CALCURATES BLOG

3 Ways Your E-commerce Can Benefit
From Free Shipping

free shipping for small business
Nikolay Pasholok
Product Owner, Calcurates
Among a whole variety of delivery options, free shipping is probably the most alluring. It's no wonder that 93% of consumers are encouraged to buy more products if free shipping is available, and 58% add more items to their cart to qualify for free shipping. When executed carefully, it mitigates the cart abandonment rate and boosts the average order value.

Can Your Business Afford Free Shipping?

There's no such thing as free shipping — somebody has to pay. It just shouldn't be you. The shipping costs depend on a multitude of factors: rates, dimensions, volume, destination, etc. The golden rule is: Under no circumstances should you apply free shipping to inexpensive items purchased alone. If a product costs $4, and the shipping fee is $6, your delivery expenses are absorbing your profit. Hence, for an online store that primarily sells low-cost items, free shipping is a no-go.
If you frequently ship orders abroad, free shipping also won't make any sense.

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What Are the Top 3 Free Shipping Tactics?

1. Bake Shipping Costs into the Product Price

Pick between these two offerings:

1) $30 product + $5 shipping
2) $35 product + free shipping?

No customer wants to be surprised by the high shipping costs at the checkout. This is exactly the reason behind the high cart abandonment rate.
Product price included in the shipping cost
Although including shipping costs into the price of the product is generally a smart move, there are a few pitfalls. First, it may become harder to land customers because, from their perspective, higher prices may offset the advantages of free delivery. The other thing is that in the event of an order return, you need to cover it entirely as opposed to cases when the shipping cost is calculated separately.
2. Set Thresholds and Limits

Setting a particular subtotal value that unlocks the free shipping option, is an excellent method. Customers agree to buy more and higher sales counterbalance your shipping costs.

Do not set the threshold too low, it will hurt your margins, too high, and shoppers will be demotivated.
Set thresholds and limits to achieve free shipping
Conduct a simple experiment before settling for a certain shipping policy. Test your preferred shipping policy as a promotion first. If it is successful, you should find the conversion rate and average order value improved.
A subtotal value is not the only variable you can apply limits to. It may also be a delivery timeframe. Many customers are ready to wait for their package as long as they don't overpay. For instance, you may want to offer free shipping within a longer period, along with paid expedited delivery.
3. Run a Loyalty Program

Basically, this works like a threshold too: A customer has to earn that privileged membership. Whether it is by reaching a certain order value, paying a yearly fee, or bringing a friend.

Loyalty programs make customers stick with e-commerce. According to studies, free shipping is the #1 reason why 69% of consumers participate in fee-based loyalty programs.
Loyalty program to get free shipping
Amazon Prime is an excellent example: A customer pays $119 a year and gets free two-day shipping. The company's logistics costs, therefore, are offset by more frequent orders from Prime members compared to other customers.

Communicate Your Free Shipping Policy Clearly
Advertise free delivery at the most eye-catching spot of your landing page to convert visitors into customers. Use pop-up at the checkout stage to show the customer how much money they are saving—more validation for them to buy now and in the future.

Communicate with Your Affiliates & Partners
Communicate this message clearly to your close co-workers, partners, and suppliers. The message needs to be concise so remember to follow these steps as well.
First, communicate your free shipping options within your own circle of control (website, offline, social media, and marketing).
Second, don't forget to inform your influential affiliates and other business partners within your circle of influence.
Third, reach out to the media in order to correct earlier published shipping terms.

How to Configure Free Shipping with Calcurates?

for Shopify, Magento and WooCommerce
Calcurates will be there to help you configure the best-fitting shipping options. This all-inclusive shipping solution factors in a variety of shipping conditions and computes the most accurate rates.

Configure free shipping with Calcurates shipping solution:
  1. Navigate to Shipping Options in your Calcurates account
  2. Add a new Shipping Option and select the “Free shipping" type
  3. Set a name of your Free Shipping method and assign Shipping Zones where it is available
  4. Set minimum order subtotal threshold and SKU exceptions if there are any
  5. Set minimum and maximum days in transit as well as non-delivery days to calculate and display estimated delivery days together with your shipping method at checkout
  6. Make your Free Shipping on Shopify, Magento and WooCommerce even more flexible and condition-based using Shipping Rules
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