a reward for choosing an annual plan.
- Volume: lower unit price above certain quantities.
Principles
Give a reason
A discount tied to something, such as annual prepayment or a case study, is easier to defend than a random reduction.
Set an end date
Recurring discounts that never expire quietly lower your revenue forever. Add an end date and a reminder before it lapses.
Limit the stacking
Decide whether coupons combine with other offers. Usually they should not.
Approval rules
Let the team offer a modest discount freely and require sign-off beyond a threshold. Write it down so every deal follows the same logic.
Measure it
- Percentage of customers on a discount.
- Average discount depth.
- Retention of discounted vs full-price customers.
Knock supports discounts on quotes and subscriptions so agreed terms appear on the invoice automatically.
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