Free shipping encourages most shoppers to buy more online

Monday, 25 January 2010

The bottom line is that consumers expect free shipping, and e-commerce sites that can provide it are often more successful than those who do not. One of the biggest reasons why people like shopping online is so that they can get a great deal in a convenient way. If a consumer is on an e-commerce site which charges shipping, they may try to find the item elsewhere or just buy in the store if they can get it for the same price.

Compete.com released results from a recent Online Shopper Survey citing that free shipping would encourage 93% of respondents to purchase more online. This is a staggering number that is hard to ignore if you own or operate an e-commerce store, which cannot give free shipping on items. There are forums and sites dedicated to consumers who hunt out free shipping, and many times these also offer tax free options.

Having free shipping is not always a possibility and there are only a couple dozen popular e-commerce sites that execute the free shipping model well. However those who did were big winners over the 2009 holiday shopping season as consumers rushed online to try and save as much money as possible. Executing a free shipping model well is very difficult and takes a significant amount of time and financial investment, especially if you sell electronics which already have a low profit margin. Some e-commerce sites use techniques to get around free shipping and charge a flat rate on all orders, so that overtime they can average the shipping cost to stay profitable. A good example of this is Overstock.com, which charges $2.99 shipping on every order. If you cannot offer free shipping across the board, then you should look to experiment with marketing free shipping promotions, or offer it on select items. Customer satisfaction always seems to hurt when shipping cost needs to be paid, regardless of how much value you seem to offer the consumers. Now is a great time to start experimenting with free shipping so you can have a proven plan for your ecommerce storefront in the 2010 holiday season.