How to Use Free Shipping to Boost Your Bottom Line
by Gooten Editorial Team on Nov. 12, 2020
For customers, free shipping is more than a nice-to-have. In fact, a November 2018 Statista survey found that 63% of shoppers abandon their digital carts due to a lack of free shipping. While free shipping seems like a cost that you would incur, it doesn’t have to be that way. Here’s how to use free shipping to boost your bottom line.
Free Shipping Isn’t Free
Offering free shipping still means someone has to pay for it, but it doesn’t have to be you. Customers dislike paying for shipping because the shipping cost often appears during checkout as a surprise cost. You can offer free shipping and still put the cost in customers’ hands. Below, we explain how.
How to Offer Free Shipping and Sell More
There are two ways to offer free shipping without incurring the cost.
1. Bake the cost into your items
Simply put, you raise the price of each item by the cost of shipping. This ensures that each purchase negates the cost of shipping, but really only works if you sell unique enough items that a customer couldn’t just go to a competitor and purchase for less.
2. Keep your individual prices the same but upsell your products
Offering free shipping doesn’t have to mean free shipping no matter the purchase. Adding a threshold for free shipping to customer purchases will help ensure you don’t pay for shipping, and even increase the average size of customer carts. To set a shipping threshold, you’ll want to calculate the amount customers can spend to negate any shipping costs. For example, you may find that as long as customers spend $50, you can offer free shipping. Of course, you can always increase the minimum to more than $50 if you want to push customers to spend a little extra. Alternatively, you can push your customers to spend even more by offering product discounts with a minimum spend (i.e. get $10 off when you spend $150 or more), or offer cashback towards a next purchase if a customer hits a certain minimum.
Similar to offering a number for shipping thresholds, you can offer free shipping on bundled or bulk orders, or on specific products. If you don’t feel comfortable offering free shipping all the time, you may want to use flash sales and offer free shipping only as needed to increase business. If you’re feeling extremely confident in your customer base, you may even experiment with offering paid memberships to your website that bake in the cost of shipping, a la Amazon Prime or The Sill.
Either way, you’ll likely end up increasing your order value and be able to offer customers free shipping too.
Don’t Forget to Publicize Your Free Shipping
Offering free shipping is a huge perk for your customers, so don’t be afraid to market it. Be sure to include that you offer free shipping across your website, on your homepage, product pages, and even tell customers how much they have to spend to hit a minimum on the cart page. Consider building a banner that shows up at the top of every page to remind customers that you offer free shipping. Want to drive customers to your site with free shipping? Send an email to your current subscribers with the update. Publish the news on your social channels and add “free shipping” to your cover images. If you’re investing in paid ads, consider testing “free shipping” messaging to drive more visitors.
Curious if Free Shipping Will Increase Your Order Value?
Run a temporary free shipping offer using the above recommendations and see what happens. Chances are, free shipping does more for your business than you expected!