Table of Contents
Have you ever suffered from a high cart abandonment rate and low conversion rate, although you made sure that every detail in your marketing strategy and website is on point?
Facing this case can be frustrating and puzzling!
You might definitely have done everything right, but you may have forgotten a single tiny detail that can affect your business much more than you think!
It’s your shipping strategy! Shipping is more than just a means to bring products to customers, It can be used as a marketing strategy to attract potential buyers and make them want to come back.
A good shipping strategy is really important for your business to grow because it directly affects how happy and satisfied your customers are. By implementing the right shipping strategy, businesses can ensure the timely delivery of products, which in turn leads to increased customer loyalty and repeat purchases. An effective shipping strategy also helps businesses optimize their supply chain management, reduce costs, and improve overall operational efficiency.
Why is shipping strategy important for your business?
When a new customer comes to your website and finds a product that he likes, adds it to his cart, and then goes to the checkout page and sees the shipping fees, one of two scenarios will happen:
Either he will think that the shipping fees are too expensive and decide not to continue shopping and abandon his cart, or he will decide to continue despite the increased cost.
However, most of the time, customers abandon their cart and decide to leave your website. According to research, shipping fees are one of the top reasons for high cart abandonment rate. As today’s average online shopping cart abandonment rate is roughly 70%. That is why shipping can’t be randomly put without any strategic planning.
Here are some benefits you can get from planning a well-crafted shipping strategy:
1. Enhanced customer experience:
When you transparently display your shipping strategy fees and the expected shipping days, you will enhance your customers’ experience as they will set their expectations accordingly. However, you need to be honest about shipping duration, and fees cause if they don’t find what you promised, you will lose them forever.
2. Increase your average order value (AOV):
Offers and promotions on shipping can encourage your customers to buy more from your website, which will increase your average order value. You could offer free shipping for a limited time, for example.
3. Expand your business:
If you plan well for an international shipping strategy, this will expand your business and widen your exposure to a great pool of customers in different countries.
4. Increase your conversion:
Customers tend to finalize their purchase when they have a clear understanding of what they’ll receive for a price they perceive as reasonable. Offering them choices further boosts the likelihood of a purchase. This might involve providing customers with options such as selecting their preferred carrier, delivery time, and even the way their order is fulfilled, which could include choices like home delivery or in-store pickup.
Now that we know the significance of shipping strategies, it’s time to learn some tips and some successful shipping strategies that will work for your business.
How to craft a successful shipping strategy?!
1. Free shipping strategy:
Companies with free shipping have a 20% higher conversion rate than those without this option. As free shipping strategy is pretty much considered the holy grail in the online commerce business. 93% of online shoppers would buy more products if free shipping was available. There are many ways you can apply free shipping to your business:
Free shipping on bundles:
A key aspect of making free shipping work well is making sure that the profit gained is more than what’s spent on delivery. One way to achieve this is by grouping items together and providing free shipping for these bundles. This approach helps retailers sell items that don’t sell quickly, ensuring they make money while also giving customers a great experience. It was found that 73% of people are more likely to decide to buy an item if it includes free shipping.
Limited-time free shipping:
Shoppers really enjoy purchasing discounted items. This is especially true for deals that have a limited time frame; the feeling of urgency affects how people buy things. When free shipping is available for only a specific period, customers tend to spend more and purchase additional products.
Minimum spend:
Offering free shipping on a minimum spend is helpful for your business as it guarantees a certain amount of profit. Users usually try to reach the minimum spend to be eligible for free shipping, as they find it more convenient; it was found that 24% of consumers would spend more to qualify for free shipping. So, offering free shipping when customers reach a certain spend amount would be a smart move for your business and will make it more convenient for your shoppers.
Free in-store pickup:
If you have many physical stores, providing free in-store pickup can be advantageous for both you and your customers. Customers can avoid waiting for deliveries and the associated costs. At the same time, your online business can avoid the added burden of handling one more package. This strategy makes the customers’ shopping experience more convenient.
As It was found that 83% of consumers say convenience while shopping is more important now. Furthermore, 52% say that half or more of their purchases are influenced by convenience.
2. Same-day delivery:
If you are doing local business, then this strategy might be a perk for you! Providing your customers with same-day delivery among your shipping options will increase your conversion rate cause it will make you stand out from the crowd. The higher conversions and the reputation you’ll build with same-day options could very well lead to increased revenue.
However, this will require some successful logistics from your end. If this is hard to achieve for you, you can use two-day shipping or next-day delivery instead.
3. Flat rate and Table rate shipping:
Using a flat or table rate can be a customer-friendly alternative to the challenges of offering free shipping. For instance, in flat-rate shipping, a fixed fee (X) is charged for shipping, regardless of what the customer buys or the order’s total value. In comparison, Table rate shipping is a more detailed version of this approach. For example, a seller with a warehouse in a certain City might charge a set rate for nearby customers, increasing the cost as the distance grows.
Another method involves setting rates according to the order subtotal, like charging $10 for orders up to $50, $5 for orders between $50 and $100, and free shipping for orders over $100. These rates could also be organized based on product categories or order weight. The best approach for your business can be determined through calculations and testing, to find what works well for your business and is also appreciated by your customers.
4. Take care of your return policy, and it’s shipping cost!
If you don’t allow for returns, you need to rethink this option again, and if you already have a return policy, you need to revamp it to ensure more customer loyalty and conversion rate. It was found that more than 90% of customers decide to buy again because of a store’s return policy. In addition, About 60% of shoppers check the return policy before they shop, making it crucial to create a positive first impression.
An excellent online return policy must be easy to understand, simple for customers to initiate a return, and offer various choices such as a full refund, store credit, or exchange the item for a different size or style. Also, you need to explain the return policy, shipping fees, and the duration it will take.
5. Shipping package:
It would be pleasant and beneficial for you to personalize your package. Consumers now expect a more personalized experience. You can easily do this by leaving a personal note, special packaging, or some samples or freebies. This can help create word of mouth and build awareness on social media and other channels. This is actually how you can help to create ambassadors out of your customers.
Check other e-commerce articles:
E-commerce Traffic sources are not a big mystery anymore with this guide!
Why can Coupons be valuable for e-commerce business?
Wrap up
Picking a shipping strategy that goes well with your business goals and resonates with your customers is important for your business success and equally crucial as planning your marketing strategy.
You can mix any of those strategies according to your own goals and holistic view to increase your conversion rate and improve your customer experience and loyalty.
