How delivery effects your sales
There are many delivery options available, and with Christmas right around the corner, it's becoming increasingly more important to find the perfect option for you and your customers. In this blog post, we'll explore how different delivery options can affect your sales and how you can use them to optimize your business in the holiday season.
The first thing that comes to mind when thinking about delivery is speed, but what is it?
"A metric used to assess the ability of a business to fulfil shipping orders or other transactions within the period of time promised to a client or customer. ... Also called on-time delivery." - Business Directory
Most consumers will want their new purchase to come as soon as possible and will often pay more for faster delivery. This can be seen with the popularity of Amazon Prime and their guaranteed next day delivery on a lot of their products.
How does it affect your eCommerce sales?
- Today's consumers will expect online retailers to provide more convenient and more personalised delivery options.
- Research from Research Now for MetaPack shows that consumers won't hesitate to abandon their shopping carts if their desired delivery option is not available.
- After surveying 3000 adults, 66% said that they've brought goods from one business to another because their delivery options were more appealing.
- 49% of the 3000 said they'd be willing to pay more for a better or more convenient shipping option.
- 51% said they have abandoned shopping carts because they didn't like the delivery options on offer. (The order would take too long to fulfil or that the delivery could not be guaranteed by a certain date
- Fast delivery is a priority for 86% but 71% also said that they'd be willing to wait longer if the goods were less expensive
- of the 3000 surveyed, 64% of British respondents said that they'd buy from one retailer over another because they provided more delivery options
Another thing that comes to mind when thinking about delivery is the cost. When shipping is too expensive it causes abandoned carts, website bounces and a loss of sales. Many businesses use Free Shipping to combat this problem and as an additional selling point to buy from them.
"Free shipping is a marketing tactic used primarily by online vendors and mail-order catalogues as a sales strategy to attract customers." - Wikipedia
There are different versions of free shipping that many eCommerce businesses have implemented. For example,
- Pure Free Shipping, whereas a customer, anything you buy on the eCommerce store will be shipped to you for free. No catches or limitations.
- Member-only free shipping. Free shipping available to customers who join a membership
- Pay-wall free shipping. Customers will receive free shipping when they spend a certain amount of money on your eCommerce store.
- Selective free shipping. When customers will receive free shipping when they buy certain products.
- Timed free shipping. When customers receive free shipping if they check out in a certain period of time
Here are some statistics that show the effects free shipping can have on sales;
Stitch labs found that by offering free shipping, online retailers can boost their revenue by 10%
Free shipping boosts average order value. A study from comScore and UPS shows that 52% of American shoppers have added items to their basket so that they can qualify for the free shipping.
How businesses on KhooSeller have used Free Shipping
Emma Jayne Handmade offer Paywall free shipping on all orders over £25. We looked at their order statistics for 2017 and we can see that 33.6% of orders qualified for free shipping, that's a whole 1/3 of sales! with 16% of the orders between £25 and £30. This shows just how effective paywall free shipping can be.
Jane Abbott is another eCommerce website that uses KhooSeller. They offer their customers free UK delivery using Pay-wall free shipping on orders over £60. When we look at their orders we can see that 13.9% of them were over £60 and were orders of multiple products. We can conclude from this (even with a somewhat large pay-wall) that customers will be willing to add more products to their order to qualify for free shipping.
Having a good returns policy is a part of your delivery strategy. It's very important.
"Return policies are the rules retail merchants establish to manage the process by which customers return or exchange unwanted or defective merchandise" - USLegalDefinitions
Right to a 30-day refund is UK law. sometimes eCommerce businesses will give their customers different returns policies to make their product more appealing.