Why free shipping should always be part of your eCommerce strategy

Why Free Shipping Should Always Be Part of Your eCommerce Strategy

It’s hard to imagine a marketplace today that doesn’t offer free shipping. Free shipping is perhaps one of the most important sales incentives. It not only streamlines the purchase experience but also prevents cart abandonment which often occurs when buyers see shipping charges added to the retail price they were previously willing to pay. While sometimes the difference between making a sale or losing to a competitor may depend upon reviews or even a few dollars price difference, more often than not, it comes down to shipping costs. Sellers seeking to distinguish themselves from the competition should strongly consider offering shipping for free.

Free shipping strategies

There are a number of ways that sellers can provide customers with the advantages of free shipping. They can offer free shipping via a discount code, a coupon, a fulfillment method, or as a special site-wide or product-specific promotion to generate an uptick in sales. They can even build it into the price of the price of the product as we’ll explore next.

Include shipping fees in your product prices

There’s no such thing as a free lunch, right? So is there really such a thing as free shipping? Maybe not. A technique many sellers use is to include shipping costs in the price of products, thus giving the illusion of offering free shipping. At the end of the day, buyers are always looking for the best deal and free shipping often gives them the extra push to complete a transaction on the spot. So adding free shipping to your seller arsenal can be the extra incentive needed to generate more sales.

So as a seller, how can you make sure that you can include shipping costs in your prices and still be competitive? It’s best to be aware of this when you’re still in the product research phase. Using a product research tool like Algopix provides you with actionable data insights into everything from product performance to shipping costs to tax estimates. Using this valuable information, you can avoid sourcing products that will be too expensive for the market if you include shipping costs in your overall product price. This is a fast and practical way to identify lucrative products that will generate revenue for your online business.

Be competitive

Today it’s getting to be the norm for sellers to offer free shipping on products. It can even win you buyers and help you stay ahead of competitors that have priced their products slightly lower than yours but choose not to offer free shipping. Because free shipping is so common across marketplaces and on retail sites, merchants that don’t offer free shipping may stand out in a negative manner, with consumers immediately eliminating their shops from their buying considerations.

Create a better customer experience

Free shipping can actually improve the customer experience by creating the opportunity for your customer to feel like they have gotten a deal or that they have saved money in some way. If your product was sent with free shipping and it arrives in a timely manner, customers are much more likely to leave a positive review. If buyers paid for shipping your product, the shipping fees were high, and/or it takes a long time to arrive, it can cause the buyers to feel annoyed, propelling them to leave negative reviews for your business. Keep it simple and avoid buyer frustration by offering fast and free shipping along with excellent customer service and great communication.

Have your fulfillment methods down to a science

Of course, different products require different shipping methods and pricing. The method you use for fulfilling your products will ultimately affect your free shipping strategy. Products that are fulfilled using Fulfillment by Amazon (FBA) are eligible for Amazon Prime which includes free two-day shipping. This may be just the option you need to get your products delivered quickly and with free shipping, without all the headache. By using an Amazon fees calculator you can quickly calculate your fulfillment costs. An Amazon FBA calculator offers essential insights into shipping costs and taxes, and this valuable data can significantly decrease risk and optimize sales.

However, you may find using Amazon’s Fulfillment by Merchant (FBM) to be a better option. FBM may be a better fit for smaller businesses and sellers with exclusive products. Sellers should employ the service of an Amazon fee calculator to understand best which products will work best for their specific needs. Using proprietary algorithms to analyze the data, the Algopix engine produces valuable insights for each market, including a “recommended” or “not recommended” indicator for sellers looking to make quick sourcing decisions.

A multitude of reasons exists as to why it’s to a seller’s advantage to offer free shipping. Sellers can gain the upper hand using product research tools and fee calculators to know which products will prove most lucrative when looked at holistically. It’s critically important to do your research and understand your margins (with free shipping) before you source! Get a handle on demand and costs by trying Algopix’s free 7-day trial today!