How To Offer Free Shipping on Your Ecommerce Store & Still Make a Profit - Episode 4

Welcome to the fourth episode of the Ultimate Guide to Profitable Free Shipping. This week we shall talk about the different marketing campaigns to offer free shipping. Investing in marketing campaigns leads to customer acquisitions and long term growth, and sales point 16 through 20 will focus on how free shipping can be used as a marketing tool to do just that. Number 16 offer free shipping with loyalty programs under loyalty programs, customers enjoy different perks such as discounted pricing and access to special services. In return, they are expected to pay a nominal subscription fee or maintain membership points, a proxy for regular purchases. Offering free shipping under loyalty programs will cost you money, but the big picture is the bottom line. If the customers buy more frequently, the reduced margins are overcome by the increased sales. So it is essential to design a loyalty program that starts with free shipping that caters to the other specific needs of your target customer. Customers won't spend more. For example, you end up having rewards cards from all the supermarkets and the reason to shop with one is not always the rewards card. On the other hand, Sephora's Beauty Insider is a great loyalty program with perks that are wanted by their customer and therefore encourage more sales. Number 17 offer free shipping for a limited time period Some businesses cannot afford to get free shipping, but that shouldn't stop you from using free shipping for marketing. Offering free shipping for a time period can turn window shoppers into paying customers. Once you acquire the customer, the relationship can be nurtured to drive sales in the future. You can also get creative with limited time free shipping for individual customers. For example, offer free shipping at the end of checkout on the next purchase. This will encourage them to explore more of your catalog and build a closer relationship. Limited time offers are relatively inexpensive and do not need big changes in your operation. They are easier to implement and can be discontinued easily. Number 18 offer free shipping during peak season only different businesses have peak seasons at different times of the year. Could be holiday season, Valentine's, or even Prime Day. With increased demand and every other seller vying for customer attention, it becomes imperative to make your products as visible as possible. Shipping charge is the easiest way to drive customers away in a competitive environment. Peak season is one time when the customer comes looking for you, so do not miss the opportunity at the core of it. It is a matter of choice between sticking to your margins and getting more sales with a margin. Exercise caution if your shipping expense is more than the margin. Acquiring customers at a loss during the peak season may not pay off if off peak sales are drastically low. Number 19 offer free shipping on returns only the ability to return items is an important aspect of online shopping. In some categories such as fashion, house, decor and jewelry, it is one of the most important decision making criteria for customers. If the customers are not 100% sure of the item they see online, the risk of potential loss is enough to deter them from completing a purchase. Therefore, offering free shipping on returns can simplify the process and take out at least the monetary aspect of uncertainty, but it still hurts sellers. If customers return all the time. Returns can be reduced by conveying the product value accurately. This can be done by having detailed product information section, multiple size charts, FAQs and useful visualizations. This will reduce total returns and increase profit. 20 offer free shipping to first time customers only if you are a new seller or have a new product portfolio, the biggest hurdle at most times can be getting customers to try the product. It is a classic strategy used across industries. Simple yet effective online delivery services such as Postmates have used it extensively to get customers to purchase for the first time on their platform. A category that can benefit from this promotion is Consumables. For example, Petco offers free delivery on the first two orders. Once the customer is locked into using product, the subsequent deliveries can be charged to recover all the shipping expense. However, it is not recommended for categories with little differentiation as customers will switch easily after the free Delivery. To summarize, fourth episode 16 offer free shipping with loyalty programs offer free shipping for a limited time, 18 offer free shipping during peak season, 19 offer free shipping on returns only and 20 offer free shipping to first time customers only. Thanks for watching the fourth episode of our series. If you enjoyed our content, please share this post with a friend or colleague who might benefit from this series. Subscribe for more such content and keep an eye out for episode five next week in which we will share how to make free shipping profitable without sourcing fulfillment. And lastly, sign up to our newsletter for even more awesome content delivered right to your inbox. See you next time.