Even though it seems to be all around us, the reality is that e-commerce in India is still in a very nascent stage. Numerous efforts have to be made to attract individuals towards making a purchase. These are necessary expenses which you have to bear so that the users feel valued. Free shipping is one of these costs. The vast majority of e-commerce users are still not ready to pay for shipping and hence you have to lure them into making a purchase through free shipping.
According to intelligence solution firm Feedvisor, 85% of Amazon users hesitate to make purchases because of shipping charges and slow shipping disappoints both Prime and non-Prime members (60% and 41%). Considering that it is a global issue, there should be very less scope for anyone but well established firms to include shipping charges in the final price. Here are a few reasons why free shipping is always preferable over cheap shipping.
1) Makes Customers Feel That They Are Saving
The reason why free shipping works so well is that customers feel as if they are saving on money. This illusion is effective in a country where the majority of the population is still attracted to discounts and price discount campaigns are successful. Free shipping is not a direct discount, but achieves the same objective: to make users feel that they are getting value by purchasing a product at a lesser price.
2) An Opportunity To Make More Purchases
The word free is extremely attractive because it sends a signal that the product is easily available. Add to the feeling that the customers feel that they are saving (mentioned above), and you have an element which attracts customers by giving them an opportunity to make further purchases.
3) Provides An Additional Marketing Tool
As mentioned earlier, free shipping is a value added service. It can be used as an effective marketing tool to show the inclusion of a value added service in the product offering. The customer can be led to believe that the store is doing something additional for them. Promoting free shipping is certainly not a unique proposition, but its absence from your overall marketing strategy can lead to a lack of users visiting your store.
4) Customers Prefer Free Shipping Over Expensive Products
An extremely common shipping strategy is to include the price for shipping in the final price without mentioning it. This works because customers prefer to pay more for a product instead of paying lesser for the product and the shipping. Adding the shipping price in the final price taps into their psychological wants and they do not realise that they are paying for the shipping as well, which is a win-win scenario for both the parties involved.
5) Empower The Customers By Giving Them A Choice
A smart strategy to empower your customers could be to include the option of paid shipping on a certain product range. The rest of the products could have free shipping. Making customers feel that they are choosing between paid shipping and free shipping will empower them as they will feel that they are making a choice. This is another form of marketing which invokes strong feelings in the customers.
Many startups are hesitant to put free shipping in their product pricing because they feel that they cannot bear the cost. However, you must understand the reason for this seemingly huge cost and the fact that you can actually include the cost in the price. This way you get to market the feature and not lose out on extra expenditure. Happy Shipping!