The phenomenon of shipping has seen an exponential rise ever since the inception of online purchasing. Although bearing the costs of (free) shipping for retailers is high, but they can’t simply overlook it as the cost of losing market share to the competitors is even higher.
It becomes important to quote one study published in Wall Street Journal by Deloitte online survey where the number of consumers who refused to pay anything extra for receiving their package next-day fell in the range of 22% -38%. Similarly, The numbers for customers who also declined to pay extra to receive shipment same day also increased from 24% to 32% in one year time (2015-16).
So what to do in that scenario where providing shipping eats into the profits and not doing it pulls them outside competition.
As they say, necessity is the mother of invention, the retailers have also figured out some smart ways of saving on shipping.
1. In-Store PickUp:
Store Pick up lets you buy products online and you can pick them up in a store. There is no shipping and delivery cost involved in this process and you get your ordered product in a shorter time window.
Among the most popular ways retailers save on shipping is In-Store Pickup. Almost all the major retailer and e-tailers are doing it – Amazon, Walmart, Jet, and Best Buy. Picking the parcels in-store enables retailers to save on shipping which they share with their customers.
2. Subscription charges:
It is the most popular strategy in today’s time. Now E-commerce Businesses like Amazon are giving the option to their customers for subscribing to their Prime membership programs for 1 year time period.
According to Statista, as of Sept. 2017 the last measured period, the source estimated 90 million Amazon Prime subscribers in the United States, up from 63 million in June during the previous year.
40 percent of consumers expect to access Amazon-prime style memberships in the next 1-3 years vs. 25 percent of retailers who plan to introduce these services in the same period.
Here are some of the reasons for users in the United States to join Amazon Prime:
3. Offer free shipping by Conditional and Unconditional tactics:
There are two ways you can offer free shipping; conditional and unconditional.
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Conditional Free Shipping sets conditions to your free dispatching offer, for example, minimum demand regard, select products, or economy delivery. For conditional free shipping, you can set a minimum order amount, offer free shipping on selected products only, offer free economy shipping etc.
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Unconditional Free Shipping applies free shipping to each product and each request no matter how you look at it. The question is when you offer unconditional free shipping? Here are some reasons:
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When all of your competitors are offering free shipping without any condition.
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When none of your competitors offering free shipping, then doing so can make your website stand out.
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When you want to reduce the customer issues.
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And the last is when you are selling niche products that have high margin and they are easy to ship.
4. Employ Multiple Carriers Shipping Software:
As the e-commerce industry revenue is increasing their efforts to satisfy their customers are also increasing. One of the aspect to satisfy customers are shipping.
Shipping nowadays is the core component of any e-commerce company’s business strategy. Multi-carrier shipping software helps in streamlining and automating the shipping process.
An effective order fulfillment process is the way to customer satisfaction and expanded sales. To put it plainly, organizations need to ensure they are preparing and satisfying requests precisely, rapidly and effectively, without burning up all available resources. One approach to augment returns and limit costs is by actualizing multi-carrier shipping programming. Some examples are FedEx, USPS, UPS.
5. Zone Skipping:
Zone Skipping is a logistics tactic whereby a shipper merges numerous individual bundles or orders. These individual packages are held and accumulated until the point when the amount reaches a full truckload (now and again LTL works, as well). These packets are sent in mass from one region, similar to the East, to another region, similar to the West. Upon landing in an sorting office, the packages finish their adventure to the last goal.
It is advantageous for your business when you lower the per package price for shipping. Instead of shipping products individually across different zones, Ship packages in bulk in different time zones. It can also be easy for you to do the calculation when you are shipping products in bulk.
6. Offer Flat Rate Shipping:
It means a uniform shipping rate that is applicable for a wide range of delivery boxes and bundles, regardless of the weight, size and different measurements.
In flat rate shipping, it just implies that you can deliver anything at the same cost. In most of the cases, the previous is figured and set by the e-commerce website itself, while in case of the latter, 3rd party logistics organizations decide the shipping rates.
Flat rate shipping is easy to understand and there is more transparency in this type of shipping. Buyers see the shipping price of any product mentioned on the e-commerce websites. By seeing shipping price Buyers know what they’re getting into. It’s easy for the customers to do the calculations after seeing the shipping cost. If you display the shipping price to the buyers on your website, customers will feel satisfied and it will lead to fewer cart abandonment.
7. Get your Shipping label on the web:
Getting your shipping labels online instead of at the postal services saves a lot of money. To include shipping confirmation with your online purchase it is less expensive than purchasing at the counter.
USPS now enables you to plan a pick up at your preferred area, which means you don’t have to go to post office every time. Simply print your label through your online supplier, I may prefer Paypal, bundle your requests and schedule the pick up from your shop. It saves your time and money both.
Apart from it, common sense should also prevail such as negotiation with multiple carriers, sending through freight, also ensure the accuracy with weight and description details. This also helps reduce shipping costs which can be a make-or-break factor in the cut-throat competition.
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