The benefits of free shipping offers are well documented; it simplifies the charges in the customers mind, and is a proven sales driver.
Luke Knowles from freeshipping.org has put together a free e-book (pdf) with some case studies and stats on free delivery.
Here’s a few of his tips on different types of free delivery / shipping offers…
Free delivery on everything
This is the most attractive version of the free delivery offer for customers, especially if it promoted prominently on the homepage, as done by retailers like John Lewis and Game:
This gives retailers a definite advantage over competitors not running such offers, but they will need t have high enough profit margins to be able to make this offer.
Free for minimum orders
This is a useful alternative to offering free delivery on everything, and can be useful for encouraging customers to spend a little more and increase average order values.
Amazon and Tesco are both offering this for the Christmas period, and this has the advantage of both providing an incentive for customers and allowing retailers to set the threshold at an affordable level in terms of fuel costs.
Another good idea with this kind of offer is to remind customers when they add items to the shopping basket that spending a bit more will qualify them for free delivery, something Borders does on its website.
Free delivery on selected items
Depending on the kind of products you stock, free delivery may not be a cost effective offer, so you could offer this for selected products only. This also provides a useful method of promotong items which aren’t selling so well.
Free delivery to a local store
Something also offered by Borders.co.uk, this allows customers to get items that may not be in stock at a local outlet and can be helpful for people who will not be around to get items delivered to their homes. It also has the added benefit of getting shoppers into stores
Free delivery for members
Not the best way to attract the casual shopper but this is a useful tool for customer retention. Amazon Prime is one example of this; for £50 a year members get unlimited free one day delivery.
Flat rate delivery
Not exactly free, but a flat rate delivery offer, with charges staying the same regardless of the product or quantity ordered, is another way of simplifying the purchase proposition for customers.