Are you in this situation: you have launched your online store, done the necessary marketing and branding campaigns, ensured your online store is user-friendly and set affordable price. However, you are in a mix-up. When you look at your niche, everyone is offering free shipping. You wonder whether it is a good idea or not. The thing is, you are not sure whether doing this will have a negative or positive impact on your business or what will be the outcome.
One thing you are sure about is that this shipping option will require you to dig deeper in your pocket. Or else, increase your prices a bit to cater for the shipping costs. To help you make a credible decision, here are three ways in which free shipping can boost your business revenue:
Reduce cart abandonment
Indeed, you have information that substantial shipping costs are the primary reasons why customers abandon carts. A customer will go through your online store. Select their favorite products and put them in the shopping cart. However, before clicking the payment processing button, they will give a close-eye to the shipping charges. One indisputable fact is that shipping charges add up to the customer expenses.
As such, regardless of your product prices, a customer will abandon a cart if they feel your shipping rate is unacceptable. Offering free shipping can help you in solving this problem. With it, only a few customers will abandon their carts. This way, you will increase your sales and revenues.
Setting a threshold
At times, customers can misuse your idea of shipping their products for free. For instance, a customer might come to your online store and purchase a product amounting to $20. To ship the product to their destination, you find that It will cost you $25. Do you think the sale is a worthy one? Unless you are in business to give charity services, you will not subscribe to such an idea.
In this regard, you must create a solution where everyone benefits. One way to do this is to set a threshold for one to enjoy free shipping. In such a case, you will earn more revenue through bulky selling, and the customer will gain free delivery of their order to their location.
Offer free shipping for particular items
Not every product you sell on your store contributes to the profitability basket. Some have small profit margins while others earn you a 50% gain. In this essence, the profit margin should be the bar for determining whether to offer free shipping or not. Always ensure this option is available to products with high-profit margins and demand.
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