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Week 4 — Coupons Are Algorithms

Thresholds, exclusions, stacking and bundles turn a shopping cart into a set of rules to work through, not a place to guess.

17 August 2026

Core question

When discounts have rules, how should they be combined?

A single reference price (Week 3) is one comparison. A cart with a coupon, a spend threshold, an exclusion, and free shipping has several rules at once. Treat each rule as an if-this-then-that step: if the cart meets the condition, the discount applies; if not, it doesn’t.

Thresholds and exclusions

Stacking and bundles

Some sites let two coupons apply together. Many do not. A few apply only the bigger discount. You cannot guess this from the badges; you have to read the rule text.

A bundle is a stacking rule dressed as a single product: “buy the headphones with the case for $20 more” is only a discount on the case, and only if the case is worth more than $20 to you specifically.

Rules, not tricks

The useful skill here is not memorising coupon tricks. Write down the rule, write down the cart, and check whether adding an item to reach a threshold costs more than the threshold saves. If it does, the “discount” made the purchase more expensive, not cheaper.

The $249 headphones

Suppose a $30-off coupon requires a $260 minimum spend, and a carrying case costs $25. Buying the case to unlock the coupon looks like “$25 case, minus $30 coupon” — but only if the case was worth buying at all; otherwise it’s $249 headphones plus a $25 item you didn’t want, minus $30, which is $244: five dollars cheaper than $249, and a case sitting unused in a drawer.

The arithmetic is easy. The part worth practising is how narrow the win is, and how fast it turns negative. Change the numbers below and watch where the verdict flips.

Gap to the threshold —

Cash cost if you add it and use the coupon —

Cash cost of just buying it, no coupon —

What the add-on actually cost you —

The last field is the one that matters, and it’s the one no checkout page asks you. “What is the add-on actually worth to you” is a number only you have, and a threshold coupon is profitable for the retailer precisely when shoppers leave it blank and assume it equals the price.

The $30 coupon, the $260 threshold and the $25 case are invented for this example. No real promotion is being described.

Learning outcomes

By the end of this week, you should be able to:

Before class

Find a real cart or checkout page that offers more than one discount rule at once — a threshold, a coupon code, a bundle, free shipping over some amount. Write down every rule’s exact condition, not just its headline percentage.

In class

Trade your cart’s rule set with another pair. Each pair tries to find a combination of items that satisfies every rule for the lowest total spend, then checks: did satisfying one rule — say, a spend threshold — force buying anything that, priced on its own, wasn’t worth it?

What you should leave knowing

A coupon system is a list of rules, conditions, and an order. Reading the rule text and calculating the right subtotal beats guessing from the badge.

This week has a full lecture — Lecture 3: Coupons Are Algorithms, whose slide deck works through the threshold-trap and bundle examples above live, and whose reasoning is exactly what Assessment 2, Beat the Shopping Cart, asks you to apply to a constrained cart of your own.


Where this goes

Week 5 asks whether $249, or $244, is even a meaningful number without knowing what this exact model has actually sold for over time.

The spec

What you bring to the session. Written so a reader can tell whether it has been met without asking you.

Teaching team