E-retailers have been trying to do away with free shipping for years, but the perk continues to be a powerful draw for online shoppers, says a new report from retail consultants Retail Forward Inc.
Retail Forward’s most recent survey of Internet users reports that 56% of online buyers have decided where to make a purchase based on the fact they could get free shipping. Furthermore, an overwhelming percentage of Internet users--70%--either strongly agree or agree that they would shop online more if they didn’t have to pay shipping and handling charges.
The results are timely as the shipping-charges battle is heating up among online retailers. Last week, Amazon.com reduced its minimum purchase for free shipping from $99 to $49. The next day, Buy.com offered free shipping on all orders. Buy.com says it saw an immediate spike in sales.
“Given the recent movements by the major e-retailers, it’s apparent that free shipping represents a competitive factor as much if not more than a marketing or promotional tactic,” says Geoff Wissman, vice president of Retail Forward and editor of the company’s E-Retail Intelligence Update newsletter. “Free shipping offers have the potential to substantially influence overall online sales.”
The recent jockeying for free-shipping bragging rights represents some cause for concern from an economic perspective, Retail Forward says. “While it doesn’t exactly take us back to the industry’s early days, it does cause one to worry if the industry is in the process of taking a step backwards,“ Wissman says.
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