What's the impact of discounts on my overall profit margins?

As an e-commerce business owner, I'm struggling to understand how discounts truly affect my bottom line. While promotions seem like a great way to attract customers, I'm worried they might be eroding my profitability. I need a comprehensive analysis that breaks down the potential positive and negative impacts of discounting strategies, helps me calculate real profit implications, and provides guidance on maintaining healthy margins while still driving sales and customer acquisition.