Buy 2 Get 1 Free vs 3 for 2: Same Math?

A shopper who sees "buy 2 get 1 free" and a shopper who sees "3 for 2" are looking at the same trade: three units, two paid. On a shelf of identical 25 dollar candles the two banners cost you exactly the same. The moment your three units have different prices, the sameness breaks, because one banner leaves the choice of the free unit open and the other quietly fixes it. This page shows the arithmetic once, then a basket with mixed prices where the cost of the offer moves by 30 dollars depending on which unit is free, and then the wording and setup decisions that follow.

The shared math, derived once

Take any unit price P. Three units at full price cost 3P. Under either banner the shopper pays for two, so the bill is 2P and the discount is P out of 3P: one third, or 33.3 percent. Spread over the three units, each costs 66.7 percent of its price.

Two consequences matter more than the percentage:

• The offer is a quantity trigger, not a price cut. A shopper who takes one unit pays full price. The discount exists only for the third unit, so the offer cannot hurt the margin on single-unit orders.
• The cost grows with price, not with units alone. Because the free unit is a whole unit, a catalog with a 12 dollar item and a 60 dollar item gives away five times as much on the second.

Now put cost into it. Assume a 25 dollar candle with a 10 dollar landed cost, a 60 percent gross margin. One candle earns 15 dollars. Three candles under the offer bring in 50 dollars against 30 dollars of cost: 20 dollars of gross profit, a 40 percent margin on the basket. The offer lowers margin per order by 20 points while raising profit per order from 15 to 20 dollars, provided the shopper would not have bought three at full price anyway. That last condition is the real test, and the break-even discount page shows how much extra volume a given discount needs. If your shoppers already buy in threes, the offer is a pure giveaway.

Mixed prices: which unit is free changes everything

Same-price catalogs are the easy case. Most stores run the offer across a collection with different prices, and then the banner has to say which unit is free. Take this basket, with every input stated:

The same three items produce a 20, 30 or 50 percent discount. Under "3 for 2" with a fixed rule of "pay for the two highest", you are in the first row. Under an open "buy 2 get 1 free" where the shopper picks, the shopper is free to arrange the basket so the most expensive unit is the free one, which is the last row, and your profit falls from 40 to 10 dollars. Shopify's Buy X get Y page describes this choice in one narrow case: when the same product is in both the buy and the get fields, it says the lower-priced item the customer chooses is the item discounted. When the products differ, you decide in how you build the rule, not by hoping.

The practical reading: if your prices within the collection differ by more than a few dollars, either restrict the free unit to the cheapest in the basket, or restrict the offer to products with one price. Do not leave the free unit open and price the offer as if it were the cheapest.

What the FTC guide says about "free" here

The FTC's guide on the word "free" (16 CFR 251.1) names "Buy 1-Get 1 Free", "2-for-1 Sale" and "50% off with purchase of Two" among the representative wording that must be made "with extreme care" so consumers are not misled. "3 for 2" is not on that list, so this page does not claim the guide names it; whether it falls under the same reading is a question for your counsel. What the guide does say applies cleanly to any version of this offer:

• The regular price is the basis. The guide says a purchaser has a right to believe the merchant will not directly and immediately recover the cost of the free merchandise by marking up the price of the item that must be purchased. If you raise the 25 dollar candle to 27 to pay for the offer, "buy 2 get 1 free" is no longer straightforward.
• Conditions go next to the offer. The guide says all terms, conditions and obligations should be set forth clearly and conspicuously at the outset, in close conjunction with the offer, and that an asterisk footnote is not regarded as disclosure at the outset. "Buy 2 get 1 free" needs "cheapest item free" and "limit one per order" in the same line of text.
• Frequency. Paragraph (h) says a single size of a product should not be advertised with a free offer in a trade area for more than six months in any 12-month period, with at least 30 days between offers and no more than three such offers in a 12-month period. The guide speaks of trade areas and does not define one for an online store, so if you run the same free offer all year, ask counsel how it applies.

"3 for 2" is not on the guide's list, but it promises the same trade, so keep the regular price of each unit on record and write the rule out in plain words. This is not legal advice.

Limits for multi-unit offers

An offer built on a quantity trigger needs the limits that a single-unit offer does not.

• Per order. Shopify's Buy X get Y page describes a setting for the maximum number of times the promotion can apply to each order. Set it deliberately. If you leave it open, a cart of nine units may be read as three groups of three. Test with six units and see what your admin does, because the page does not spell out the grouping.
• Per customer. For discount codes the page describes a limit of one use per customer, tracked by email address or phone number. It notes on mobile that the limit applies only to fixed value discounts, so confirm the saved setting on desktop.
• Cart manually. The page says customers must add all items to the cart themselves and that the free item is never added automatically. Say "add 3, pay for 2" in the banner so no one expects an automatic gift.

The same limits for single-copy offers are covered in How to Limit BOGO to One Per Customer, and the two-unit version is compared with half-off in BOGO vs 50% Off the Second Item.

Choosing between the two by catalog

• Every unit in the collection has one price (a candle line, a sock line): either banner costs the same. Pick the one that reads best. "Buy 2 get 1 free" has the word free in front, which also brings the FTC conditions with it. "3 for 2" is shorter and easier to state as a price.
• Prices differ by a few dollars: use "cheapest item free" and say so. The cost is predictable.
• Prices differ by a lot: split the collection into price bands and run one offer per band, or use a quantity discount instead. Volume Discounts on Shopify: Pricing Ladders covers tiers that scale with the units bought, and Buy X Get Y: 12 Structures, With Margin Math lists the other structures if neither fits.

Setting it up as "cheapest item free"

Shopify's Buy X get Y discount lets you set a minimum quantity to buy, a quantity to get at the Free value, and a maximum number of uses per order. Check in your admin which unit it treats as free for your products before you rely on it. To start from a ready rule instead, the Cheapest or most expensive item template in Freebies Engine by Log Studio Lab is described as "Discount the cheapest or the priciest item in the cart." Pick cheapest, set the quantity to three, and cap uses per order. Then place four test orders: three equal units, three mixed units, six units and a cart with two units only. Read the banner out loud against each result.

If the offer will run beside a standing discount code, check how they combine in your admin before launch, since stacking a 33 percent quantity offer on a percentage code can take the basket under your floor. Plan requirements are on the pricing page.