By Lauren Carter
Why You Should Consider Offering Free Shipping
Amazon encourages third party sellers to offer free shipping, for many merchant sellers this is a big consideration. You need to think about the impact on your margins and customer expectations. Anyone who has shopped online will know that free shipping is a very attractive offer, many of us resent having to pay “extra” to have something delivered even though when we really think about it we know the price isn’t unreasonable.
Amazon argues that offering free shipping will increase your sales and help you win the Buy Box more frequently. They also claim that “Amazon is investing in features to raise customer awareness of offers with free shipping.” This could mean your offerings will become more visible to customers and that can only be a good thing.
Research into online shopping behaviours has shown over and over again that shipping costs are one of the biggest barriers to completing purchases. If your customers are on the fence decided whether or not to make a purchase, the offer of free shipping might be enough to encourage them to take the plunge. If you aren’t offering that, there’s every chance they will go elsewhere to find a merchant who does offer free shipping.
If you do decide to offer free shipping you need to take the time to work out where you can afford to do this and where the cost of shipping will eat into your profit too heavily. If you sell low cost items, free shipping probably won’t work for you, you might want to think about setting free shipping for products over a certain price or for customers who purchase multiple items.
If you sell large or heavy products where shipping is particularly expensive you might not be able to offer free shipping unless you raise your price to cover the shipping. Alternatively you might offer reduced shipping and cover some of the cost yourself.
Offering free shipping certainly has great advantages and seems like a great proposition but there are a lot of considerations to make. If you plan carefully you can bring in more customers without haven’t to sacrifice too much of your profit.
You can set up free shipping using the Amazon Promotions tools in Seller Central. You can do this for a limited period to see what difference it makes to your business. Remember to keep testing new strategies and trial changes before making them a permanent part of your business plan.
If you would like to know more about offering free shipping check out our friends at ParcelHub.
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