From getting a potential customer on your website, to delivering a package on the doormat, sending plays an important role in the way your brand is experienced by the customer. Various studies have shown that free shipping is the number one priority of online shoppers. Of course we all know that sending is never free but why do so many companies offer free shipping? And how can you use it to generate more sales?
The power of the word 'Free'
To understand the benefits of free shipping, you must first understand what it does to our brain. People shop online because it takes away all the inconveniences of traditional shopping. Until we are going to checkout and see that, in addition to our order of $28, we have to pay a further $5.99 shipping charges. For consumers, shipping costs as something they would not have to pay for. This is because people are not used to this at all. Even though it is incorporated in every product we buy, from bananas in the supermarket to a new bicycle at the specialist store. We only feel the "pain" of shipping costs when these costs are actually specified.
Unconscious emotional reaction
The power of the word free is so great that people often rate the value of a free product too high, even when compared to a better product that costs a small price. The word 'Free' grabs our attention and ensures that we do not have to think about how much something might be worth.
"Free shipping often finds people more attractive than $10 discount".
Amazon
In the book "Free" Chris Anderson writes about a case of web giant Amazon. The power of "free" is so strong. When Amazon introduced free shipping in Europe, the number of sales increased drastically. Except in France, where the shipping costs were reduced to 20 cents. You would say that 20 cents is basically the same as free, but the simple lack of the word "Free" had a big effect on the number of sales. It was only when this was changed that sales in France also increased.
"People automatically tend to the word free, regardless of value".
Is free shipping something for your online stores?
We now know what the power of free shipping can be, but that does not mean that shipping costs money. For many online stores, this is one of the biggest cost items and feels like offering free shipping as the taking away of our own margin. Yet there is a big chance that not offering free shipping will cost you more than it saves you.
Do you sell products that are also offered in online stores?
Once people discover that shipping costs have to be paid, they often leave the shopping basket. After all, they will first check whether the product will be sent to home free of charge.
Do you have unique products in your store?
Then think about making your products slightly more expensive so that you can still offer people free shipping. This increases the chance of repeat purchases and ensures that people attach even more value to your products.
Do you have a online store with many cheap products?
If the average order amount is low, offering free shipping is of course very difficult. But counting the full shipping costs is also not an option. When the shipping costs exceed 10% of the purchase price, there is more chance that the customer will leave the check-out. For international shipments this can be up to 30%."
How free shipping with conditions ensures more sales
Fortunately, there is also a happy medium that can even ensure that people spend more money in your online shop. Apply the strategy properly. We are talking about a free shipment with conditions. Free shipping from a certain amount ensures that you do not snatch a margin on small orders and prevent your best customers from shopping elsewhere. An article on Digital Global JV shows that online shops with label "Free Shipping with Conditions" got the most successful marketing tool.
Conclusion
Offering free shipping is a must for almost every online store. With the right strategy it provides more revenue, without it costing too much. In order to make your free shipping strategy cost-effective, it is important to keep the costs of sending parcels low.
Misty Jhones