Below is a practical, ready-to-run playbook for using free-gift promotions to increase sales on Shopify — covering strategy, what to test, how to implement, margin math, messaging, tracking, and a launch checklist you can use right away.

1. Goal and promotion types (pick one primary goal)

• Goals: raise average order value (AOV), increase conversion rate, clear slow-moving inventory, acquire email subscribers, or reward loyalty.
• Promotion types:
  • Gift with purchase (GWP) at a cart-value threshold (e.g., free tote over $75).
  • Buy X, get Y free (e.g., buy 2, get a free sample).
  • Tiered gifts (better gift when spend increases).
  • First-order gift (welcome gift to new customers).
  • BOGO / “add the cheaper item free.”
  • Time-limited free gift (creates urgency).
  • Gift for referral or after sign-up.

2. Which implementation method to use on Shopify (pros/cons)

• Built-in Discounts (recommended first):
  • Use Shopify’s “Buy X get Y” or automatic discount rules to add a free item when cart conditions are met. Good UX — automatic application at cart/checkout.
  • Pros: no app, straightforward for simple rules. Cons: discount stacking/automatic discount limitations; some plans or checkout customizations may affect behavior.
• Shopify Scripts (Shopify Plus):
  • Use Scripts to automatically add/replace items in cart and run complex logic (e.g., only one free gift per customer, priority rules). Best for complex or high-volume stores.
• Apps from the Shopify App Store (recommended if you need features not possible with discounts):
  • Use “Gift With Purchase” / “Free Gifts” / upsell apps for advanced behaviors: show a gift popup, allow customers to choose a gift, limit redemptions, smart inventory handling, or show gift progress bars.
  • Pros: richer UX, selection, reporting. Cons: extra monthly cost; check reviews/integration.
• Coupon codes:
  • Use codes for marketing channels (email/social). Less seamless than automatic gifts but useful for tracking channel performance.

3. Rules & logistics you must set before launch

• Define eligibility: threshold (cart subtotal before tax/shipping?), specific collections or SKUs, new vs returning customers, one-per-order vs one-per-customer, exclusions (discounted or clearance items).
• Stock & SKU: create a gift SKU (hidden if needed) so inventory is tracked and returns are handled cleanly.
• Shipping & tax: decide whether gifts count toward free shipping thresholds; check if gifts are taxable in your region — in the US many states tax tangible goods even if free, depending on rules.
• Returns policy: decide if returns on purchased items require return of the gift (communicate clearly).
• Fraud & abuse: limit one redemption per customer or email, add expiration for the promo, or require verified accounts for high-value gifts.

4. Messaging & site UX (how to present the gift)

• Homepage/banner: concise value-first headline (e.g., “Free gift when you spend $75 — while supplies last”).
• Product pages: show progress bar toward the free gift to nudge add-to-cart behavior.
• Cart drawer: show eligibility status (e.g., “Spend $12 more to get a free travel kit”).
• Checkout & email: confirm gift is included in order confirmation and shipment emails.
• Upsell popups: offer the gift as a one-click upgrade when threshold is nearly met.
• Social/ads/email: highlight scarcity, deadline, and the gift’s perceived value.

5. Margin math: set the right threshold

• Simple rule of thumb: set threshold at ~20–40% above current AOV so the promotion increases AOV rather than simply shifts purchase timing.
• Quick calculation example:
  • Current AOV = $50. Target AOV increase = 30% → target AOV = $65.
  • Gift landed cost = $5. Marketing/fulfillment per order = $3.
  • Required threshold ≈ target AOV + gift & costs buffer = $65 + $8 = $73 → round to $75.
• Ensure gift cost per redeemed order < expected incremental gross profit from the higher AOV.
• Track net margin impact: incremental revenue – (gift cost + extra shipping + marketing).

6. What to measure (KPIs)

• Redemption rate (gift redemptions / eligible sessions).
• Change in AOV (compare period baseline).
• Uplift in conversion rate (A/B test or time-based comparison).
• Incremental revenue and incremental margin (v. baseline period).
• Return rate on orders with gifts.
• Customer lifetime value (if gift increases repeat purchases).
• Channel performance (which channel drove most redemptions).

7. A/B test plan (minimum)

• Test 1: Control vs single free-gift at X threshold (see AOV) — measure conversion/AOV.
• Test 2: Threshold level (e.g., $75 vs $95) — which balances lift vs margin.
• Test 3: Gift type (high perceived value small-cost item vs small monetary discount).
• Run each test for statistically meaningful sample (or at least 2–4 weeks and ensure minimum conversions).

8. Copy templates (quick)

• Banner: “Free [gift name] with every order $75+ — limited quantities.”
• Cart nudging: “Add $12 to your cart to get a free [gift name].”
• Email header: “Your free gift awaits — spend $75 to claim it”
• Checkout confirmation: “Congrats — you qualified for a free [gift]. We’ve added it to your order.”

9. Launch checklist (go-live)

• Create gift SKU and set inventory.
• Configure discount rule or app and test on staging/storefront.
• Add banners, cart messaging, and progress bar.
• Update terms & FAQ (shipping, tax, returns).
• Test full flow (add, meet threshold, check cart, checkout, confirmation email).
• Set tracking (UTM tags for ads, goal in analytics, eCommerce events).
• Schedule monitoring for first 72 hours (redemptions, inventory hit, errors).

10. Common pitfalls and how to avoid them

• Pitfall: gifts eat margin. Fix: choose high perceived/low cost items or set threshold higher.
• Pitfall: customers gaming the system. Fix: single redemption rules, require sign-in, or limit one gift per order.
• Pitfall: poor UX where gift is not added at checkout. Fix: thorough QA on desktop/mobile and on different payment methods.
• Pitfall: returns unclear. Fix: explicit returns policy for gifts.

Quick action plan (first 7 days)

1. Pick promotion type + target KPI (AOV +%).
2. Choose gift SKU(s) and confirm landed cost.
3. Build the rule in Shopify (automatic discount / app).
4. Add banners and cart messaging.
5. QA entire purchase/checkout flow.
6. Launch with an email + social push and track UTMs.
7. Monitor metrics daily for week 1, then A/B test refinements.

If you want, I can:

• Draft banner, cart, and email copy tailored to your product & brand tone.
• Calculate the ideal threshold given your current AOV, gift cost, and margin (tell me your AOV, gross margin %, and gift unit cost).
• Recommend specific Shopify app features to look for if you want app suggestions.

Which of those would you like me to do now?