As on-demand marketplaces expand beyond food delivery into broader q-commerce and convenience offerings, retailers are rethinking their digital strategies. Promotions, once seen as tactical levers, are increasingly part of long-term investment plays, used to boost order value, shift consumer habits, and compete for attention in crowded marketplaces.
But how effective are these promotions, really? And what do they reveal about how different retailers approach growth?
RealityMine’s recent analysis of retail activity on major delivery platforms shows that promo usage and order value don’t always align —and in some cases, heavy investment in discounting may point to deeper strategic shifts.
Scatter plot showing "Merchant ABV vs. % Promo Usage (Last 90 Days)". Contains dots for named brands and other brands, each labeled.
This scatter plot maps retailers by two key metrics over the past 90 days:
The result is a snapshot of how different merchants perform — and behave — within the same ecosystem. From high-ABV, low-promo brands to aggressive discounters with modest basket sizes, each position on the chart offers clues about strategy, pressure points, and possible intent.
Retailers often expect promotions to lift total spend. The assumption is simple: offer a discount and shoppers will add more to their basket.
But that is not always what happens.
In many cases, promotions drive the transaction, not the basket size. Shoppers use the offer to reduce the cost of what they already planned to buy. The result is higher promo usage without meaningful ABV growth.
This analysis looks at that gap. By comparing promotion intensity with average basket value, it highlights whether discounts are truly building spend or simply sustaining demand in a competitive marketplace.
One quadrant of the chart shows high promo usage paired with relatively low order value.
This is not necessarily growth. It often signals competitive pressure. Increased promotion intensity may reflect a response to share loss, platform competition, or shifting shopper expectations. In this context, promos are a defensive lever, not purely a growth tool.
The goal may be to raise ABV over time. In the short term, however, heavy discounting often sustains volume rather than increases basket size. Promotions become a response to pressure, not a driver of incremental spend.
For established players, this creates strategic tension. Competing with brands willing to absorb short term margin impact changes the competitive dynamic.
At the upper left of the chart, retailers like Fiesta Mart and Stripes Convenience show high promo usage but relatively low order values. This suggests a shopper base that may be highly price-sensitive or conditioned to wait for deals. In these categories, promos might be less about basket-building and more about driving any transaction at all.
At the opposite end, Best Buy stands out with the highest ABV by far — and relatively low promo usage. The nature of what this merchant sells may be the reason behind it, Best Buy may have strong brand equity or offer necessity-based purchasing (e.g., specific tech or hardware needs).
Brands like Target, CVS, and PetSmart fall in the middle: moderate ABV, moderate promo usage. This might reflect a more balanced strategy— where promotions are used tactically rather than universally. It also suggests a customer base that spans a wider range of motivations, from convenience to brand loyalty.
More promotions do not automatically increase basket size. Discount dependency can train shoppers to wait for offers, making promos a requirement rather than a growth lever. Forward buying creates short term spikes but reduces future demand.
Frequent discounting can erode brand value, shifting perception toward price over quality or convenience. Irrelevant or poorly targeted offers further reduce impact, cutting margin without changing behaviour. Promotion volume alone does not drive growth. Context and execution determine results.
This dataset highlights an important nuance in retail behaviour: promotions don’t guarantee bigger baskets. Instead, promo effectiveness depends on the type of product, the brand’s positioning, and how shoppers perceive value.
High promo usage may signal a retailer’s dependence on incentives just to attract orders, not necessarily to boost spend. Meanwhile, high ABV with low promo reliance suggests brands that succeed without discounting heavily, likely due to necessity, perceived quality, or product exclusivity.
For retailers, this analysis underscores the importance of knowing when — and for whom — to deploy promotions. Blanket discounting might not be delivering the returns many expect. Strategic promo use, layered with shopper segmentation, could yield better outcomes.
For researchers and analysts, it’s a reminder that raw numbers like ABV don’t tell the full story. Behavioural context matters, and that’s exactly what real usage consumer data helps uncover.
RealityMine’s e-commerce data enables this kind of insight by capturing real consumer activity across apps, platforms, and time, helping brands and researchers move beyond guesswork to make smarter decisions.
Yes, promos still have a place in the toolkit but they’re not a one-size-fits-all solution. Understanding the relationship between discounts and shopper intent is key to designing more effective campaigns and building long-term value.
Want to understand how your brand compares, or how your customers really shop across digital platforms? Let’s talk.
Discount fatigue occurs when shoppers are repeatedly exposed to promotions and stop responding to them. In marketplace environments, this reduces the ability of discounts to lift basket size and turns them into a baseline expectation rather than a growth lever.
Frequent promotions can reset perceived value. Shoppers begin to anchor on the discounted price, making full price purchases less likely. This weakens pricing power and increases reliance on ongoing offers to sustain demand.
Discount dependency happens when order volume is sustained primarily through incentives. In the chart context, this appears as high promo usage without corresponding ABV growth. Over time, it limits margin flexibility and signals competitive pressure rather than strategic strength.
Sales volume can increase while contribution per order declines. If higher promo usage does not translate into higher basket value, revenue growth may mask margin compression.
Average basket value, incremental spend per order, margin contribution, and repeat purchase behaviour provide stronger indicators of performance. Promo usage alone does not reveal whether growth is efficient or sustainable.
