Did you know? Unexpected or just downright unrealistic shipping fees is the number one offender leading to abandoned shopping carts. In dollars, that’s about $4 Trillion in lost sales – all from shipping issues! [Source: BI Intelligence, 2014]
The second biggest reason for customers bailing upon checkout was that they failed to meet the requirement to get free shipping applied to their cart. Again, out of all the reasons a shopper could abandon their cart, shipping is the culprit.
Could you imagine what a revamp could do for your current shipping program, or what taking an extra moment to clearly map out your new store’s shipping policies could do for your bottom line?
“FREE SHIPPING” Isn’t Just a Marketing Ploy
Offering promotions like “Free Shipping” is a commonly used best practice for drumming up business online. Why? Shoppers love free and easy shipping methods!
Shipping methods can make or break a sale. Even after an item has been purchased, if a customer is unsatisfied with the customer service and shipping experience, they are likely to request a refund – even further complicating things, especially if you’ve already got the package on the way! When you add options like gift wrapping, extra charges for oversized or fragile packaging, and faster delivery time, the scenario for meeting the shipping expectations of your customers just got a little more complex.
This is why it’s important to consider a well-thought out plan of attack for your online store’s shipping offerings.
Ecommerce Shipping: The Fastest Way to Lose a Customer
Here’s a real life example:
I went to a company’s website to purchase tickets to an event. Set up to capitalize on impulse buys, the site had a few pretty awesome t-shirts you could add to cart when buying the tickets. I completely fell for it, and added 1 t-shirt to my cart. But I was in for an unpleasant surprise.
When I continued to checkout, I had a mild heart-attack when I saw that they wanted over $10 to ship a $18 t-shirt. As if that wasn’t bad enough, it was going to be shipped and delivered within the same city! I’m sure others also quickly removed the t-shirt and only proceeded with buying their originally intended item (event tickets).
This is a prime example of what not to do, and shows that the company either A) doesn’t care about the pains of their customers (high shipping costs), B) counts on customers not looking at the shipping cost before moving forward with their purchase, and/or B) hasn’t bothered to figure out a low-cost way to ship the shirts. None of these are good when you’re counting on eCommerce revenue to grow your business.
Factors to Consider When Choosing Shipping Options
As a store owner, you need to be sure you’re ready to provide shoppers with shipping methods that fit their needs. Some shoppers may want the item right away, and might not mind paying extra for 1- or 2-day shipping options. Others may be satisfied with a standard, more cost-effective shipping time.
Consider any special restrictions and limitations of your product:
- Does the size or weight of the product complicate the shipping process?
- Is it something that is perishable, like fresh goods, and requires prompt distribution?
- Will the product need extra time to be customized before shipment?
- Can you handle international shipping?
Another variable in the shipping methods you choose to offer your customers is the carriers. The United States Postal Service (USPS), UPS, and FedEx are common shipping vendors in the eCommerce industry, and are seasoned veterans in delivering online orders on-time and within budget. Content Management Systems (CMS) like WordPress’ WooCommerce or Magento have pre-built extensions to easily integrate shipping options from these popular providers with your online store.
Prepare Against Sour Customer Expectations and Colluded Shipping Processes
- Make it as easy as possible for the customer to receive your product. Remove all barriers, including ease-of-purchasing and costliness, and educate the customer on your processes. Don’t discourage them with a hefty shipping fee, or an affordable option that takes over a month to deliver!
- Provide customers with a clear understanding of shipping rates and fees. Don’t surprise them with a $10 shipping charge on an item that’s under $20. You’ll quickly lose sales without a second-thought, doing that.
- Prepare ahead of time. Avoid bottlenecks by coming up with a comprehensive shipping ecosystem on your backend that accounts for any variables that may head your way. There’s no need to lose sales because your business operations weren’t as attractive as the product you’re pushing.
In all of this, remember that it comes down to the customer: Which shipping method will make the shopping experience most enjoyable and stress-free for the customer? Are you able to provide competitive rates on your products? Are you providing the customer with sensible, realistic shipping options for the products you’re selling? (Example: No $10 shipping on a $20 item!)
The Cost of Shipping: Thin Your Margin to Beef Up Your Revenue
In the world of eCommerce, shipping is when a virtual order turns into a tangible transaction. It’s easy to think about buying paths and processes online, but things get real when it comes time to put the physical item in the customer’s hand. To offer attractive shipping options that don’t turn your audience off to a sale, you may have to face the music and be willing to cover some of the cost of shipping.
There is no way you’ll get many orders for $50 worth of your product, when the cost of delivery (plus taxes) bring the total closer to $100. In some cases, customers would rather spend more on the product itself, just to get free shipping!
Either way, it’s likely you’ll simply have to bring the cost down. Eating some of the shipping cost will make it more attractive for shoppers to buy, leading to more sales, and ultimately more revenue than if you had not offered to pad shipping costs at all.
Take a Lesson from Shipping Facilitation King, Amazon.com
Another interesting example of how shipping preferences may vary is Amazon.com’s recent campaign to slow down shipping and promote the Amazon Pantry. Amazon gave shoppers a choice: They could proceed with the regular 2-day shipping, or opt-in to downgrade to 3-5 day shipping and receive $5 off their next order on Amazon Pantry items.
People are using Amazon for every scenario, from early preparedness – shopping weeks in advance of when they’ll need the product – to acting on the infamous, “Oh crap!” emergency moment. So, a seller on Amazon may think that most people wouldn’t need or want something like laundry detergent ASAP, but actual customer behavior may reveal that many people are relying on Amazon’s fast shipping options when they run out of the item and need it quickly (Let’s ignore the fact that they could go to the grocery store and just as easily get this item… Many people, such as moms and busy families with young children, will choose the Amazon route vs. loading up the car and fighting the traffic to go to the grocery store for the item).
This is a prime example (no pun intended) of how you may think that you know your customers inside and out, but you may be surprised if you were to give your customers different shipping choices.
Finding the Best Shipping Options for Your Ecommerce Store
As marketers and business owners, we’re constantly thinking of ways to get users to turn into customers – it’s all about making the sale happen. We often forget to solidify the activities that occur after the sale. For the sake of customer satisfaction, loyalty, and retention, these after-sale processes can be just as important as your pre-sale strategies. Shipping is no exception to this.
You may have the greatest proprietary product on the market, and customers may be chomping at the bit just to reserve theirs, but if it’s not reasonably easy for the customer to actually receive the product, you’ll quickly find yourself struggling.
If you’re embarking on your first eCommerce project, don’t let shipping requirements stop you! While the repercussions of failing to provide reasonable shipping accommodations may be no joke, a strong, viable set of shipping options might be the competitive edge you need to blow your competitors out of the water with a following of satisfied online customers.
Just be mindful of how customers may shop for your product, the special requirements of the product you’re delivering, and be open to trimming your margin to offset shipping costs for the customer, in order to receive a substantially larger return.