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Free May Be Worth It

October 1, 2008 According to Luke and Maisie Knowles, founders of www.freeshipping.org, free shipping remains a powerful motivator in the online marketplace.

They cite plenty of numbers to prove it:

• 61 percent of online shoppers prefer to shop with a retailer that offers free shipping than one that doesn't. — Forrester Research (2007)

• 43 percent of shoppers abandon their shopping carts because of unexpectedly high shipping charges. — PayPal, comScore (2008)

• 60 percent of respondents to one survey said free shipping is a reason they are more likely to shop online. — Harris Interactive (2008)

• 90 percent of respondents said free shipping offers would entice them to spend more online. — The Conference Board (2008)

Free shipping can eat up a retailer’s profit margin, especially on a commodity where building the cost into the product’s price will cause comparison shoppers to go elsewhere. But there are some varieties of free shipping that can reduce the bite, or make it worthwhile. 

Free in-store pickup is a perk often offered by big multi-store chains, but for a single clicks-and-mortar shop with all inventory on site, it is even easier. Free shipping with a minimum purchase amount (higher than your average sale) and flat rate shipping both encourage customers to up their ticket, while selling membership in a club such as Amazon.com’s Prime can make money up front and encourage repeat customers.

Posted by Virtual Merchant Today on October 1, 2008 | Comments (1)