- Finance 101

5 Benefits of Offering Free Shipping

Free shipping has now turned into a cutthroat necessity for many online retailers and marketers. No doubt there are certain costs related to free shipping however there are much stronger reasons to feel good about it. When renowned online shopping websites like Amazon first introduced free shipping may be a couple or more years ago, it might not have made any right sense for all such ecommerce merchants, particularly those with the small businesses. But with the drastically increasing scale and growing customer expectations, free shipping has become common, mandatory and even beneficial to most of the online retailers. Let us find out how.

5 Benefits of Offering Free Shipping

  • Free shipping increases sales– Free shipping has become tremendously popular with every retailer who deals with his clients online. The reason is that the marketing company that provides free shipping facility becomes famous all over an area and then all over the town and after that it becomes obvious that the sales grow a lot due to the increased branding and popularity. Well but there is an important note attached to it which claims- “Some shoppers may charge for faster shipping when the situation demands for, perhaps a last minute gift or so. But otherwise delivery times being equal, any customer would rather prefer not to pay while an order is being shipped. Therefore keeping this particular thing in mind, the facility named ‘Free shipping’ is introduced.
  • Free shipping boosts average order value-A portion of the promised, free-shipping-induced boost in ecommerce revenue will come in the form of increased average order value. When free shipping offers a minimum threshold like- £ 25, £ 50 or £ 70, some shoppers will certainly add more items to their carts. In fact a June 2015 study from comScore and UPS have reported that 52% of shoppers have added items to their ecommerce shopping cart to qualify for free shipping.
  • Free shipping costs can be controlled– Online retailers those who sell commonly available products or any other commodities often compete on the pricing, they try their best in diminishing the margin and there triggers the race that who would reach the bottom first. Usually there is no way out of it, one cannot help if his/her competitor is irrationally decreasing the price. However free shipping can control the costs to some extent. In fact confident online retailers can take actions that can significantly reduce shipping costs. Given this level of control, managing shipping expenses may even be a way to regain margin.
  • Loyal customers love free shipping– Although it is not yet 100% certain that free shipping offers help in retaining customers, still there are many such marketers who religiously believe that there is a strong bond, a strong relationship between the company and the customers. They believe that most of the customers shopping from their websites are loyal and good. Therefore as a return gift they offer them free shipping and the customers in return give them a good feedback and helps them adding up more new customers.
  • Free shipping helps in enhancing retailer-client trust– As human beings we want our money to be spent the right way and even if a little of it is wasted then it really affects us. Free shipping is the best way to assure the customers who are mostly budget-oriented that their money has been invested in the right place and not even a single penny is wasted in these criteria.

Author Bio: Mark Collins writes of the behalf of Syncline, a company which provides multichannel ecommerce solutions.

About eCommerce FAQs

Read All Posts By eCommerce FAQs

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.