Can I really boost my business by offering Free Shipping? Is Free Shipping a good tactic to vouch for? – We often come across these types of questions when it comes to shipping costs.
You see a brandstore where everything you get comes at no shipping cost! Would you not get enticed and hoard your cart with products? Well, that’s why free shipping is your best friend. Now, let’s reverse the roles and imagine. You are a small-sized business. You are offering free shipping costs on all the items at all times, resulting in eating away your profit margin. Would you opt for it now? Even after getting more customers, you would not like to compromise on your net profits. So how to keep this balance and when and why to offer free shipping to customers?
“It’s difficult to bicker with the importance of free shipping and how high shipping leads to high cart abandonment rates.”
5 Reasons behind ‘Why should you offer Free Shipping?’
Let’s initiate with the most basic question retailers generally, get stuck to – Should I offer free shipping, if yes, then why? There are obvious reasons to throw shipping into the bargain, but we will give you the 5 most common yet important reasons about “Why should you offer free shipping?”
1. An immediate surge in sales
One of the reasons behind ‘free shipping’ is that it straight away boosts your sales. When you get a product without any shipping cost, you get impulsive and end up purchasing the product. A buyer sometimes yields to pay a higher price than paying an extra shipping fee. Free shipping can also serve as a lead to bigger orders, especially when e-commerce retailers set minimum thresholds.
2. Low rate of shopping cart abandonment
Having a direct association with the shipping fees, the cart abandonment rate is quite a common problem in e-commerce. Imagine this, you want to purchase a product for weeks. You were waiting for the offers, and have just now seen the price is reduced but the shipping fee is added. Would you rather abandon the cart than paying a high price? We already know the answer, don’t we? If not free shipping, try to offer as less shipping fee as you can to overcome this e-commerce obstacle.
|Quick tip: Having integrated with diverse logistics players, ANS Commerce – #1 e-commerce full-stack enabler – ensures timely delivery with optimized costs for both domestic and international deliveries. Request your free DEMO now!
3. Hold out against the competition
In a sea full of online shoppers, you clearly have a lot of – both new and established – competitors. Sometimes, it gets difficult to compete with the already established players due to their widespread reach. But no shipping could be a real savior at those times. When you offer free shipping, but your competitor doesn’t then who do you think will your customers choose?
4. Reaching out to new prospects
Word of mouth plays a significant role when you give a particular offer and others don’t. You not only entice the old customers but also get more leads. ‘No shipping cost’ definitely helps you stand out in the market. People like to spread the word. Give them good offers, they will talk about you. This way they become your brand advocates, letting you be noticeable, and this way you reach out to wider audiences.
5. Retaining social proof on your product page
A good brand reputation is a psychological phenomenon that automatically influences your customer base to choose you over your competitors. When you give products without charging a shipping fee, people get swayed and leave favorable reviews on your product page. This builds a sense of trust among others, letting your brand position in the mind of the consumers.
How & when to offer Free Shipping? 6 Ways you can offer Free Shipping!
There are many uncommon ways to boost your sales. For one reason, most people think that free shipping is the best option to vouch for. But how to keep up the score of sales numbers? Offering ‘Free Shipping’ is one of them that can let you scale your business with more ease. Now that you are agreed to offer free shipping to your customers, let’s explore the tactics you can use to give this perk to your beloved buyers.
1. Set a minimum threshold to avail of free shipping
One of the wise tactics to offer free shipping is setting up a minimum threshold. This works when a retailer sets a minimum amount value of for say, ₹999 to avail the benefits of the free shipping. Think, if you are buying a product that costs around ₹700. Just to save the shipping cost, you will be forced to buy another product to exceed the minimum order value. This way both the buyer and seller get to save more. You will see a sudden boom in sales.
“Not only does it increase the sales but also builds a sense of trust and loyalty among the customers.”
2. Offer free shipping on specific occasions
Remember those times when your news feed is full of “FREE SHIPPING” campaigns! Marketers sort specific occasions for seasonal push when there’s a chance in the upsurge of sales numbers. To be a step ahead of the competition and reach their customers’ satisfaction level, businesses offer free shipping on special occasions. In India, one of those peak times is the festive season. You can provide shoppers with no shipping to get maximum orders. During these times, they are already impulsive to buy products, and no shipping adds an extra boost.
|Quick tip: You can also club the above two ways to increase your profit margins. During specific occasions, set a minimum threshold to get the benefits of no shipping cost.
3. Provide free shipping on certain products
Providing ‘free shipping’ is important to boost sales, but earning a good amount of money is equally significant. How to keep this balance?
Not all the products leave a handsome amount of margin. But there are some that hold good amounts of profits. Offering free shipping on those products would not cause any harm but increase your sales. It’s quite common for retailers to provide free shipping – on high margin getter products – so that they can easily soak in the shipping cost. So why don’t you fascinate the potential buyers by using the marketing tactic? This way you can both gain their trust and boost your sales.
“Deliver happiness to your customers by offering free shipping on their most preferred products.”
4. Persuade prospects to buy membership programs and get free shipping
People love combinations of offers and when they get two things at a time, they hit up without giving a second thought. Take the example of Amazon Prime in which they offer early delivery and free shipping (on some products) to people who are Prime members. An innovative way to earn from both ends is what you would call this model. You can ask your target market to buy subscriptions, premium membership, loyalty programs, or any other subscription-based program. Also, communicate the idea that they will get free shipping on all the orders if they buy your membership.
|Quick tip: You can make different packages of your membership in which you can mention different conditions of shipping. For example, you can have a package of ₹500, giving people free shipping on the order above ₹499. Just like that, you can have another package in which you can have another combo of ₹999 in which they can get free shipping on all the order values.
5. Cover shipping fees with product price
This is a slightly wicked idea to get more traffic on your brandstore. Cook shipping fees in the product price. The desperation to get products without paying any shipping fees can be entertained by this idea. And then you can viral your ‘no shipping cost’ campaign without compromising with your profit margins. Most marketplaces use the same marketing innovation to catch the glimpse of their prospects.
6. Include free shipping on product returns
If you are into the Fashion & Lifestyle segment then this tip works the best for you! Apparels and footwear generally account for high rates of return. Sometimes people don’t find the color flattering enough or sometimes it’s the size issue. Letting customers unpack free shipping offer on the return or exchange would give them another reason to drop by your branstore. They would get encouraged without getting stressed upon the fact the return policy can cost them a delivery fee.
How to do it?
If you are worried about how to manage timely delivery with optimized cost, then we are here to assist. With end-to-end fulfillment and logistics – from the product in warding to delivery, ANS Commerce is specialized to cater to all your e-commerce needs. We manage the warehouse and supply chain across all channels, including multi-category storage support and return management with JIT flexibility. Request your DEMO for the warehousing solution.
What can you expect from ANS Commerce?
- Order processing: We handle the complete ‘pick-patch-dispatch’ process and the manifestation of your B2C orders, including B2B marketplace delivery with integrated logistics
- Return Management: We receive, re-label, and pack products with better QC standards; report cancellations, and returns
- Third-party coordination: We ensure timely delivery with an optimized cost for both domestic and international inventories. Also, we enable marketplace shipment with trusted partners – Delhivery, Bluedart, FedEx, India Post, etc.
Testing various innovations is the cue to find what works the most for you and what doesn’t. There’s no rule that free shipping always works. But you can execute the above-mentioned innovations to see if free shipping works for your business. Additionally, research your competitors, and their marketing tactics to be one step ahead of them.