Tips for Making Free Shipping Sustainable for Your Small Business
Ecommerce businesses have comparably little power when working to convince a customer to make a purchase than traditional, brick-and-mortar storefronts. While traditional storefronts can turn on the charm and work directly with customers as they use their basic human senses of sight, touch, hearing, smell and/or taste to select products, ecommerce businesses usually depend on the strength of a visual representation of their product alone. This means that price likely plays one of the most important roles in making digital sales. Google and other browsers’ built-in tools also make it incredibly easy to compare hundreds of similar items at once, making the lowest overall price often the most attractive. Enter, free shipping. Services like Amazon have made free shipping a standard for Prime members, and further, a general expectation from consumers. Free shipping is one the very few incentives available for ecommerce companies and effectively leveraging free shipping can have a tangible impact on your sales. Of course, simply adding the price of shipping onto the base charge of an existing item is not a sustainable option; as explained, comparing similar items online is so simple and impersonal that items with factored in shipping have the very high likelihood of being glazed over by most general web “window” shoppers. Consider, then, this list of tips and strategies to work free shipping into your existing business structure. No matter the size or scope of your existing business, evaluating your ability to offer free shipping is a great starting point for larger money-saving conversations to have with your staff.
Options and Limits
Options: Where feasible, consider giving customers multiple shipping options, the most basic of which ought to be free. For example, if you are shipping through the USPS, all orders which ship as a First-class Parcel may be free while customers can also choose Parcel Select for an upcharge. The most effective buy pages also estimate how many days each option will take to deliver. Having a shipping time estimate is a major factor in convincing a customer to complete an order. But depending on whether or not you are partnering with an ecommerce provider like Shopify with easyship, estimates will likely be pre-calculated.
Limits: Depending on the size and overall cost of an order, consider setting clear parameters where and when free shipping is sustainable for your business and use the info to guide what products or overall orders can qualify for free shipping. For example, a very common limitation for free shipping is only allowing domestic orders under a certain weight or size. Look at your existing products and shipping methods and set a baseline for free shipping. Orders under a certain weight qualify for free shipping where reasonable. Businesses interested in trying limit-based free shipping will likely need to evaluate which shipping services they are already partnered with, which leads into our next idea.
Event-Based Free Shipping
An effective way to get customers excited about free shipping is offering it during a limited time or a seasonal deal. By making free shipping an incentive, you may also drive in new sales. Sit down with your team and find out what types of seasonal promotions make sense for your industry and current scale. A possible concern, however, of running a seasonal or event-based free shipping promo is making less on each sale. Consider, then, cutting some creative corners during these promos. For example: if you traditionally use cardboard for shipping, consider ordering cheaper bubble mailers specifically for those promo orders. There are millions of creative ways to cut down on prices from your end. But the name of the game is making sure customers feel and comprehend that they are taking advantage of a timed-special by making an order during your promo.
Browser extensions that aggregate coupon codes like Honey have exploded in the last 5 years with more than 10,000,000 downloads on Google Chrome alone. Extensions like Honey pause buyers at checkout pages and scan their own systems for any relevant and active coupons. Here’s the trick: businesses can work directly with coupon extensions to create special promo codes. This means that you can create a special free shipping coupon code and distribute that code to a coupon extension along with specific parameters for when that coupon code is allowed to be added to checkout. For example: your coupon code can easily be configured to function only when a customer’s cart has more than $50 worth of merchandise, or whatever figure makes free shipping financially reasonable for such an order. Coupon codes, like seasonal promotions, incentivize customers to follow through on an order because they understand they are getting a deal that either not everyone else is privy to or that they may not be able to use in the future. The purpose of the coupon, however, is to grab customers with last minute cold feet as well as a means to offer free shipping in a less than universal way.
Bundles and Bonus Items
For most businesses, larger orders equal wider margins and more wiggle room for free shipping. By having a customer buy more items and spend more overall on their order, it is much more likely that your business can support offering free shipping as a further incentive. A great way to do this is creating presorted bundles or adding in upselling bonus items for each order. Do the math ahead of time and find out what products at what price point would both equal a deal for your customers and widen your margins enough to allow free shipping. Alongside full bundles, maybe consider adding a small bonus item for a small upcharge. In that upcharge, however, you may have enough space to make free shipping less of a financial hit. For example: if an existing item costing $30 has an upcharge bonus option for an additional $10, perhaps that bonus item will also activate free shipping making it appear as a doubly good deal to customers. Of course, this example will only work if you can both keep shipping dimensions similar with or without your chosen bonus item.
Free Shipping is Never Free
And customers know this too. Trust your customers to understand that the price for shipping must be factored into their order in some way. Depending on your industry and where you ship your merchandise, free shipping in its most traditional form may very well be wholly unsustainable. Through any of these tips, however, it is entirely possible that the SEO and psychological advantages of free shipping are still available for your business.