Online Dynamic Discount Codes

Overview

Online Dynamic Discount Codes allow customers to create custom-value discount codes for your online store by choosing how many points to redeem. This full-featured configuration includes purchase type options, subscription handling, and discount combinations.

Configuration

Enable/Disable Feature

Toggle the dynamic discount code feature on or off for your online store.

When Enabled:

• Eligible customers see the option in rewards
• Customers can create custom-value discounts
• All configured rules apply

When Disabled:

• Feature hidden from all customers
• Existing unused codes can still be used
• No new codes can be generated

Points-to-Currency Ratio

Set how many points equal one dollar of discount value.

Configuration:

• Enter ratio (e.g., 100 means 100 points = $1)
• Can be updated anytime
• New ratio applies to future claims only

Calculation Formula:

Discount Value = Points Redeemed ÷ Ratio

Examples:

Ratio: 100 points = $1

Customer redeems 500 points → $5 discount
Customer redeems 1,500 points → $15 discount
Customer redeems 5,000 points → $50 discount

Ratio Strategy

Consider your earning rate when setting the ratio. If customers earn 10 points per $1 spent and you use 100:1 ratio, they need to spend $10 to earn $1 discount (10% value). Lower ratios (50:1) provide more value, higher ratios (200:1) provide less.

Minimum Points Required

Set the minimum number of points customers must redeem.

Configuration:

• Enter minimum points (e.g., 500)
• Prevents very small discount values
• Ensures meaningful redemptions

Example:

Minimum: 500 points
Ratio: 100:1
Minimum discount: $5

Customer attempts 300 points → Error shown
Customer enters 500 points → $5 discount ✓
Customer enters 1,000 points → $10 discount ✓

Recommendations:

• Set minimum around $5 discount value
• Consider your average product price
• Balance accessibility with transaction costs

Maximum Points Allowed

Set the maximum number of points customers can redeem per claim.

Configuration:

• Enter maximum points (e.g., 5,000)
• Caps discount value per claim
• Protects margins

Example:

Maximum: 5,000 points
Ratio: 100:1
Maximum discount: $50

Customer enters 3,000 points → $30 discount ✓
Customer enters 5,000 points → $50 discount ✓
Customer attempts 6,000 points → Error shown

Recommendations:

• Set maximum around your average order value
• Consider 20-40% of average cart size
• Adjust based on profitability analysis

Purchase Type

Control whether discounts apply to one-time purchases, subscriptions, or both.

One-Time Payments Only

Discount applies exclusively to one-time purchases, excluding subscription orders.

Use Case: Reward occasional shoppers without affecting subscription economics.

Subscriptions Only

Discount applies exclusively to subscription orders.

Subscription Application Options:

Option	Description	Example
First Payment Only	Discount applies to the initial subscription payment	$20 off first subscription box
Multiple Recurring Payments	Discount applies to a specified number of payments	Customer chooses $15 off first 3 payments
All Recurring Payments	Discount applies to every payment for the subscription duration	$10 off every delivery

Use Case: Incentivize subscription signups with flexible discounts.

Both

Discount applies to both one-time purchases and subscriptions.

Flexibility: Configure different subscription behaviors when both are selected.

Customer Eligibility

Control who can see and use dynamic discount codes.

All Customers

Feature is visible and accessible to any customer in your loyalty program.

Use Case: Universal flexible redemption option.

Specific Customers

Select individual customers who can access this feature.

Configuration:

• Search for customers by name or email
• Add multiple customers individually
• Only selected customers see the option

Use Case: VIP benefits, service recovery, personalized offers.

Specific Customer Segment

Target customer segments created in Shopify.

Configuration:

• Select from Shopify customer segments
• Segments are created and managed in Shopify admin

Common Segment Examples:

• Customers who spent over $500 lifetime
• Customers with 5+ orders
• Gold tier customers
• Customers with 1,000+ points

Use Case: Tier-specific benefits.

Shopify Customer Segments

Customer segments are created in Shopify admin > Customers > Segments. Learn more in Shopify's customer segmentation documentation.

Discount Combinations

Control whether dynamic discount codes can stack with other discounts.

Combination	Description
Order Discounts	Can stack with order-level discounts
Product Discounts	Can stack with product-specific discounts
Shipping Discounts	Can stack with free shipping or shipping discounts

Default Behavior: If you don't select any combinations, only the dynamic discount will apply.

Setup Process

Step 1: Navigate to Dynamic Discount Codes

1. Open Keystone Loyalty Rewards app
2. Navigate to Loyalty Program > Rewards > Dynamic Discount Codes
3. Select Online tab

Step 2: Enable Feature

Toggle Enable Online Dynamic Discount Codes to ON.

Step 3: Configure Points-to-Currency Ratio

Field	Description
Points per Dollar	How many points equal $1 discount (e.g., 100)

Step 4: Set Point Limits

Field	Description
Minimum Points	Minimum points required (e.g., 500)
Maximum Points	Maximum points allowed (e.g., 5,000)

Step 5: Set Purchase Type

Choose one:

• One-time payments only
• Subscriptions only (configure subscription behavior)
• Both

If subscriptions are included, select:

• First payment only
• Multiple recurring payments (specify number)
• All recurring payments

Step 6: Set Customer Eligibility

Choose one:

• All customers
• Specific customers (search and select)
• Specific customer segment (choose segment)

Step 7: Select Discount Combinations

Enable combinations with:

• Order discounts
• Product discounts
• Shipping discounts

Step 8: Save Configuration

1. Review all settings
2. Verify ratio and limits align with your program goals
3. Click Save Configuration
4. Feature is now available for eligible customers

How Customers Use

Claiming a Dynamic Discount Code

1. Customer opens loyalty widget or visits account page
2. Customer navigates to rewards section
3. Customer sees "Create Custom Discount" option
4. Customer enters desired number of points to redeem
5. System displays calculated discount value in real-time
6. System validates points are within range and customer has sufficient balance
7. Customer clicks "Generate Code"
8. Points are deducted from balance
9. Unique discount code is generated and displayed

Using the Discount Code

1. Customer receives unique discount code
2. Code displays discount value (e.g., "DYNAMIC123 - $25 off")
3. Customer adds items to cart
4. At checkout, customer enters the discount code
5. System validates purchase type matches configuration
6. Discount is applied to the order

Code Display

After generating a code, customers can view it:

• In the loyalty widget
• In the discount generation confirmation
• In their transaction history

Refunds and Reversals

Automatic Refunds

Points are automatically refunded in these scenarios:

Scenario	Refund Behavior
Discount code deleted	Full point refund if unused

Manual Refunds

Customers and merchants can manually refund claimed discount codes to return points.

Customer-Initiated Refunds

Customers can refund their claimed dynamic discount codes through the loyalty widget:

Eligibility:

• Discount code has not been used
• Customer has the discount code in their account

Process:

1. Customer views their claimed discount codes
2. Customer selects the dynamic discount code to refund
3. Customer confirms refund
4. Points are returned to customer's balance
5. Discount code is deactivated/deleted

Refund Amount: Full points refunded if code is unused.

Merchant-Initiated Refunds

Merchants can refund discount codes on behalf of customers:

Process:

1. Navigate to Loyalty Program > Customers
2. Select the customer
3. View their claimed rewards/transactions
4. Select the dynamic discount code to refund
5. Confirm refund
6. Points are returned to customer's balance
7. Discount code is deactivated/deleted

Best Practice

Communicate with customers about refunds. If you refund a code, consider sending a notification explaining why points were returned.

Shopify Integration

Discount Creation

When a customer claims a dynamic discount code:

1. App creates discount in Shopify admin
2. Discount value set based on customer's point selection
3. Discount inherits all configured settings (purchase type, combinations)
4. Unique discount code generated
5. Code is linked to customer and transaction
6. Code is immediately usable at checkout

Viewing in Shopify admin

To view app-generated dynamic discounts:

1. Go to Shopify admin > Discounts
2. Filter or search for discounts
3. App-generated codes include "Dynamic" in the title
4. Click discount to view details, value, and usage

Use Cases

1. Universal Flexible Redemption

Configuration:

• Ratio: 100:1
• Minimum: 500 points ($5)
• Maximum: 5,000 points ($50)
• Purchase type: Both
• Eligibility: All customers

Goal: Give all customers flexibility while protecting margins.

2. VIP Exclusive Access

Configuration:

• Ratio: 100:1
• Minimum: 1,000 points ($10)
• Maximum: 10,000 points ($100)
• Purchase type: Both
• Eligibility: Gold tier only

Goal: Provide exclusive dynamic discount access to top-tier customers with higher limits.

3. Subscription Acquisition

Configuration:

• Ratio: 100:1
• Minimum: 500 points ($5)
• Maximum: 3,000 points ($30)
• Purchase type: Subscriptions only (first payment)
• Eligibility: All customers

Goal: Let customers choose their subscription signup discount.

4. Entry-Level Accessibility

Configuration:

• Ratio: 200:1
• Minimum: 200 points ($1)
• Maximum: 2,000 points ($10)
• Purchase type: One-time only
• Eligibility: All customers

Goal: Allow frequent small redemptions to maintain engagement.

Best Practices

1. Set Strategic Ratios

Align your ratio with earning rate and desired value:

Example Analysis:

Customer earning rate: 10 points per $1 spent
Ratio: 100:1 (100 points = $1 discount)

Customer spends $10 → Earns 100 points → Redeems for $1 discount
Effective value: 10%

If ratio changed to 50:1:
Customer spends $5 → Earns 50 points → Redeems for $1 discount
Effective value: 20%

Guidelines:

• Higher ratio (200:1) = More profitable, less attractive
• Lower ratio (50:1) = Less profitable, more attractive
• Match earning rate for predictable economics

2. Set Meaningful Minimums

Ensure minimum discounts motivate redemption:

Recommendations:

• Minimum $5 discount (500 points at 100:1)
• Consider average shipping cost
• Test and adjust based on redemption data

3. Cap Maximums to Protect Margins

Set maximum at sustainable levels:

Guidelines:

• Maximum around average order value
• Consider 25-50% of average cart
• Review profitability regularly

4. Monitor Redemption Patterns

Track how customers use the feature:

Key Metrics:

• Average points redeemed per claim
• Distribution (min, middle, max clustering)
• Redemption frequency
• Order value when using dynamic discounts

Related Features

• Dynamic Discount Codes Overview - Feature overview
• POS Dynamic Discount Codes - POS configuration
• Order Discount Rewards - Fixed-value alternatives
• Customer Tiers - Segment-based eligibility
• Transactions - View claims and usage

Summary

Online Dynamic Discount Codes provide maximum flexibility for customers shopping on your online store. With full control over purchase types, subscriptions, and discount combinations, you can create a sophisticated flexible redemption system that drives both one-time and subscription purchases while maintaining profitability through strategic ratios and limits.