Offers, Price Drop, and Closet Clearout: What's the Best Deal for Poshmark Sellers?
When someone likes your item on Poshmark, you can incentivize them to buy by either sending them an offer with at least 10% off or dropping the price on your item by at least 10%. This sends the user a push notification.
So how do you choose one over the other? Shipping costs.
When you send an offer, you're required to offer a shipping discount where you share the total cost of shipping with the buyer. So, for example, if you offer free shipping for an item, the buyer will pay $0 for shipping and you have to pay the full cost of shipping.
But when you drop your prices during a Closet Clearout (CCO) promotion period, Poshmark will offer a shipping discount to the buyer and cover the full cost of the difference. In other words, the buyer still gets a price and shipping discount, but you're no longer on the hook for covering any shipping related costs.
This can add up to significant savings for you if you sell multiple items during Closet Clearout, or have a slim profit margin for certain items.
Lets walk through a scenario using both approaches:
Consider an item that's currently listed for sale at $50 and the current shipping rate / cost of $7.67. This item would cost $57.67 plus tax for a user to purchase.
Earnings on Poshmark Using the Offer Feature
If you send a potential buyer of this item an offer for 10% off with a shipping discount of $4.99, they'll be able to purchase your item for $54.99, and you'll earn $33.32.
The earning amount is based on:
- New Sale Price: $45 total offer price (10% price discount of $50 is$ 5)
- Commission: $9 in commission to Poshmark (20% of $45)
- Shipping Discount: With this offer, the buyer pays $4.99 in shipping, so you pay the difference of $2.68. Remember, since you share the shipping cost, and our shipping rate is $7.67, $7ice-drop-during-closet-clearout.67 - $4.99 = $2.68.
$45 - $9 - $2.68 = $33.32
Earnings on Poshmark Using Price Drop During Closet Clearout
If you drop your price by at least 10% off on Closet Clearout days (usually Fridays and Sundays, though Poshmark has been known to surprise us—check your newsfeed!), the buyer will get a shipping discount between $3.99, $4.99, or even FREE shipping depending on the price of your item and how much you lower it by.
If we lower the price of the item in our previous example by 10%, you'll earn $36—slightly more than you would if you made an offer. Assuming Poshmark offers an equivalent discount of $4.99—their standard CCO shipping discount—here's how those earnings break down:
- New Sale Price:$45. This is the same as the offer example since we're offering a 10% reduction in price, just by lowering the price of the item publicly instead of privately to likers.
- Commission: $9 in commission to Poshmark. This is the same as sending an offer too, because Posh always collects a 20% commission on the sales price of an item.
- Shipping Discount: Buyer pays $4.99 in shipping during Closet Clearout, you pay $0. You are not responsible for any shipping cost because Poshmark subsidizes the difference between $4.99 and $7.67 shipping for buyers during this promotion.
$45 - $9 = $36
What's the Difference?
As with everything in Poshmark, lots of little actions add up, and the numbers are everything. Comparing $36 (using price drop during CCO) and $33.32 (using offers), you'll see a difference in earnings of $2.68. This is a small amount to be gained for one item, but for several, it adds up quickly. Your cost of goods is also key here. Let's say you have a low priced dress you've had sitting around for a while, and you paid $7.99 for it at the thrift store. It's listed for $18 but isn't moving. When a liker comes along, and you offer a generous 30% off and $4.99 shipping to hopefully make the sale, the earnings calculations would look like this: $12.60 (new sales price)-$2.52 (Poshmark's commission)=$10.08. Then take another $2.68 off of that to cover the shipping discount you're offering. Your final earnings are $7.40—putting you in the red.
Especially if you're using automated tools like ProLite, it's just as easy to lower the price of items in bulk as it is to send offers in bulk. Using ClosetWitch's sorting feature, for example, you can target "new" likes just as easily as sending offers to them as they pop up in your newsfeed. This is key because buyers who have just liked your item are interested in it now.
If you only use CCO to hold big sales once every couple of months and choose items to lower at random, your likers for those items may not even remember liking them, let alone still be interested in it. Just as you'd want to let a buyer who walks into your store know that there's a special promotion going on for sweaters as they're looking at the sweaters, use price lowering during Closet Clearout on those items that have fresh likes to see the most completed sales.
The more you sell on CCOs, the more $2.68 per-item earnings paddings you rake in, with Poshmark footing the shipping bill.
Of course there are some drawbacks to using price lowering your main sales strategy. We'll touch on those next.
What if Nobody Buys My Item and I Don't Want My Item Listed at the Lower Price?
You can re-adjust your price to the previous price by updating your listing. This ensures that new prospective buyers see the new price, but there's a catch: if you want to use price drop or send offers again in the future, you'll have to beat your best ever price by 10% for the push notifications to send. That takes into account any price lowerings, even if you've adjusted the price back up. In Poshmark's words,
The notification only sends if the new price is at least 10% lower than the historical lowest listed price.
This policy applies to price drops regardless of whether it's done during a promotion such as Closet Clearout or not. Womp womp.
Lets take our previous example of the $50 item:
- You drop the price of the $50 item by 10% to $45, but no one purchases.
- You then change the price back to $50 by updating the listing price.
- You get a new like. If you drop the price again in the future by 10% from $50 to $45, Poshmark will not send a notification because the items lowest historical price is $45, not $50. (Posh will not notify you of this beforehand if you type in the amount you want to change the price to by hand, but it will automatically adjust to 10% off the lowest ever price if you use their percentage adjusting selection, which is handy.)
- That means that to take advantage of price drop notifications, you need to drop your price by at least 10% from $45. That's $40.5, which is a nearly 20% drop from your original price of $50. Eek.
The long and short of it: you have to make larger price cuts each time you use the price lowering feature to drive sales because Poshmark is tracking your historical prices. Given the savings in shipping from using price drops during Closet Clearout, this limitation is a bummer. But it doesn't have to hold you back.
How Do I Reset the Lowest Historical Price on Poshmark?
You can using the copy listing feature on Poshmark to create a duplicate listing, then delete your previous listing. This will reset the lowest historical price, but you have to remember to a couple of things:
- Make sure your price is updated on the old listing before you copy it over. If you adjust it after publishing, you'll have the same problem with pricing history all over again.
- After you publish the new listing, delete the original listing to avoid having duplicates of the same listing. This doesn't sound like a problem until you accidentally sell the same item twice—whoops!
Is this an ideal solution? No. Copying listings by hand is frankly annoying and error prone. Even worse, copy listing doesn't actually update the "just in" date on your item so even though Poshmark presents the feature as if you're truly creating a brand new listing efficiently, it's effectively just a price history reset tool. You'll likely not see the bump in traffic to your closet or the relisted item that you'd expect when listing something for the first time, which is one of the biggest benefits of going to the trouble of redoing listings in the first place.
Thankfully, we've been able to build a relisting tool for ourselves that automates the relisting process so you can:
- Take advantage of Closet Clearout as much as you want
- Never be at the mercy of your pricing history
- Enjoy "Just In" exposure every time you relist
- Keep listings in your closet fresh
PSST, you can try ProLite for free for 14 days. Just think of how many items in your closet you could relist in that time. And when your trial expires, keep closet sharing for free, forever, as a thanks for giving us a try.
So that's the deal with Closet Clearout vs. sending offers. Do you love a good CCO sale or do you prefer offers? There's no right answer—just lots of ways to get creative and make sales.
Love and magic,
Alan & ClosetWitch Team
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Cathy Vandewater
Cathy Vandewater
Cathy Vandewater