In its second-largest acquisition, Amazon buys the company for $970 million.
Almost all orders of $50 or more trigger free shipping. In the past, only qualified items counted toward the total for free shipping.
Target Corp. will now ship for free almost all orders over $50. Previously, only certain items qualified for free shipping when the order value exceeded $50. Now only oversized and heavy items will be excluded and subject to an extra handling fee.
A Target spokesperson says the new policy has added thousands of more items to the free shipping list.
“We’ve heard from guests they don’t fully understand our shipping policy—so we’ve changed it to make it simpler and reduce the friction in making purchases on the site,” says Jason Goldberger, senior vice president, Target.com and mobile. “Providing our guests a better free shipping offer is just one of the many ways we continue to improve the Target.com experience.”
Target, No. 18 in the 2014 Internet Retailer Top 500 Guide, generated an Internet Retailer-estimated $2.3 billion in 2013 web sales.
The change puts Target more in line with competitors. Walmart.com, No. 4 in the Top 500, offers free shipping on orders over $50. Sears Holdings Corp, No. 5, offers free shipping on orders of $59 or more.
Amazon Inc., No. 1 in the Top 500 Guide, last year raised the threshold for free shipping through its Free Super Saving Shipping Program from $25 to $35. The company said that was the first increase in 10 years.
Consumers clearly value free shipping of online orders. A recent study from the United Parcel Service and comScore Inc. found 58% of consumers have added items to their shopping carts to qualify for free shipping, and 83% are willing to wait an additional two days for delivery if shipping is free.