Free shipping is no doubt one of the marketing tools that is utilised by many online businesses at present. And it undeniably works for most business models. Many statistics and research have shown positive results of implying free shipping to the business.
However having that said, different types of free shipping methods may work differently for different types of products or businesses you are in.
So one key to find out is to test them out! Check out the number of ways to implement free shipping.
1 | Set Minimum Purchase Threshold
Setting a minimum amount of purchase to enjoy free shipping is one of the common ways businesses use. The reason why this option is the top pick because it allows sellers to ensure that the profit margin is attained, at the same time encouraging buyers to purchase more in value or quantity. Based on the UPS Survey, it has shown that 48% of the buyers add items to cart in order to enjoy free shipping.
But how low should the minimum threshold be? There is no definite formula for this however, it can be tested through trial and error. Try starting with $50 then maybe plus minus $20. Try out for one week to see how the response goes or which has a higher conversion rate.
2 | Limited to Specific Types of Product
The objective of this method to sell a particular hot-selling item in your shop. Or when it is permissible to certain items with low shipping cost due to its lighter weight or smaller size, for example, jewellery, small accessories and so on.
However, for this method, you'll have to ensure that the free shipping for that particular product is enticing enough to the customers. For instance, you may want to increase your sales for socks, but it may not generate that much sales as socks are not the main items your majority customers buy. Socks may be an up-selling item to go together with as customer purchase sneakers or shoes. Then, free shipping inserted here may work.
Yeah, so you can play around with marketing tactics to see how this method works best for you.
3 | Seasonal Free Shipping
Instead of offering free shipping all year round, you can also have free shipping for a seasonal period like Valentine's Day, Christmas, New Year and Black Friday. This is effective especially when the buyer is in the buy mode. Plus, more and more buyers purchase online during the festive seasons.
Just like how Target did last year, offering free shipping from November 1 to December 23 with no minimum purchase required.
While for Gold Canyon here, offers free shipping during the holiday season with a minimum purchase value.
4 | Free Returns Shipping
If you find that offering free shipping is not doable or a profitable choice, you may consider providing free shipping on returns. Especially for items that have higher chances of returns like clothing and shoes, free shipping on returns would be a plus point for you.
According to a study, free product returns have major impact on future sales. Invesp infographic depicted that 67% of shoppers checked the returns page before making a purchase and 79% of consumers would want free returns shipping.
For example, a customer buys a top for $10 and the size does not fit. If the return shipping cost $10, this would mean that the customer paid a total of $20 without getting anything. With this first experience, it might cause customer to hesitate for their next purchase, worrying that the return cost would incur and suffer greater loss.
So, free return shipping may be your option to go for.
5 | Through Loyalty Programmes
Make free shipping eligible only for members. This would encourage customers to participate in your loyalty programmes and in return help to build up your mailing list.
Wrapping Up
There many ways to implement free shipping for your businesses. But instead of merely following what the giant online businesses do, make sure do calculate beforehand to ensure the profit margin attained is doable. Think from your customers point of view and provide them with the most value.
Posted by Shu Wen
Friday 9 Mar 2018
