Discount Rate

Deciding the right discount level is crucial for attracting product testers and maximizing the effectiveness of your campaigns on Lutendo. This comprehensive guide explains how to set discounts that not only attract testers but also optimize your costs and achieve your campaign objectives.

Before diving into how to set your discount rate, it’s essential to understand the financial mechanics behind Lutendo campaigns:

Product Cost Return: The cost of discounts you offer is returned to you indirectly through the campaign process.

Sales Channel Earnings: When a product is sold through a campaign, you earn revenue through the sales channel (e.g., approximately 25% on Amazon or 40-50% on Amazon FBA, varying by platform).

Refund Process: After the campaign objective is completed, you will refund the tester partially or completely, depending on your chosen discount rate.

Not Included in Subscription Plans: Product discount costs are not included in any Lutendo subscription plans. These are separate expenses you need to account for.

When planning your campaign budget, keep in mind:

• Additional costs for purchasing your products are required beyond the regular Lutendo service fees.
• These product costs must be deposited into your Lutendo account using crypto deposit or cash deposit.
• Product costs are not visible in the shopping cart when booking a subscription.
• The total product cost depends on your item prices, determined discount price, and the number of reviews purchased.

Example Calculation:

If your discount is €10.00 per item and you order 50 reviews:

• Total product cost deposit: 50 x €10.00 = €500.00
• This €500.00 should be deposited into your Lutendo account.
• You will receive this amount indirectly from sales on the respective channel, minus commissions and additional costs.

• Understand the Impact of Discount Levels:
  • Higher discounts (e.g., 100% cashback) are very attractive to testers.
  • They can significantly boost participation and product rankings on marketplaces.
• Calculate the Actual Cost of Discounts: Consider all factors in your discount calculation. For example:
  • Retail Price: €20
  • Discount Offered: €12 (60% off)
  • Marketplace Fees: Assume 15% (€3)
  • Shipping Costs: €2.50
  • Your Net Cost: €5.50 (after marketplace reimbursement, excluding fees and shipping)
• Effective Use of Discounts:
  • Higher discounts can lead to more reviews and better visibility.
  • The net cost to you is minimized by the reimbursement mechanism.
• Leverage Your Campaign Objectives:
  • For rapid increase in reviews and rankings: Consider higher discounts.
  • For maintaining profitability: Balance attractiveness with your margins.
• Monitor and Adjust:
  • Start with an initial discount and monitor campaign performance.
  • Increase discount if participation is low; decrease if objectives are easily met.

• • No Extra Fees for Reviews: Lutendo doesn’t charge additional fees for submitted reviews, making cashback sales an attractive option for boosting rankings.
  • Balance Attractiveness and Profitability: Your discount should be enticing enough for testers but also allow you to maintain a healthy profit margin.
  • Consider Long-Term Benefits: Higher initial discounts might lead to better long-term sales through improved product visibility and rankings.

Setting the right discount for your Lutendo campaign involves understanding both the attractiveness of the offer to testers and its financial implications for your business. By carefully considering these factors and utilizing the unique features of Lutendo’s platform, you can design campaigns that are both effective in achieving your marketing objectives and cost-efficient in the long run.

Remember, the key is to find the sweet spot where your discount is attractive enough to drive participation while still allowing you to benefit from the increased visibility and sales your campaign generates.