Should You Offer Free Shipping from Your Online Store?

shipping
An increasing number of online retailers are offering their customers free shipping. Online shoppers who benefit from free shipping do not pay an extra shipping charge and typically receive their goods within five to seven business days. On some websites, customers have to spend a certain amount before qualifying for free shipping.

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If you own an online store, you may be wondering if you should offer free shipping as a way of increasing sales and attracting new customers. A number of surveys have asked US consumers about their requirements and expectations in this area. The results of these surveys should help you to set up free shipping options that will meet the needs of your current and potential customers.

Free Shipping is Popular Among Online Shoppers

The Holiday Shipping Survey 2014 commissioned by Pitney Bowes, a postage meters company, found that free shipping was more important than fast shipping for 82 percent of approximately 1,000 respondents.

The 2014 Home Delivery Survey conducted by AlixPartners, a business advisory company, discovered that free shipping has a strong influence on the online purchasing decisions of 69 percent of 1,016 respondents.

In addition, the UPS Pulse of the Online Shopper Study, carried out by the courier company, UPS, in association with comScore, a digital analytics company, revealed that 58 percent of over 5,800 respondents had bought extra items in order to meet the requirements for free shipping.

The Importance of Free Shipping Varies by Age Group

Although more than half of all online shoppers are attracted by offers of free shipping, it is more important to people in some age groups than in others.

Free shipping was especially important for consumers aged between 35 and 44, according to the research published by AlixPartners. Some 78 percent of people in this age group stated that free shipping was a very important factor in their purchasing decisions. Therefore, if you sell mainly to parents or other consumers aged between 35 and 44, offering free shipping could boost your sales.

Free shipping was least important for people in the youngest age group of 18 to 24 years, although 63 percent of respondents in this age group did say that it had a large influence on their purchasing decisions.

Older Buyers Are Willing to Wait Longer

Overall, the UPS survey discovered that 83 percent of respondents were prepared to wait two more days for the delivery of an order with free shipping than for an order that included an extra shipping charge.

The 2014 Home Delivery Survey found that older online buyers of items with free delivery were willing to wait longer to receive their orders than younger consumers.

Over half (54 percent) of buyers aged over 65 were prepared to wait a week to receive goods with free shipping, compared with only 22 percent of those aged between 18 and 24.

By contrast, 15 percent of people in the two youngest age groups (18-24 and 25-34) expected to receive orders with free shipping within two days of ordering, compared with only 5 per cent of those aged 55-64 and 4 percent of consumers aged over 65.

Therefore, if your customer base is composed primarily of people in the youngest age groups, offering free shipping with delivery in two to four days could attract more customers. On the other hand, if your customers are mainly older people, offering free shipping with delivery within one week should not deter the majority of potential customers.

The results of these surveys suggest that it is beneficial for online retailers to offer free shipping. It is particularly attractive to consumers aged 35-44 and more than half of all consumers may even be willing to spend more money to ensure that they qualify for free shipping.

Modify your shipping options in the light of the results of these surveys. If you decide to offer free shipping on orders over a certain amount, see if this leads to an increase in the average amount of each order. If you decide to offer free shipping on all orders, see if it increases your total sales. The results of these surveys suggest that offering free shipping is a good way of boosting sales.

this article is written By Roz Andrews