Benefits of Fast & Free shipping
Fast & Free Shipping is the New Norm
Customers expect fast and free shipping when shopping online, especially since Amazon has set the standard with their free one-to-two-day shipping. As a result, other online marketplaces like eBay, Target and Walmart are now offering free two-day shipping as well.
According to a recent article by Retail Dive, about 73% of customers will abandon a brand after 3 or fewer negative shopping experiences, most often associated with shipping and delivery. Not only are customers expecting free and quick delivery, but they also want a consistent shopping experience regardless of what and when they are ordering.
Offering fast, free and reliable shipping is a must to remain competitive as an online seller. But this isn’t the only reason. Below we’ll outline some more of the benefits of fast and free shipping along with fulfillment methods that can help your business succeed.
Why Fast & Free Shipping Matters
1. More Conversions, Less Cart Abandonment
Cart abandonment is a common problem for many online sellers. Customers are shopping and adding to cart, but something stops them from reaching checkout. While there may be a few reasons why; a major reason is the shipping options offered. According to Moosend, 60% of carts are abandoned due to shipping-related reasons such as high shipping costs, lack of delivery options, or slow fulfillment and shipping times.
Offering fast and free shipping can increase your order conversions and reduce cart abandonment. Customers are more likely to purchase knowing that shipping is free and that no additional fees will be added at checkout. Another option is to set up an abandoned cart recovery email with a free shipping coupon to entice customers who are on the fence.
2. Increase Customer Loyalty & Satisfaction
Online shoppers appreciate consistency. Fast and free shipping not only meets customers expectation, but it also creates brand loyalty increasing the chance for repeat purchases. The major carriers (FedEx, UPS, USPS) are fairly consistent with their delivery and can provide negotiated rates, providing consistent shipping options for your customers.
Another option is to implement a loyalty program similar to Amazon Prime. This could be a buy-in membership or a reward for customers with repeat purchases. Free shipping can be a big motivator and can encourage customers to shop with you often.
Providing consistent and free shipping is a no brainer, especially if it increases customer satisfaction and brand loyalty.
3. Higher Average Order Value
Customers appreciate a good deal. According to Hubspot, 24% of customers would spend more to qualify for free shipping. By offering free shipping for a minimum order amount, customers are more likely to add products to their cart to unlock free shipping.
On the other hand, offering free shipping right off the bat can also encourage customers to add more to their cart. Since they don’t need to worry about shipping costs, they are more likely to use what they would’ve spent towards another product.
Not only can free shipping increase your online conversions, but it can also increase your average order amount.
Fulfillment Methods to Help You Succeed.
There is no one-size-fits-all fulfillment solution. Different businesses have different fulfillment needs so it’s important to understand how each can benefit your business. Here are the options.
Direct Fulfillment
Many small-to-mid-sized businesses handle their fulfillment in-house through their warehouse. This gives you the flexibility to control the fulfillment process including custom packaging and shipping options/processes. However, there is a drawback to fulfilling in-house. Depending on your warehouse’s workload, offering same-day fulfillment may be taxing on your resources and can lead to unreliable processing and shipping times. While many businesses start by handling fulfillment in-house, increased costs and lack of consistency attributed to growth can make this a more expensive option in the long run.
Fulfilled by Amazon(FBA)
Amazon’s FBA is a popular option for many online sellers. Not only do they provide the Amazon Prime Badge guaranteeing free two-day shipping, but they also store, pack and ship your products so that you can focus on selling your products. Not having to deal with fulfillment and being part of the Prime program is a major selling point for Amazon sellers.
However, fulfilling through FBA has a couple of disadvantages. First, FBA costs are directly tied to Amazon’s operating costs. As a result, FBA costs fluctuate every year to reflect the increased costs of storage and transportation that Amazon has. While not having to worry about fulfillment is enticing, increasing FBA costs and peak season fees may make it more expensive than fulfilling in-house or through a third-party provider.
Third-Party Logistics (3PL)
Outsourcing your fulfillment to a third-party logistics provider can be quicker and less expensive in the long run. Like FBA, 3PL providers store, pack and ship your inventory while giving you access to additional value-add services like bundling, kitting, and custom packaging. In other words, you get the best of both worlds. The network and resources of a major shipping partner with the ability to customize your fulfillment process. 3PLs are also strategically located to be able to offer quick, affordable and reliable shipping to anywhere in the US.
Not to mention, 3PL providers qualify for the “Seller Fulfilled Prime Program” where your products will still be able to display the “Prime” badge but will now be fulfilled by your 3PL provider. There are a few requirements for the program, to ensure your 3PL can fulfill the two-day shipping guarantee.
While, 3PL providers provide the flexibility to grow your business, reduce costs, and improve your customer’s experience, it may not be the right option for you. For example, it can be an expensive investment for startups and might not be the right option for your business’s fulfillment needs.
Which is Best for You?
Whichever solution you choose for your business, C2W Distribution can help. We offer both 3PL & 4PL solutions to meet your fulfilment, eCommerce, dropshipping, & storage requirements. By leveraging our state-of-the-art equipment and technology, we’re able to fulfill your business needs while making your supply chain more efficient, reducing costs, and improving customer satisfaction. Leave the logistics to us, while you focus on your core competencies.
Interested in learning more? Contact us today to see what we can do for your supply chain.