How to Overcome Limitations of Tier Pricing in Magento

What is Magento 2 Tier Pricing?

With Magento 2 Tier Pricing, merchants can set different prices for a product based on the quantity or volume of items a customer purchases. This encourages customers to buy in larger quantities by offering them discounts as they reach specific quantity thresholds.

Where to Define Tier Prices?

Merchants can define Tier Prices for Simple Products in the Magento backend. Go to Catalog > Products, and open a Simple Product. Underneath the Price you can see the Advanced Pricing option:

As depicted in the figure below, you have the option to include tier prices for a simple product within the “Customer Group Price” section. This feature allows you to configure tier pricing for various scenarios, such as across all websites, specific customer groups, and varying quantities. Additionally, you have the flexibility to set both fixed and discounted prices.

When to Use Fixed or Discount Price?

The decision between using a fixed price and a percentage discount depends on the pricing strategy and the specific context of your product or service. Here are some considerations:

• Use a fixed price when the price is not changed very often.
• Choose a percentage discount when the price is changed very often. It helps prevent oversight when updating prices. With a percentage discount, the tier pricing adjusts automatically based on the modified standard price, ensuring consistency and avoiding the need to manually update tier prices each time the base price changes. This approach streamlines the process, reduces the risk of forgetting to adjust tier prices, and maintains an accurate and dynamic pricing strategy.

How Does Magento Calculate Prices for Configurable Products?

Configurable products in Magento consist of a main product with multiple options or variations. Each option corresponds to a simple product in the catalog. The simple products represent the actual variations of the configurable product, such as different sizes or colors. Each simple product has its own price. When a customer interacts with a configurable product and selects a specific option (e.g., chooses “Medium” size or “Blue” color), Magento identifies the corresponding simple product associated with that selection. Magento then inherits the prices (regular price, special price, or any adjustments) directly from the chosen simple product. This ensures that the final price displayed to the customer is based on the specific option they selected.

For instance, if a configurable shirt has size options (Small, Medium, Large), and each size corresponds to a simple product with its own price, selecting “Medium” will result in Magento using the price of the simple product associated with the “Medium” size.

What about Tier Prices in Configurable Products?

By default, Magento allows to set tier prices only for simple products, but not for configurable products. This is shown in the figure below: If you open a configurable product, you cannot set any price data to it.

• Now we understand that Tier Pricing is a special pricing strategy that provides discounts based on the quantity purchased. In the context of configurable products in Magento, these tier prices are set for each individual simple product associated with a specific product variation (e.g., size or color).
• When tier prices are configured, they are defined on a per-product basis. In the case of configurable products, this means that tier prices are set for each simple product independently. Each simple product knows only its own tier pricing structure.
• Each simple product within a configurable product is designed to be aware only of its own price. It doesn’t have knowledge of the prices of other variations or simple products associated with the same configurable product.
• The implication of this setup is that if a customer wants to benefit from a tier price, they need to meet the specified quantity for a particular variation (simple product). In other words, to qualify for the tier price, the customer must purchase the required quantity of a single variation, and that quantity is specific to the tier pricing set for that particular simple product.
• For example, if the tier price for a “Medium” size shirt is defined as a discount when purchasing 10 or more, the customer would need to buy 10 or more units of the “Medium” size to enjoy the tier pricing for that specific variation.

In summary, tier prices in configurable products are determined on a per-simple product basis, and customers must meet the specified quantity for a particular variation to avail themselves of the tier price associated with that specific simple product.

In practice, the current approach of determining tier prices on a per-simple product basis for configurable products may not be ideal. Ideally, customers would prefer a more flexible pricing structure that offers a better price regardless of the specific size or color they choose to purchase. And that is where our modules come into place, which solve this problem

CustomGentos “Tier Prices For Configurable Products” Extension

Our extension Tier Prices For Configurable Products addresses this limitation by revolutionizing the computation of tier prices specifically tailored for configurable products within the Magento framework.

• The module collects the quantities of all the individual simple products associated with a configurable product. In the context of a configurable product with variations (such as sizes or colors), each simple product represents a unique variation.
• Using the aggregated quantity information, the module calculates the effective price as if the customer were purchasing only one variation of the configurable product. This means that the module considers the combined quantity of all selected variations.
• The calculation is based on the tier prices set for each individual simple product. The module takes into account the tier pricing structure of all the simple products associated with the configurable product.
• This approach allows customers to enjoy tier pricing benefits even when purchasing a combination of variations. It provides flexibility by considering the total quantity across different options and applying tier pricing discounts accordingly.

Consider a configurable product named “Awesome T-Shirt” with corresponding variations in “green” and “orange,” priced at 20 USD each. If you purchase five or more green shirts, the price drops to 18 USD each, and for five or more orange shirts, it becomes 16 USD each. Now, let’s say you add three green and two orange shirts to your cart. What would you anticipate? Ideally, you’d expect the shirts to be priced at 16 USD each or at least 18 USD each. However, with Magento, unfortunately, you’ll be charged the full 20 USD for each shirt.

With Tier Prices for Configurable Products, this issue is resolved. The extension ensures that when multiple variations of a configurable product are added to the cart, the tier price applied corresponds to the cumulative quantity of all variations. In the provided example, if the extension is integrated and configured to apply the lowest tier price, the customer would pay 16 USD per shirt (the lowest tier price for the “orange” variation) for the two orange shirts and 18 USD per shirt (the lowest tier price for the “green” variation) for the three green shirts.

Our module empowers merchants to decide how tier prices should be applied – whether to use the lowest, highest or respective tier price for the entire configurable product as shown in the figures respectively.

This flexibility allows businesses to align their pricing strategies with customer expectations and encourages bulk purchases by offering accurate and attractive tier pricing on configurable products within the Magento ecosystem.

However, without our module, the cart would look like this:

CustomGentos “Mass Update Tier Prices” Extension

As explained above, we have an excellent solution for merchants and customers to take full advantage of tier pricing for configurable products. However, we still need to define tier prices for each individual product. Fortunately, we also have a solution for that, our Mass Update Tier Prices extension.

This extension facilitates the streamlined process of updating tier prices for multiple products simultaneously in Magento 2. Instead of manually configuring tier prices for each product or variation, this extension allows you to make mass updates effortlessly with just a single click.

• Key Features:
  • The extension enables users to perform mass updates for tier prices across multiple products simultaneously.
  • Users have the flexibility to either add new tier prices to the selected products or replace existing ones. This provides convenience and efficiency in managing pricing structures.
  • In the case of configurable products, it’s crucial to emphasize that merely defining a tier price for one variation is insufficient. To ensure proper functionality, it is essential to add the newly configured tier prices to all variations associated with the product.

To use the extension, please follow these steps:

• Navigate to your product overview in the Catalog (Catalog > Products).

• Select the products for which you want to update tier prices.

• Choose “Actions > Update attributes” from the menu.

• Select “Mass Update Tier Prices” as the action.

• Add and configure the desired tier prices.

• Choose whether to complement or replace existing tier prices by checking or unchecking the relevant checkbox.

• Click “Save” to apply the changes.

In summary, the Mass Update Tier Prices extension enhances efficiency by simplifying the process of configuring and updating tier prices across multiple products in Magento 2.

Conclusion

Our Tier Prices For Configurable Products and Mass Update Tier Prices extensions offer a comprehensive solution to overcome the limitations of Magento’s default tier pricing system for configurable products and setting it to a group of products respectively. If you have any further questions or need assistance, please don’t hesitate to reach out. We are here to help!