When it comes to free shipping, I have one rule of thumb: It must be extraordinary circumstances where I will pay for shipping. Of course, like 72% of those that participated in the May 2021 Digital Commerce 360 survey, I too am an Amazon Prime member. And like most online shoppers, I’ve become conditioned to free shipping. Just this week, I had built a customer photobook on Shutterfly where promotions abound. When I saw the $8.99 shipping charge, I had to find a way to remove it. I searched for promo codes, tested a handful and, in the end, reached out to customer service who ultimately provided me with a different code in my cart after I complained about the slew of promotions that seem to change daily.
So, what does belonging to a Prime-like program mean? At one point, Amazon Prime members and most online shoppers just expected orders to be shipped for free. Now, they also have come to believe that they will ship fast as well. When all things are equal on the price front, 58% of Amazon Prime members will buy from the retailer that ships faster. Adding to these changing dynamics, Amazon Prime shoppers have behavior patterns pushing retailers towards both and the findings support those sentiments including:
- 58% expect more products to be delivered within a few days
- 57% expect more products at other online retailers to be shipped for free
- 14% expect online omnichannel retailers to make more products available for same-day delivery
The benefits of belonging will surely grow, and the repercussions are that other competitors will have to follow suit.
Free shipping is the de facto choice among online shoppers, and customers have become savvy to the free shipping patterns of retailers. 68% of online shoppers received free shipping on at least half of their orders. Reviewing the cadence of one’s free shipping against the competitive landscape is always a valuable exercise.
Shoppers will still pay for shipping based on personal circumstances. It is my belief that they mentally do a cost-benefit analysis assessing where free shipping fits into their thinking and personal needs. Product desire and total cost of the order are reasons shoppers still pay for shipping. An overview of the reasons to pay for free shipping point why shoppers still pay;
- 59% wanted the product
- 44% evaluated the total cost of the order
- 36% wanted an item that was only on one site
- 30% didn’t meet the free shipping threshold
- 25% couldn’t find a promo code
- 21%’s product discount exceeded shipping charges
- 19% needed a product faster than the free-shipping timing offered
Free shipping is here to stay and there are many approaches that retailers can take to avoid becoming a casualty. In fact, 73.7% of the Digital Commerce 360 Top 1000 retailers offer free shipping, so the retailers have heeded the shopper’s call. Shoppers will always favor unconditional free shipping but that is rare. The one I see most often is the 44.2% that offer free shipping with a threshold/order minimum. Most of us know the average order for a retailer and can hit that number. Our research found that the median threshold for these retailers is $60. Shoppers will always find a way, so be on board with the free shipping train to avoid disappointment.