Recently I was studying a client’s competition, reading industry forums and gathering insight into how to generate more website sales. During my research, I noticed something really interesting about how people react to different shipping promotions.
First I read a number of forum posts where people were thrilled with a competitor’s shipping promotion that offered $4.95 flat shipping rate regardless of order size. A few posted comments mentioned how individuals would buy more higher volumes of product to lower the “per product shipping cost.” What was surprising is that many of these people preferred the flat rate shipping over other free shipping promotions that included conditions like free shipping over $25. In reality, the free shipping with conditions offered greater financial benefit over the flat rate, especially on higher volume orders. Yet psychologically, people somehow associated a better deal with the flat rate.
Secondly, I discovered that although shipping costs were important (the lower the better), the SPEED of delivery appeared even more important. I have noticed with my client’s sales, that a number of customers will decline free standard ground shipping and pay up to 25% - 30% of the product cost in shipping charges just to get the products a few days faster!
If you can offer “fast and free shipping” as a value proposition, my guess is that you will experience an increase in website conversion.
Posted on September 11, 2007
