For obvious reasons, consumers are naturally drawn to any way in which they can save some of their hard-earned cash. So it stands to reason that free shipping has become such a popular feature to promote eCommerce sites. In addition to the built-in appeal of giving customers the chance to cut down their purchase total, such a tactic has a tremendous impact on customer service and, in many instances, may directly lead to the formation of long-term customer relationships. However, like any marketing tool, free shipping delivers the best results when used strategically to accent your business.
Why Free Shipping Is Essential
“Free shipping” may once have seemed like a concept completely at odds with the profit-seeking mission of online businesses. After all, shipping costs are, in some cases, one of the most reliable (and justifiably profitable) elements of their pricing structure. However, the advent of eCommerce has completely changed this attitude. With mounting competition from countless sites, free shipping is now standard practice among eCommerce companies wrangling to win customers and keep them coming back for more. Though some companies use free shipping as more of an incentive than a built-in feature of their site, it is widely considered one of the most surefire ways to attract consumers.
In fact, one study found that 96 percent of shoppers are more likely to purchase from a particular eCommerce site if free shipping is offered. In fact, it’s often among the deciding factors in a purchase decision, even taking priority over delivery speed. 83 percent of U.S. shoppers,research shows, are even willing to wait an additional two days for delivery if the shipping costs are waived, and more than half (58 percent, to be exact) even added more items to qualify for free shipping. We’ll get into specific strategies involved in free shipping shortly, but the proven benefits and sheer ubiquity of this feature makes it an easy addition to your site.
When You Should Offer Free Shipping
Considering just how powerful a feature free shipping can be, you may aim to incorporate this particular tool into your business model on an indefinite basis (in conjunction with certain purchase thresholds and conversion baselines to protect your business, of course). However, even if this is not a feasible goal for your business right now, there are a few scenarios which are particularly suited to free shipping offers. Let’s take a look at some of the most common.
- During holiday campaigns: Holiday seasons are known for being particularly costly times of year, what with all the gift-giving going on. So customers are almost certain to be on the lookout for ways to trim costs along the way. Consider touting free shipping in your next seasonal campaign to beat out your competition.
- Right before checkout: We’ve all seen those conveniently placed items near the register of our favorite store: a last-ditch effort to boost sales via impulse purchase items. Your site should employ the same device by promoting free shipping just before customers check out. If you set a specific purchase threshold, there’s every chance that customers will toss another item or two in their cart before they’re done.
- When you have a nearby warehouse: When you have a warehouse nearby, it’s much easier to confidently enhance your shipping offer to customers. Since the cost to ship will be lower, you might want to include a lower minimum purchase for these individuals to qualify for free shipping. Such a move will only boost customer loyalty and conversion.
- For items that are smaller in size: This is another situation that naturally lends itself to free shipping. Because of the decreased weight of the given items, the potential profit from shipping costs is already far less significant. So why not waive this aspect to boost sales and develop a positive rapport with customers?
A Calculated Risk
While the concept of waiving the profits that would accompany shipping may seem like a risky proposition, the fact is that the potential benefits such a strategy can have on your business are certainly worth it. Moreover, free shipping has become so widely embraced as an industry standard throughout the eCommerce world that you’re actually doing your business a disservice by not offering this key ingredient to your customers. So many strategic options are available to maximize the profitability that free shipping can bring that there truly are no longer any viable excuses why you shouldn’t integrate it into your site.
For more marketing ideas as well as invaluable insights into how you can employ different strategies into boosting your online sales, check out our eBook, “A Comprehensive Guide to Competitive Online Retail Pricing Strategies.”