7 Creative Ways to Offer Free Shipping in eCommerce
By Avitanshi Srivastava • November 14, 2024 • 9 mins read
Free…Free…Free
The word “FREE” is motivating enough to inspire and drive people towards shopping or final purchase decisions. Offering Free Shipping to customers is one of the clever ways that has proven to be one of the most effective Holiday marketing strategies for businesses. Well, it is just a strategy that plays with consumer psychology.
Sellers are like “Shhhh…it’s profitable to me, do not let customers know about this.”
Let us tell you, it is FREE shipping, which doesn’t mean it makes you spend extra money to attract customers—rather it’s a clever technique to earn more than you spend.
If you are an e-commerce owner—looking for creative ways to offer FREE shipping, keep reading this post.
Wait…don’t think that you won’t be able to offer FREE delivery just because your business can’t afford it, there are several ways you can promote FREE delivery without impacting your profits.
Let’s start with 4 amazing statistics about FREE shipping based on customer psychology:
- ▶ 62% of online shoppers won’t make a purchase without free shipping—this means that customers scroll through products and check prices with the FREE shipping option. If free shipping is not available, they just ignore that product.
- ▶ 93% of consumers shop to qualify for free shipping, often buying additional items—this is wonderful; customers add extra items to their cart, just to qualify for FREE shipping.
- ▶ 48% of consumers abandon their cart due to extra shipping costs—this indicates that the customer selects a product, adds it to their cart, and then abandons the cart when they find out about the additional shipping cost at checkout.
- ▶ 82% of shoppers are more likely to complete a purchase if delivery is free—this means, there are 82% of chances of conversions due to FREE shipping.
Stats Source: Sellers Commerce and Capital One Shopping
Source: Sellers Commerce
70% of consumers prefer FREE shipping when shopping online. This highlights that the convenience of free shipping can be a deciding factor in whether someone buys online or opts for an in-store purchase.
The above statistics clearly show not offering free shipping to your customers can cost you a lot for your business. No wonder this tactic has gained massive popularity lately, as this has multiple advantages. Customers love it when they don’t have to pay additional shipping charges to purchase the product.
Shipping charges can act as a hidden cost for customers leading to them abandoning their carts. Imagine a customer has opened a product page with excitement only to discover that they have to pay an extra charge to ship their product.
This is when shipping options play a crucial role in customers’ purchase decisions.
Here are a few of the reasons why you should not ignore the “Free Shipping” option for your business:
- It inspires customers to complete their purchase action
- It lessens the abandonment of carts at the checkout
- It lets your business stay competitive or gives it a competitive edge over your competitors
- It increases the order volume and sales
Seven Creative Ways to Offer Free Shipping
Now, let’s explore seven creative ways you can consider when offering free shipping to your customers:
1. Minimum spend limit threshold
Setting a minimum spend limit or minimum order amount is the best way to offer Free Shipping to your customers. For instance, set a minimum spend amount of $50 to avail of the offer. This will attract and encourage customers to add more items to their cart to qualify for the offer. Moreover, this will also eventually increase your average order value and boosts your sales and revenue.
You can see (refer to the below image) how Under Armour has offered free shipping on orders above $99 with Free returns.
2. Higher product price
Another way to offer Free Shipping is to merge the shipping cost with the product price and set the product price higher. This will create an illusion to customers that they are getting the product free of shipping cost. On the other hand, you will also not be bearing the loss. Thus, it’s a win-win situation for both the retailers and customers.
3. Free shipping on buying a certain number of items
Offering free shipping on or above certain items will not only eliminate the chances of losing your customers due to the higher price of the products, but it will also encourage the shoppers to go for large volume orders.
For example, offer free shopping on buying 3 items. Another example of promoting this method is – let’s say a customer reaches the checkout page, you can recommend other products with a message saying, “add one more product to your cart to be eligible for free delivery.”
4. Free shipping on limited products
If your business can not afford free shipping on all products or you want to reduce the impact it can cause on your business’s profits, consider limiting the offer to only a selected number of products.
For example, you can offer free delivery on products with higher profit margins as compared to offering the same on oversized products. Shipping oversized items for free might cost you a lot of money; in such cases, you can add some shipping costs to the product’s price.
5. Free shipping for first-time customers
This is the best option to leverage to build your customer base and attract potential customers. Acquiring new customers and getting them to your website is the biggest challenge most startups or small-sized businesses face. Thus, the offer can act as a motivational factor for first-time customers, and this could lead them to become your loyal customers in the future if they are impressed by your products and/or services.
6. Discounted shipping price for loyal customers
To retain loyal customers and push them toward repeat purchases, consider offering free or personalized discounted shipping offers to your loyal customers. Appreciate their loyalty, tell them you value them, and thank them for trusting you over time. This will make them feel valued and encourage them to become your brand advocates.
7. On specific days of the year
Another method is offering free shipping on certain days of the year. Incorporating this method, especially on major Holidays during the Holiday Shopping season, will increase the benefits of the offer. The last quarter of the year is no less than a boon for retailers, and every business leaves no stone unturned to reap the maximum benefits out of season. Consider offering free or discounted shipping on major Holidays like Thanksgiving, Black Friday, Christmas, or New Year to boost your sales.
Tips To Promote Free Shipping Offers
Offering free shipping is great but promoting the offer is equally essential for your business. You need to let your prospects know what you are offering.
1. Through the email list
An email list is one of the most crucial databases for eCommerce businesses. Utilizing your subscribers’ list is the best way to promote shipping offers to your customers. Plan your email campaigns in advance and start promoting them to people during the Holiday season. Prepare email templates in advance and schedule the emails accordingly to get the maximum results.
2. Social media announcements
Social media is the best place to connect with your customers. On average, an internet user spends 6 hours, 53 minutes online per day! Surprising? This average time spent on social media is more than enough to motivate business owners to promote product updates, offers, or discounts. Thus, social media channels are another effective way to reach out to your customers and promote the offer.
3. Optimize your store
One of the best solutions to convert window shoppers into paying customers is by adding the offer bar at the top of your website, just like Van Heusen did (refer above image). Websites are where people research or compare products they are looking forward to purchasing. Let your customers know about your shipping offer and drive them to complete the purchase.
Why do Consumers Abandon Their Carts?
Many cart abandonments are due to natural browsing behaviors like window shopping, price comparison, saving items for later, and exploring gift options. These are largely unavoidable.
A recent study found that 48% of US online shoppers abandoned a cart in the last 3 months because they were “just browsing / not ready to buy.” Most of these abandonments occur before the checkout process begins. When excluding this segment, the remaining reasons for abandonment are distributed as follows:
- High extra costs (shipping, taxes, fees)
- Complicated checkout process
- Mandatory account creation
- Concerns about payment security
- Slow delivery times
- Unsatisfactory return policy
This highlights the importance of optimizing the checkout experience to reduce abandonment rates.
Source: Baymard
How you can calculate your FREE shipping limit
Most brands can’t offer universally free delivery. So qualified free shipping based on order size or location is a good alternative. The simplest way is to set a minimum order amount that covers costs.
Free shipping threshold = (Average shipping cost per order / gross profit margin percentage as a decimal) + average value of an order
Free shipping threshold = ($20 / .60) + $100
= $133.33
This ensures free delivery doesn’t result in a loss.
Summing Up…
Offering free shipping is a great way to get more customers to your store or to inspire them to shop from your store. To remove the shipping barrier between your prospective customers and the checkout process, this is an effective strategy to boost your business profits. Choose the free delivery method considering what and how much you can afford for your business and offer accordingly.
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