Free Shipping – Is It Worth The Cost?

Free Shipping.  It seems like most sites offer it, so it must work to increase sales, right?  I know that I’ve added additional products to my cart so that I could get free shipping.  And I know of others that have done so, too.

All the big sites offer some form of free shipping, don’t they?  In checking the web, I see the following free shipping promotions:

  • Amazon.com provides free 2-day shipping to students for a year
  • EddieBauer.com is offering free shipping on any order that includes an outerwear purchase
  • WalMart.com offers free shipping if you have the product delivered to one of their stores
  • BackCountry.com ships all orders over $50 for free
  • Sears.com has free shipping for orders over $99

So, free shipping appears to be alive and well, as long as the shopper meets some requirement.  In trying to find some hard data regarding the relationship between free shipping and sales, I found that merchants could see sales increases of about 15% to 20%, which is pretty awesome!  But, of course, that increase comes at the price of swallowing the shipping costs.

The real question then becomes not whether free shipping increases your sales, but does it increase your profitability or get you new customers?  This is where you get the answer “it depends.”

One article that provides some real data on the viability of free shipping was from F. Curtis Barry & Company.  It is clear from their research that you will need to do some testing on your own to ascertain if offering free shipping will increase your profit.  The article points out the following facts:

  • The majority of the free shipping offers were tied to minimum orders.
  • 80% or more of all major businesses offer free shipping in some form during the Fall and Holiday seasons.
  • Raising prices on unique or exclusive merchandise could cover the cost of free shipping.
  • One merchant indicated they saw a better increase in sales by offering a 20% discount instead of free shipping.
  • There is a lot of concern in the industry that free shipping is conditioning the customer to expect never to have to pay for shipping and processing.

The bottom line is that you’ll have to evaluate not only your position in the market, but also that of your competitors.  If they are offering free shipping, you may need to do the same to remain competitive.  If they are not offering free shipping, then it could be a competitive advantage to you to have it as an option.  You will then need to decide which restrictions are necessary to ensure the shopper purchases enough so that your overall profit is increased when offering free shipping.

Next time I’ll cover how to set up Free Shipping using ShopSite.

Holidays are Happy Times for Merchants

Well, I saw Lon Chaney walking with the Queen,
Doing the Werewolves of London.
I saw Lon Chaney, Jr. walking with the Queen,
Doing the Werewolves of London.
I saw a werewolf drinking a pina colada at Trader Vic’s,
And his hair was perfect.
Ahhwooooo… Werewolves of London, Huh! Draw blood!
Ahhwooooo… Werewolves of London.
.

From Werewolves of London – Warren Zevon

Halloween is upon us.  It is the second biggest holiday for retail sales (after Christmas) and this year will see even more spent on the holiday! As a merchant, you have hopefully already promoted any products that have a Halloween tie-in.  Whether those products include scary books, videos, music, decorations, food, cards, or costumes (of course!), they should be taking center stage.

Having a holiday-specific product page or category or daily special on your site is a must.  It allows shoppers to quickly find what they are looking for as well as encounter other items that they may not have considered yet.  This week, both of my daughters were searching our iTunes library (as well as a number of music sites) for Halloween-themed music.  I was surprised to discover that, when I went to Amazon’s MP3 Download site, there was not a link to suggest Halloween- or scary-themed songs.  Maybe everyone already has a copy of Michael Jackson’s Thriller or Warren Zevon’s Werewolves of London but there are other songs that this generation may not know about, like Donovan’s Season of the Witch, are also pretty cool.  Wait, I just realized that his song is now used in the latest Windows Phone 7 commercial, so I guess they’ll recognize it, but not know who originally did it!

Obviously, holiday-specific promotions apply to all holidays, especially to the upcoming Christmas holiday.  But they can also apply to big events.  For example, don’t put all of your Halloween stuff away right after Halloween.  Some of it may be in great demand when the next Harry Potter movie comes out November 19th.  Right now, with the World Series going on, baseball-theme items could also be hot, especially if you have San Francisco Giants or Texas Rangers specific items!

If you can, always tie products to the holidays.  In addition, look beyond the holidays to significant events.  There are many possibilities out there.

Mobile for the Merchant

While actual purchasing of merchandise (especially physical goods) is in its infancy on smartphones, merchants have had no problem using their mobile phones for order notification and store monitoring.  Even before smartphones (with their accompanying apps and mobile browsers), merchants could have their order notifications sent to their cell phone by way of e-mail and SMS messaging.  Likewise, if they had monitoring software checking their site, they could also get e-mail and SMS alerts sent to their cell phones.

Now, with smartphones, there is even more functionality available to the merchant.  Of course, you could view your orders and your site from your phone’s browser, but this is not an optimal experience on such small screens.   Ideally, your shopping cart software will detect that you are on a mobile browser and change the view that it presents to you.

This view optimization was added to ShopSite in v10 sp2 (service pack 2). Below is a typical example of what a merchant might see when they log in to ShopSite from their computer.

start screen

Desktop View of Dashboard

On a mobile browser, this dashboard would provide too much information to display all at once.  The merchant would have to constantly pan left and right and up and down to try to read the screen.  But ShopSite can detect that a mobile browser is being used and display the information like this:

Mobile View of Dashboard Orders

Mobile View of Dashboard Orders

Note the blue PC Site button in the upper-right, which changes the view from mobile to the usual browser view.  Typically, you would not want to switch between views, but it is provided as an option for those who do.  The latest orders are displayed with those that have not been previously viewed by the merchant.  In this example, the second one in the list (having an asterisk beside it, as well as being bolded) shows an order that has not been viewed before.  The orders are links and, in the mobile view, have an extra line between them, so you can clearly select the correct one, even if you have fat fingers like me!

If the merchant scrolls down, they will see the next section of the dashboard.

Mobile View of Dashboard Feeds and Backups

Mobile View of Dashboard Feeds and Backups

This next section shows when the last backups occurred, as well as when the last feed was uploaded to Google Product Search.  The merchant can continue to scroll down through each dashboard section that has been configured to be displayed.

In addition to the dashboard, viewing orders has also been optimized for mobile browsers.  First, here is an example of what a typical order would look like when viewed on a regular computer screen:

Order Screen

Desktop View of an Order

Again, this is too much information to easily display on a regular mobile browser screen, so ShopSite presents the order as follows:

Mobile View of Billing

Mobile View of Billing

The first thing to be displayed when viewing orders on your mobile phone is the billing information.  You can even click the e-mail address and send a message to the shopper from here.

Scrolling down, you’ll then see the Ship To and payment information.

Mobile View of Shipping

Mobile View of Shipping

And, if you continue scrolling down, you get to the product information.

Mobile View of Ordered Product

Mobile View of Ordered Product

Some mobile phones will allow you to view the information in landscape mode instead of portrait mode.  ShopSite will display correctly in both orientations, so you can view it however you are most comfortable.  Using a real-time payment gateway or PayPal express, you could even bill the order from your phone!

So far, ShopSite has only optimized the Dashboard and Order screens for mobile browsers.  You probably wouldn’t want to set up a store from your mobile phone, but if we get feedback that such a feature is wanted, then we’ll make sure to add it in a future release!

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