Enhanced Discount use cases

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Applying enhanced discount to recurring charges

You can compare the results when the Enhanced Discount feature is enabled and disabled for discount charges in the following use cases to decide whether to use the Enhanced Discount feature and how to specify the discount duration.

The use cases below are grouped based on the length comparison between the charge billing period and the discount duration.

How to understand Zuora use cases?

Before reading the following use cases, ensure you have the following knowledge:

Enhanced Discount enabled for a discount charge means that the Allow apply to billing period partially checkbox is selected for the discount charge. For more information, see Manage Enhanced Discount.
The “charge” in this article refers to a regular charge except for delivery pricing, prepayment and drawdown, and discount charges.
The results below are based on the following billing rules values. If you set the billing rules to other values, your results will differ slightly.
- When prorating a month, assume 30 days in a month or use actual days: Use actual number of days
- When prorating periods greater than a month, prorate by month first, or by day: Prorate by day
No matter whether the Enhanced Discount feature is enabled or not, during a period that has already been billed, if the charge is not changed, discount changes during the billed period, such as creating, updating, or removing the discount charge, will not be processed by the rating engine in the next invoice.

Charge billing period is longer than discount duration

If your charge billing period is longer than the discount duration, refer to the following use cases.

Use case 1.1: Start dates of charge and discount are aligned

The diagram below shows that the start dates of a charge and discount are aligned on 06/01/2023.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not.

Table 1.1
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July	August	September	October	November	December	January	February	March	April	May
1.1.a	10%	Unchecked	N/A	-120	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10
1.1.b	10%	Checked	N/A	-30	-10	-10	-10	0	0	0	0	0	0	0	0	0
1.1.c	$10	Unchecked	Month	-10	-10	0	0	0	0	0	0	0	0	0	0	0
1.1.d	$10	Checked	Month	-30	-10	-10	-10	0	0	0	0	0	0	0	0	0

For the 1.1.b percentage discount, the total discount is - $30 = - $100/month * 10% * 3 months.
For the 1.1.d fixed amount discount, the total discount is - $30 = - $10/month (Fixed Amount Discount Billing Period) * 3 months.

Use case 1.2: Start dates of charge and discount are not aligned

The diagram below shows that the start dates of a charge and discount are not aligned.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not.

Table 1.2
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	March	April	May
1.2.a	10%	Unchecked	N/A	0	0	0	0
1.2.b	10%	Checked	N/A	-30	-10	-10	-10
1.2.c	$10	Unchecked	Month	0	0	0	0
1.2.d	$10	Checked	Month	-30	-10	-10	-10

For the 1.2.b percentage discount, the total discount is - $30 = - $100/month * 10% * 3 months.
For the 1.2.d fixed amount discount, the total discount is - $30 = - $10/month (Fixed Amount Discount Billing Period) * 3 months.

Charge billing period is the same as discount duration

If your charge billing period is the same as the discount duration, refer to the following use cases.

Use case 2.1: Start dates of charge and discount are aligned, fixed amount discount

The diagram below shows that the start dates of a charge and discount are aligned on 06/01/2023.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not.

Table 2.1
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July	August	September	October	November	December	January	February	March	April	May
2.1.a	$15	Unchecked	Quarter	-15	-15	0	0	0	0	0	0	0	0	0	0	0
2.1.b	$15	Checked	Quarter	-60	-15	0	0	-15	0	0	-15	0	0	-15	0	0

For the 2.1.b fixed amount discount, the total discount - $60 = - $15/quarter (Fixed Amount Discount Billing Period) * 4 quarters. The charge price of the first month in each quarter completely offsets the discount in that quarter.

Use case 2.2: Start dates of charge and discount are not aligned

The diagram below shows that the start dates of a charge and discount are not aligned.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not.

For the fixed amount discounts 2.2.c and 2.2.d, the fixed amount discount billing period equals the charge billing period.

Table 2.2
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July
2.2.a	10%	Unchecked	N/A	-10	0	-10
2.2.b	10%	Checked	N/A	-9.84	-5	-4.84
2.2.c	$15	Unchecked	Month	-15	0	-15
2.2.d	$15	Checked	Month	-14.76	-7.5	-7.26

For the 2.2.b percentage discount, June discount is - $5=- $100/month * 10% * 15/30*1 month and July discount is - $4.84= - $100/month * 10% * 15/31*1 month. The total discount amount is - $9.84.
For the 2.2.d fixed amount discount, June discount is - $7.5=- $15/month (Fixed Amount Discount Billing Period) * 15/30*1 month and July discount is -$7.26 = - $15/month (Fixed Amount Discount Billing Period) * 15/31*1 month. The total discount amount is - $14.76.

Use case 2.3: Start dates of charge and discount are not aligned, fixed amount discount billing period is smaller than charge billing period

The diagram below shows that the start dates of a charge and discount are not aligned.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not. For the fixed amount discounts 2.3.a and 2.3.b, the fixed amount discount billing period is smaller than the charge billing period.

Table 2.3
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July	August	September	October	November	December	January	February	March	April	May
2.3.a	$15	Unchecked	Month	-15	0	0	0	-15	0	0	0	0	0	0	0	0
2.3.b	$15	Checked	Month	-45	-7.5	-15	-15	-7.5	0	0	0	0	0	0	0	0

For the 2.3.b fixed amount discount, June and September discount is the same - $7.5 = - $15/month (Fixed Amount Discount Billing Period) * 15/30*1 month, and July and August discount is the same - $15 = - $15/month (Fixed Amount Discount Billing Period) * 1 month. The total discount is - $45.

Charge billing period is shorter than discount duration

Use case 3.1: Start dates of charge and discount are not aligned, percentage discount

The diagram below shows that the start dates of a charge and discount are not aligned.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not.

Table 3.1
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July	August	September	October	November	December	January	February	March	April	May
3.1.a	10%	Unchecked	N/A	-10	0	-10	0	0	0	0	0	0	0	0	0	0
3.1.b	10%	Checked	N/A	-15	-5	-10	0	0	0	0	0	0	0	0	0	0

For the 3.1.b percentage discount, June discount is -$5=-$100/month * 10% * 15/30*1 month and July discount is -$10=-$100/month * 10% * 1 month. The total discount is -$15.

Use case 3.2: Start dates of charge and discount are not aligned, fixed amount discount

The diagram below shows that the start dates of a charge and discount are not aligned.

The table below shows the differences when the ApplyToBillingPeriodPartially checkbox is checked or not. For the fixed amount discounts 3.2.a and 3.2.b, the fixed amount discount billing period equals the charge billing period.

Table 3.2
Number	Discount Rate	ApplyToBillingPeriodPartially	Fixed Amount Discount Billing Period	Total Discount Amount	June	July	August	September	October	November	December	January	February	March	April	May
3.2.a	$10	Unchecked	Month	-110	0	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10
3.2.b	$10	Checked	Month	-115	-5	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10	-10

For the 3.2.b fixed amount discount, the total discount is - $10/month (Fixed Amount Discount Billing Period) * 11.5 months.

Applying enhanced discount to one-time charges

For a fixed amount discount charge applied to a one-time charge, to fully apply the discount amount, ensure the fixed amount discount's duration matches the fixed amount discount's billing period.

For example, a one-time charge of $100 starts from 01/14/2023, the fixed amount discount charge is $5 off, and the billing period of the fixed amount discount charge is set to month:

If the discount duration is set from 01/14/2023 to 02/14/2023, the discounted amount of the one-time charge is $95. This is because the discount amount applied on 01/14/2023 is -$5=-$5/month (Fixed Amount Discount Billing Period)*1 month.
If the discount duration is set from 01/14/2023 to 01/15/2023, the discounted amount of the one-time charge is $99.84. This is because the discount amount applied on 01/14/2023 is -$0.16=-$5/month (Fixed Amount Discount Billing Period) * 1/31*1 month.