Click me

Can You Make Free Shipping Work for Online Store?

FREE SHIPPING NICE TO HAVE OR ESSENTIAL FOR PURCHASE? One of the biggest challenges Internet retailers have faced since day one is resistance to shipping fees. To make shopping on the web more like shopping in person, some merchants began offering free shipping with online orders. Does free shipping really motivate website visitors to buy more? Let's find out: NEARLY HALF OF ALL ONLINE ORDERS NOW INCLUDE FREE SHIPPING Online retail spending hit up from Nearly half (47 percent) of $33.8 BILLION those orders included free $38 BILLION 47% shipping for Q1 2011, last year, according to a May 2011 comScore report. of consumers are at least abandoned online shopping carts "somewhat likely" to cancel 61% 52% are triggered by shipping and handling costs, according to a 2004 study from the Wharton School of Business. their purchase if free shipping is not offered. SHOPPERS SPEND MORE WHEN SHIPPING COSTS ARE WAIVED The Wharton report also indicated that shoppers 30% spend, on average, 30 percent more per order when free shipping is included at checkout. AOV FOR FREE SHIPPING ORDERS: AOV FOR PAID SHIPPING ORDERS: $125.20 $86.58 This was especially prevalent during the 2010 hollday season. Here's how average order values (AOVM broke down for the week ending December 5, 2010: WILL FREE SHIPPING INCREASE YOUR SALES AND PROFITS? Multichannel Merchant quotes executives who say: Yet Wharton Professor David Bell contends: "Offering discounts of 20 percent to 25 percent off merchandise provides the same lift as free shipping." "A free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10." This could be because customers mentally associate "shipping" with the added cost of shopping online. But don't assume elther view is correct: Test it! All of these variables decide whether free shipping will help or hurt YOUR business. AVERAGE ORDER VALUE PROFIT MARGINS REPEAT VS. ONE-TIME BUYERS COMPETITION While free shipping was once a "point of difference" benefit (something that could separate you from other retailers) it has increasingly become a "price of entry" benefit, without which many customers will never buy from you. SOURCES: TECHCRUNCH I WHARTON SCHOOL OF BUSINESS I COMSCORE I monetate MULTICHANNEL MERCHANT

Can You Make Free Shipping Work for Online Store?

shared by rmmojado on Jan 31
For savvy online shoppers, finding “free shipping” is like discovering buried treasure. But can shipping really be free? Someone has to pay that shipping charge, and if you’re experimenting with...




Unknown. Add a source


Social Media
Did you work on this visual? Claim credit!

Get a Quote

Embed Code

For hosted site:

Click the code to copy


Click the code to copy
Customize size