Why is free shipping important? We know exactly why the customers enjoy it, but let’s discuss why it’s so important to online merchants. If you look around the internet today, you will find a high number of retailers offering free shipping in some kind of sense. This is due to the fact that most online shoppers expect to see it offered as an option. In order to keep up with the competition and not lose out on sales, more and more retailers are looking for ways to incorporate the free shipping deal to their store without breaking the bank.
The benefit to the retailer is to gain more sales by luring customers in with more attractive shipping. In addition to new customers, you are enticing your current customers to return. The cost of shipping isn’t scaring them away and prodding them to search elsewhere for the same product. So, not only are you winning the customers over, the customers are happy to do business with you.
Now what probably comes to mind is the cost of adding a Free Shipping to your checkout. How can you please your customers without taking a huge hit on profit?
You can outweigh these costs with options such as economy shipping, surcharging product cost, membership fees, and restricting who can use the free shipping option. This way you are either making more money in other ways, or reducing the amount you actually losing on shipping. And, while putting these tactics in place you should keep other costs you might want to cover such as marketing and development costs to get the shipping offers visible and promoted.
Incorporate Free Shipping without Breaking the Bank
Free Shipping Threshold
Apply a threshold for free shipping is a great way to limit the option to select orders while prodding customers to buy more. You’re able to set the threshold as high as you like to justify the cost, and promote it throughout the site so customers that find the free shipping option will be enticed to buy more in order to qualify. Many shoppers feel better spending an additional £10 on a product rather than spending £5 for the item to ship.
Restrict Free Shipping by location
Shipping a product to certain locations may cost you more than shipping it to another. So, allowing customers located in that area to choose free shipping could be too costly. But this shouldn’t stop you from offering the option altogether. If this is the case, you should consider restricting the free shipping option to local customers and hiding free shipping from those outside of a certain region.
Another option would be offering Click and Collect. Click and Collect is a way to allow customers to order online and pick it up in the store. It is also a win for the company, because they aren’t charged to ship the item to the customer and can hopefully bring in more business by driving customers to the physical store.
Member based Promotion
The member based shipping promotions are well known thanks to Amazon Prime. You can charge a monthly or annual fee for customers to become a member of your store. Along with sharing exclusive information with these customers, they can enjoy free or discounted shipping in addition to any other promotions you want to offer.
When considering this option, you need to really understand whether it will be worthwhile for the customer, or how you can make it worthwhile. Do a high percentage of your customers buy from you multiple times throughout the year? Could this promotion encourage customers to buy from you more?
If the answer to either of those is yes, then this may be the promotion for you. You will have the opportunity to build loyal customers and reward them with a fast and free shipping.
Add Cost of Shipping to Product Cost
Adding the cost of shipping into the cost of the product is a way to cover some of your shipping costs in a less obvious way. This way customers aren’t required to make any changes to their order to qualify for free shipping and still believe they are not paying for the service to have the item shipped. It is very important to understand whether this option is a fit for your company and the products that you sell.
Look at what your competitors are charging for shipping and how their product costs compare to yours. Keep in mind that even if their product prices are low, they could be chasing customers away with shipping costs. But, this will at least give you an idea of how much you can alter the price of your products.
Another thing to consider when attempting to keep shipping affordable is the accuracy of your rates. It is important that you are shipping items in proper boxes that don’t leave tons of extra space. Products are charged by their billable weight which is the higher value between dimensional weight ((length x height x width)/166) and actual weight. Using a system that calculates dimensional shipping is an efficient way to save money on shipments.
As you are working to build your shipping strategy, you should consider testing these options to see which works better for you and your customers. Using A/B testing is a great way to understand what each option has to offer. Who knows, you may find that incorporating bits and pieces of two or more works best for your needs.
ShipperHQ is a focused and experienced team headquartered in Austin, Texas, USA, with staff in London, UK and in Perth, Western Australia. Since 2008, the company behind ShipperHQ has helped thousands of businesses worldwide configure shipping rates that reflect their business goals. We’ve built an unparalleled base of knowledge, expertise and enterprise grade shipping rate products. Our mission is to give merchants powerful and easy to use shipping tools so they can focus on their core business.