Free delivery

'Free shipping' with conditions is cited as their most successful marketing tool by more than half of the booming US online retailing sector.

by Knowledge@Wharton
Last Updated: 23 Jul 2013

By contrast, shipping and handling costs are said to trigger more than half of abandoned online shopping carts. It is argued that the attraction of free shipping offers may lie in appearing to make the online transaction more comparable with that at the neighbourhood store. (To make a proper comparison, shoppers should also build in their time and travel costs, which many may not and which would further favour the online option).

For online retailers, free shipping at a certain threshold can increase customer spend or reduce handling costs by encouraging bundling of purchases.

In contrast, retailers that want to sell advertisements on their site can use a low free shipping threshold to encourage more regular customer visits.

How the offer of free shipping affects online shopping
Knowledge@Wharton, 19 April 2006

Review by Steve Lodge.

Knowledge@Wharton recommends

To read original article click here

Read more

Find this article useful?

Get more great articles like this in your inbox every lunchtime

There's opportunity in this recession

A Schumpeterian view of closing businesses.

Is it okay to spy on my staff if I think they're slacking ...

Everything you wanted to know about employee surveillance but were afraid to ask.

The psychology of remote working

In depth: The lockdown has proven that we can make working from home work, but...

A simple cure for impostor syndrome

Opinion: It's time to stop hero-worshipping and start figuring out what greatness looks like to...

I was hired to fix Uber’s toxic culture - and I did. Here’s ...

Harvard’s Frances Frei reveals how you know when your values have gone rotten, and what...

Social responsibility may no longer be a choice

Editorial: Having securitised businesses’ loans and paid their wage bills, it’s not inconceivable the government...