Revenue and orders · P&L lines 3, 5
Discount rate
How much of your list price you gave away.
Formula
(Price reductions + discount codes) ÷ GMV
Discount rate, in an ecommerce P&L, is price reductions plus discount codes as a share of GMV: how much of the list price was given away to make the sales happen. Splitting the two parts matters, because one is a catalogue decision and the other is a customer's.
A price reduction is a decision you made about the catalogue; a discount code is one a customer applied. A rising rate made of reductions is a pricing strategy, a rising rate made of codes is margin leaking through channels, and the same total can hide either.
Read it per product. A single line running at 25 percent discount inside a catalogue averaging 3 percent is a pricing decision, not a promotion, and it deserves to be looked at as one.
It is one of the two things that separates GMV from gross revenue, the other being shipping revenue, and the daily P&L tracker keeps a column for it precisely so the leakage stays visible next to the revenue it bought.