Discounting is a patience problem
When in doubt, all the marketers I know turn to a discount. You want more volume, you increase the discount. Revenue looks short or ad spend is creeping up, and the answer that comes back is a promo. I think the reason is older than e-commerce.
You only have four levers
If you go back to the old four Ps of marketing, you only have four levers you can pull. The product itself, what you charge for it, where people can buy it, and the promotion of it, meaning the messaging, the ads, the email, the content. Promotion in the four Ps doesn't mean a promotional discount. A discount is a price move, and price is only one of the four.
Only one lever is fast
For DTC, your shelf is fairly fixed. We're omni-channel, and placement is a thing you can push on, but it takes a lot of time and it's slower. The product lever is pretty slow too, that one means changing the product itself or launching something new, and it's at least a few months of work. Promotion is the messaging around the product, and it drives longer-term demand and consumer behavior, so you don't see most of it right away.
Price is the only one that moves results in real time. You can change it in the morning and see it in the numbers that night.
The impatience machine
We're very impatient as marketers. E-commerce businesses run day-to-day and week-to-week, speed is king, so there's no patience for the longer-term thinking, things like placement, like product, like promotion. Day to day, the levers a marketing team actually has its hands on are promotion and price. When leadership asks why revenue is short or why ad spend is up, the KPI is topline, and of those two, only price answers in real time, so that's the one that gets pulled, partly from the pressure and partly because right now it's just what gets rewarded.
Most teams basically neglect almost everything but price.
Planned versus reactive
Price is a fine lever both up and down, I just think it's over-pulled. Moving price with a plan is valuable, and we do it. We've raised realized prices on purpose, and we still pull the discount lever hard in Q4, inside one tight window that gets planned before the season starts.
The problem is the reactive moves, when a discount goes live because the week looks soft. That's maybe the biggest point in this piece.
What we did about it
When we killed everyday discounting, the commitment was to a longer-term view. We removed the team's ability to pull the fast lever in the near term, which meant the only levers left were the slow ones, and that's where the time went, into placement, into product, into all the elements of promotion, into the pages where we sell. We gave up some short-term results for longer-term demand, and so far it's paid off.
The part I'd add for the people running the P&L is that the only one who can make the decision to change this is you. No one else will do it. The KPIs that make price the default are the ones you set.
The next time somebody asks why revenue is short, notice which lever your hand goes to. Most of us just need to be more patient.