Holiday: The two magic words for consumers – “free shipping”

Holiday: The two magic words for consumers – “free shipping”

November 16th, 2010 by Fiona Swerdlow, Head of Research, Shop.org
Posted in @Shop.org | Holidays | Marketing | Research

With all the recent free shipping announcements from industry heavy weights such as Wal-Mart, Neiman-Marcus, L.L.Bean and Saks Direct, among others, today’s holiday blog topic couldn’t be anything but free shipping. If you perused the eHoliday 2010 pre-holiday consumer and retailer survey results (conducted in late September / early October in partnership with BIGresearch), you probably weren’t caught entirely by surprise by some of these developments, of course.

Online consumers have signaled that free shipping offers – both outbound and return – are a big draw:

• More than 4 out of 5 shoppers said they would most like to use free shipping with no conditions for their online holiday purchases.
• On a scale of 1 (not important at all) to 5 (very important), consumers ranked free return shipping offers specifically a 4.3. That’s ahead of other things such as promotions in general (4.2), the ability to see product reviews from other customers (4.1), and clearance sale pages (4.0). (NB — 3 out of 10 women would like to receive free return shipping offers.)

Turns out retailers have been pondering their holiday free shipping strategy for some time:

• Almost a third of retailers surveyed noted that they were likely to start their free shipping offers earlier in the season than last year.
• When asked which three promotions they planned to most heavily emphasize this holiday season, over half indicated free shipping with conditions, while one fifth promised free shipping without conditions.
• Furthermore, over a third budgeted somewhat or significantly more for free shipping offers this year than last (just over half indicated they are keeping this budget item in line with last year).

Clearly, the free shipping debate is far from over. You’ll always keep an eye on what your competitors are offering, but most important is to make sure you’re offering your customers what truly resonates with them. So, just as you do for other parts of your business, test a variety of shipping offers and see how your customers respond. For example, while free shipping is certainly nice, I was pretty happy with the $2.95 flat shipping fee I paid yesterday for my Bluefly order. And depending on what I’m buying, free return shipping could actually be more important to me than outbound free shipping.