Overview

Amazon's coupon feature allows sellers to offer discounts that attract buyers, but the budget mechanics behind coupons aren't always intuitive. Understanding how coupon budgets are calculated, depleted, and managed is essential for sellers who want to run promotions without unexpected overspend. This guide breaks down the key details of how Amazon handles coupon budget allocation and depletion.

Key Points / What Sellers Need to Know

• Budget range — Sellers can set a coupon budget anywhere from $100 to $10,000,000, giving flexibility for both small test campaigns and large-scale promotions.
• Budget equals total discount value — The budget represents the total amount of discounts you're willing to fund, calculated as the per-unit discount multiplied by the number of redemptions.
• 80% threshold triggers deactivation — Amazon automatically takes your coupon offline once 80% of your budget has been consumed through customer redemptions.
• 20% reserve for pending clips — The remaining 20% of your budget is held in reserve to honor redemptions from customers who clipped the coupon before it was deactivated.
• Fees are separate from budget — Coupon participation and performance fees do not reduce your coupon budget. These charges are billed independently.

How Coupon Budget Depletion Works

When a customer clips and redeems your coupon by purchasing an eligible product, the discount amount counts against your budget. For example, if you offer a $4.00 coupon on a $25.00 product and 50 customers redeem it in one day, that's $200 deducted from your total budget. Amazon calculates this on a simple formula: the discount per unit multiplied by the number of redemptions. Budget depletion is reflected the following day, so there is a slight lag between when redemptions occur and when you see the spend reflected in your account.

The 80/20 Rule and Overspend Risk

One of the most important mechanics for sellers to understand is the 80/20 budget split. When your coupon reaches 80% of its budget, Amazon stops showing the coupon to new shoppers. However, the platform allows customers who have already clipped the coupon a grace window of approximately 30 minutes to complete their purchase and redeem the discount. The remaining 20% of your budget is reserved specifically to cover these late redemptions. If demand is high and the redemptions during that 30-minute window exceed the 20% reserve, your total spend can actually surpass your original budget. This means sellers running high-traffic promotions should be aware that the budget is not a hard cap but rather a target with some flexibility built in.