Importance Of Fast and Free Shipping in the eCommerce industry
5 min read
Today’s consumers expect fast and free shipping wherever they shop online. Amazon the giant eCommerce hub has set the standard when it comes to ecommerce shipping: 2, 1, and even same-day shipping have become their common practice.
In competing to this high standard Amazon set, eBay and Walmart have also adopted the 2-day shipping practice to get their selves in the game.
eBay Fast & Free: Listings that feature the Fast & Free logo guarantee that shoppers will receive the item within 4 days if both the buyer and the seller are located in the contiguous United States.
Walmart 2-day delivery: Walmart 2-day guarantees delivery within 2 business days for the contiguous United States. It’s completely free for shoppers, with no minimum purchase.
Sellers across marketplaces need to keep up with these fast-evolving customer expectations by providing fast, free shipping — or risk losing business. 38% of customers say they’ll never buy from an online seller again following a negative delivery experience.
On the other hand, if you offer a great customer experience all the way through delivery (and returns, if need be), you’ll reap the benefits:
Customers will be more likely to buy from you again. These repeat customers can boost your revenue to meet your expectations
- They’ll tell their friends and networks about the awesome experience, driving new business
- You’ll see increased sales and revenue
- Fewer shoppers will abandon carts
- And much more…
Benefits of fast and free shipping
Here are a few of the main benefits of offering fast and free shipping on your online store or marketplace.
1. Increase conversions and reduce cart abandonment
Nearly half of online shoppers who abandon their carts cite shipping and handling costs as the primary reason. 1/4 of customers have cancel an order due to too-slow shipping. Reduce cart abandonment and keep conversions high by offering the fast and free shipping your customers expect.
2. Boost customer satisfaction and loyalty
Nearly 3/4th of online shoppers expect affordable, fast delivery. When you meet this expectation, they’ll come back for more — and tell their friends. You can also include free shipping offers as part of a loyalty program, which is exactly how Amazon Prime has come to have over 100 million Prime members — and redefine ecommerce shipping standards.
3. Increase average order value
When you offer free shipping at a minimum purchase threshold (like free shipping for all orders over $40), many shoppers will add additional products to their cart to meet the minimum. A research study conducted by comScore and UPS found that 52% of American shoppers have added extra products to their shopping cart to meet a minimum purchase threshold.
Different fulfillment methods fit different businesses’ needs; there’s no one-size-fits-all solution. Here are some of the ways ecommerce merchants can offer free and fast shipping across marketplaces and shopping carts.
Some merchants choose to fulfill orders out of their own warehouses. Fulfilling orders in-house gives you full control over your packing and shipping processes — which can be both an advantage and a disadvantage. Offering same-day (or even two-day) shipping can be unreliable and expensive when fulfilling orders in-house and relying directly on the major providers. It can be difficult to meet different marketplace’s fast shipping guarantees (and qualify for Amazon Prime and eBay Fast ‘n’ Free badges) when fulfilling orders in-house.
Fulfilled by Amazon (FBA)
Over half of the top 1000 sellers on Amazon use Fulfilled by Amazon (FBA). This lets merchants become part of the Amazon Prime program, which guarantees two-day shipping to customers who buy their products from Amazon. Unlike Amazon’s Seller Fulfilled Prime (SFP) program, where you’re responsible for shipping out orders with two-day shipping, FBA means that Amazon stores, packs, and ships your inventory to the end customer.
Of course, Amazon Prime only applies to orders placed on the Amazon marketplace; if you sell on other marketplaces or through your own site, you’ll need an additional fulfillment method for those orders. FBA also incurs seller fees on each item shipped through Amazon.
Third-party logistics (3PL)
Partnering with a third-party logistics provider, also called a 3PL, helps you fulfill orders more quickly than you can in-house. You send your inventory to the 3PL’s warehouses, and they ensure it gets shipped out in time to meet a shipping guarantee. You can also distribute your inventory across different regions, which in turn puts your inventory closer to your end consumer and provides cost savings for two- and next-day shipping. At a 3PL’s warehouse, staff pack and ship items as soon as a customer places an order on a marketplace or online store, then sends tracking information back to the seller.
The most convenient model which will benefit sellers is without doubt the dropshipping model. Dropshipping is a method of order fulfillment where ecommerce companies and retailers do store inventory, nor fulfill orders themselves. Instead, the burden of order fulfillment is generally on the supplier, who ships the goods to the end consumer. The advantage is that the entire business model is hassle-free and cost effective. You do not need to invest heavily in inventory, nor pay for fulfillment. The caveat is that you have little control over the supply chain, including the availability of goods and must rely on your suppliers completely.
The conventional dropshipping business model is a popular strategy for especially small businesses and works best for retailers who have a limited budget for marketing and advertising.
Now a days dropshipping on Facebook is gaining huge attention from sellers and many of them are reaping revenues beyond their expectations. For 2023, a pro tip would be to start dropshipping on Facebook marketplace and Facebook shops. This would prove a positive game changer for the economic condition of any seller as this business model could be started with very minimal investment and its ROI could be much more than any other business without fearing of shipping costs and fast delivery. A tool, I would highly recommend is MarketplaceFlow (marketplaceflow.io) which is compatible on both Facebook Marketplace and Shop.
For more details on MarketplaceFlow, you can visit these sites:
Conclusion Fast and free shipping in eCommerce industry can boost your store revenue in no time. Examples of this is Amazon, Ebay and Walmart etc. From sellers point of view to gain the perks of fast & free shipping and gain maximum revenue out of it, then dropshipping is the most convenient business model for them.