Price Cut Profit: Is Free Shipping Really Free?
Let’s consider such an issue as FREE Shipping. Sooner or later each seller faces this phenomenon. It is not a phenomenon, actually, just one of the sides of the transportation and delivery “coin.” You would think (I mean that you think like a seller) that if you write “FREE shipping” on your web-page, dozens of new customers will immediately come there and buy more goods thus making you a millionaire.
Well, to some extent it is correct. Each visitor is looking to buy items at the lowest prices imaginable. If he sees the motto “FREE shipping” he thinks that the purchase will deprive him of less money. But what does the customer do next? Customers are not blind, dumb or lazy. They will most definitely check the competitors! They are likely to look for different variants and find the cheapest or the most convenient for them. What really matter is the FINAL cost of the product, but not the offer to ship the item for free.
So, let’s find out whether your price will be the lowest. If the customer doesn’t pay for shipping, then someone else has to. And who can possibly be this someone? I don’t see any other answer but the SELLER, which in this case is personified by YOU. So if there is Free shipping, you pay for it and thus you include the cost of shipping into the price of the product! What does it lead to?
Believe me, sooner of later the customer will find out that the price of your product is higher than that of your competitor and do you really think that he will buy your product only because you ship it for free? In fact he can, but in reality it turns out that customers buy the product from the place they checks the last.
And now let’s trace the sequence of his visits. If the customer sees that you deliver products to his porch absolutely free, he goes to your site first. Then he wants to check prices and goes to your competitors’ sites. He realizes that the cost is the same, but at the moment he is on the site of one of your competitors, so he buys the product from it. Not a good thing to hear, isn’t it?
So instead of wasting time and effort on some vague scheme of attracting customers, try to focus on finding good and reliable product suppliers and creating a fast and user-oriented web-page with good customer service.