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The Importance Of Free Shipping

Posted by Michael Bloch in ecommerce (Tuesday April 10, 2012 )

Xmas is long gone, as is Valentines Day and more recently Easter. Things a little quiet? Consider free shipping – it may be a lot more important in turning browsers to buyers than you think and it doesn’t have to send you bankrupt.

Back in December 2011, comScore ran a holiday shopping survey; the results of which revealed some very interesting statistics in relation to free shipping.

The most notable was a full 36% of those surveyed would not make a purchase without free shipping.

Another 42% actively seek out free shipping offers – so we’re looking at 78% of people considering free shipping to be important in a purchase decision. Only 2% of the thousand people surveyed said free shipping was very unimportant.

It’s little wonder – a major cause of shopping cart abandonment is sticker shock when freight is dumped on at the checkout as it can be a considerable unexpected additional expense, particular on cheaper items.

comScore pointed out that although free shipping is an additional expense to the merchants, it tends to generate higher average order values.

So let’s say you’re on wafer thin margins as is – how do you implement it? As I’ve mentioned previously, it can be simple – restructure your pricing. Add on the cost of shipping or part of it to your product prices, but trumpet the fact that shipping is included in the price. That aspect needs to be really, really clear; otherwise you’ll just appear too expensive.

It may seem like a silly way to approach it, but consumer perceptions can be a funny thing.

Another way is to offer free shipping over a certain purchase price – you can get back some of your profit that way too as your customers will be encouraged to spend more.

Stephen Bulger from eFulfillment Service has published an article on Web Marketing Today examining how you can incorporate free shipping (and whether you should or can) in greater detail.


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