With the continued rise of e-commerce on a global scale, the issue of Free Shipping has certainly become at the forefront of our minds. At BIG Corp, many of our brands 1) ship globally and 2) have a high value ticket price and therefore free shipping feels like a “must have” in order to satisfy our consumers. This article, however, explains that 100% free shipping, 100% of the time may not be necessary if communicated in a strategic and clear manner. It goes on to explain some simple alternatives that we found extremely usual to trial on some of our brand websites. Check out the article here.
- We must acknowledge that Free Shipping is a powerful incentive to purchase online: “According to Marketing Land, 9 out of 10 customers were incentivised to shop online when offered free shipping.” As a consequence, over 60% of ecommerce businesses claim that free shipping is one of their most important marketing tools. But is this assumption necessarily accurate?
- Lisa Suttora, an eCommerce consultant, brings up a good point that in the past, free shipping was designed to be used as a promotion, NOT a standard pricing model. It is worth to consider that offering alternative incentives that do not impact profit margin so greatly could be a more sustainable model: such as a CRM program to drive loyalty and repeat purchases.
- An effective way to dial back the ‘always on’ free shipping mechanic is using a tiered, calculated rates approach. For example, having a free option (and openly communicating it might take a little longer than ideal!), but then offering for charge options (i.e. Express) based on the height X width X weights of the item.
- Or, offering free shipping with a minimum order to offset the profit hit for covering the fulfilment. The article recommends setting this minimum at 10-15% higher than your average purchase value.
Image Credit: www.easyship.com