Got this idea via @minethatdata–
If your average order value is $20, then $5 off a $30 purchase is a better strategy than giving $ or % discount on an individual item. Why? Because $5 off $30 encourages one-time shoppers to browse several pages and get to know what you offer as they decide what to buy. (source: http://www.nytimes.com/2010/12/20/business/20ecommerce.html?_r=1)
If your average order value is different adjust $ numbers accordingly.