Why fast, free shipping is important for eCommerce businesses

In the ever-evolving world of online retail, staying ahead means continuously adapting and innovating. As the allure of free, fast shipping continues to shape consumer expectations, businesses must rise to the challenge, ensuring they not only meet but exceed these expectations. It’s not just about making sales; it’s about building lasting relationships in a digital world. And in this world, free, fast shipping is not just a service; it’s a statement.

Offering free, fast shipping is like magic for significantly boosting eCommerce sales. These small perks may seem minor, but they provide enormous advantages that strongly impact customer purchase decisions and brand loyalty over the long term.

The Importance of Fast, Free Shipping

Offering free, fast shipping can be a game changer for eCommerce business owners looking to boost sales and grow their businesses. These small perks may seem minor, but they provide enormous advantages that strongly impact customer purchase decisions and brand loyalty over the long term. Here are some of the reasons that you should prioritize your shipping strategy.

Convenience drives purchases

For the modern shopper, convenience is not just a luxury; it’s an expectation. The digital age has ushered in an era of instant gratification, with services like streaming on-demand videos or getting answers within milliseconds.

This mindset permeates online shopping too. Studies indicate that up to 90% of consumers consider shipping speed to be a key factor in their decision to shop with a particular brand. Therefore, combining swiftness with cost-free delivery becomes an unbeatable formula, ensuring that customers feel their needs are being prioritized above all else.

The psychological power of the word “free”

There’s an undeniable charm to the term “free”. In the customer’s complex, decision-making process, this word stands out, creating a sense of value that few other promotional tactics can match. Even if products have been priced higher to subtly incorporate shipping costs, the consumer feels they’ve struck gold.

This perception is crucial: over 60% of shoppers view shipping costs as a deterrent. That means that offering free shipping can be the difference between an abandoned cart and a successful sale.

Amazon Prime and the redefinition of consumer expectations

Amazon Prime’s meteoric rise is not just about its vast product range. It’s the promise of rapid delivery that has made it a household name. In setting this precedent, Amazon has inadvertently elevated consumer expectations to a level where two-day shipping has become the norm.

For eCommerce businesses, understanding and adapting to this new benchmark is not just advisable; it’s essential. Data has shown that a quarter of online shoppers would abandon a purchase if same-day shipping wasn’t an option, illustrating the huge impact of this shift in expectations.

Transform the buying journey and remove friction

High shipping fees can completely derail customers and cause cart abandonment, much like inefficient website design or overly complicated checkout processes.

Absorbing these costs and offering free shipping effectively removes these obstacles, seamlessly transforming the entire shopping experience. It allows customers to breeze through checkout without shipping fee concerns weighing on their minds. This convenience creates a very favorable view of your brand.

Strategies to Improve Your Shipping Strategy

While it’s clear that offering free, fast shipping can be beneficial to your business, it is not always financially feasible for eCommerce businesses.

Here are some simple solutions to help you find the balance between customer satisfaction and profit margins.

1. Navigate logistics and supplier relationships

One of the first areas to explore is the logistics side of your business. By fostering close ties and negotiations with suppliers and shipping carriers, you might find faster, more cost-effective shipping solutions. Volume discounts, flat-rate shipping, or regional carriers often offer more competitive rates than the big players in the shipping industry.

2. Increase product prices

While this might seem counterintuitive, slightly increasing product prices to cover shipping costs is an effective strategy. The key is to strike a balance. Customers are often willing to pay a slightly higher price for a product if they perceive that they are getting a ‘deal’ with free shipping.

3. Offer free shipping on select items

Not all products in an eCommerce store might be viable for free shipping, especially if they are bulky or require special handling. In such cases, offering free shipping on specific items or categories can still lure customers in, and they might end up buying more than just those select products.

4. Introduce minimum order values for free shipping

By setting a threshold for free shipping, businesses can encourage larger basket sizes, ensuring that the shipping costs are offset by the value of the sale. This not only makes offering free shipping more profitable for your business, but increases your AOV, or average order value, a great strategy for increasing your profits overall.

5. Include shipping cost in the membership or subscription fee

For eCommerce stores that operate on a membership model or have subscription-based services, incorporating the shipping costs into the membership fee can be a viable option. This not only ensures customer loyalty but also regular revenue.

6. Use fast, free shipping as a promotional tool

Instead of offering it all year round, use free shipping as a promotional tool during peak shopping seasons, special sale events, or to clear out old inventory. This creates urgency and can drive sales during those specific periods.

7. Leverage backend efficiency

It’s not just about how much you’re spending on shipping, but also how efficiently your backend operates. Streamlining the packing process, optimizing storage, and reducing handling times can all contribute to lowering costs. When your operations are lean, you’ll find it easier to absorb shipping costs.

8. Partner with brands

If you’re selling products from various brands, negotiate a deal where they partially subsidize the shipping costs. In return, this gives them more visibility and potentially higher sales on your platform.

By deploying a mix of these strategies, eCommerce businesses can successfully introduce free shipping without significantly affecting their bottom line. It’s all about finding the right balance that suits your business model, product range, and target audience.

In Conclusion: Embracing the Future of ECommerce

Shipping policies might seem like just another operational detail, but in the grand tapestry of eCommerce, they play a defining role. Fast, free shipping tells your customers that you value their time and loyalty. While absorbing these costs can affect short-term profitability, the long-term benefits – increased sales, brand loyalty, and reduced cart abandonment rates – make it a strategic investment.

Furthermore, eCommerce businesses don’t have to navigate this challenge alone. Funding solutions like 8fig, designed to optimize cash flow, can help businesses maintain inventory levels and offer shipping incentives that delight customers and drive sales.

In the ever-evolving world of online retail, staying ahead means continuously adapting and innovating. As the allure of free, fast shipping continues to shape consumer expectations, businesses must rise to the challenge, ensuring they not only meet but exceed these expectations. It’s not just about making sales; it’s about building lasting relationships in a digital world. And in this world, free, fast shipping is not just a service; it’s a statement.