A Forrester report points out challenges faced by some business-to-business firms working online.
294 of the Top 1000 online retailers in North America were offering free shipping on all orders last week, an Internet Retailer survey shows. That’s an increase from 255 in early November. Another 331 web retailers last week promised free shipping with a minimum purchase.
Looking to capture last-minute sales, more top online retailers offered free shipping on all orders as an inducement last week than in early November, an Internet Retailer survey shows.
Of the Top 1000 web retailers in North America, 625 promoted some kind of free shipping offer on their home pages, up slightly from 623 in early November. But the big change was in offers of free shipping on all orders, regardless of the amount purchased: that went up 15% to 294 last week from 255 for the week that began Nov. 4.
The prevalence of unconditional free shipping offers is even more pronounced when comparing today to five years ago. In 2008, an Internet Retailer survey of the Top 100 e-retailers found only two—Zappos and Blue Nile—offering free shipping on all orders. Last week, 43 of the top 100 web merchants promised free shipping regardless of purchase amount.
Among the top retailers that recently added free shipping on all orders was Neiman Marcus, No. 39 in the 2013 Top 500 Guide, which announced in October it would from now on not charge to ship online orders. Not included in the 43 offering free shipping on all orders is Amazon.com Inc., No. 1 in the Top 500, although some of its subsidiaries, including Zappos.com, which Amazon bought in 2009, offers free shipping, including on returns.
Amazon, in fact, raised the minimum required for free shipping to $35 from $25 just before the holiday shopping season. However, many observers viewed that as Amazon trying to nudge more consumers into signing up for Amazon Prime, which offers free two-day shipping on all orders plus other perks for a $79 annual fee. Amazon doesn’t disclose how many consumers have signed up for Prime, although analyst estimates range from 10-15 million.
Wal-Mart Stores Inc., No. 4 in the Top 500, went the other way this holiday season, lowering its threshold for free shipping to $35 from $50. What’s more, 99% of items sold by Wal-Mart itself on Walmart.com are eligible for free shipping to consumers’ homes this year, up from 15% last year, a Wal-Mart spokesman says. And more than half the items offered by outside retailers that sell on the Walmart.com marketplace ship free.
In addition, Walmart.com has tripled to 70,000 the number of items that consumers can pick up for free in Wal-Mart stores the same day they place the order online. Use of that same-day service has more than doubled this year over 2012, the spokesman says. “It’s another example of how we combine digital and physical to serve customers when, how and where they want,” he says. And there’s still time to order before Christmas. Shoppers can order online for same-day pickup at Wal-Mart stores until 6 p.m. local time this evening; orders placed between 6 pm and midnight can be picked up tomorrow from 10 a.m. until store closing. Wal-Mart stores will be closed Christmas Day.
The Internet Retailer survey of Top 1000 e-retail home pages last week also revealed that 70 e-retailers were promoting free return shipping last week, down slightly from 73 in early November.
Of those 1000 leading retail web sites, 39 promoted on their home pages last week that they would match prices of at least some competitors, a slight increase from 37 in November.
And some e-retailers offered to match price, but were not promoting it on their home pages.Walmart.com, for example, had promoted its Christmas Ad Match policy on its home page early in the holiday season, reasoning that customers were focused on finding deals early on, the Wal-Mart spokesman says, but was no longer promoting it on the home page last week. However the offer to match a price of a local bricks-and-mortar retailer on the identical product remains in effect, even though it’s not so prominent on Walmart.com. “At this point in the holiday, customers are really focused on last-minute gifting, so you see the messaging on our home reflect that,” the spokesman says.
For those 331 web retailers that require a minimum purchase for free shipping there is a wide range, although only 42 require a purchase of more than $100. Most require a purchase of between $50 and $100. The lowest threshold is $9.99 at music retailer Sam Ash Music Corp., No. 285 in the Top 500, and the highest is $1,900 at Aus-Tex Appliances, No. 991 in the Second 500 Guide, which ranks web retailers Nos. 501 to 1000.