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Free Shipping Versus $2.99? Even Small Shipping Costs Decrease Customers’ Interest Drastically

December 03, 2019

A new survey from Clutch highlights how even small shipping costs can strongly impact online shoppers’ interest in a product compared to free shipping. A similar number of online shoppers expect free shipping for both small items, such as clothing, and large items, such as furniture.

WASHINGTON, DC – December 3, 2019 – More than three-quarters of online shoppers (77%) say they are very interested in a product when the shipping is free, compared to only 43% who say the same for an item with $2.99 shipping. That means businesses could lose more than one-third of customers due to a $2.99 difference in price.Graph - Shipping Cost and Consumer Interest

The data comes from a new survey report by Clutch, the leading B2B ratings and reviews platform, on how much online shoppers expect to pay for shipping.

One-fifth of online shoppers (21%) say they’re very interested in a product if the shipping cost is $5.99, and only 13% say the same for an $8.99 shipping cost.

One simple solution small business owners recommend is to add shipping costs into products’ prices. A higher baseline price may be more appealing to some customers than a cheaper item that requires an extra fee. 

The appeal of free shipping can be more about an aversion to paying extra fees than a desire to save a few dollars.

“I have always worked the shipping cost into my domestically sold items because when shoppers are browsing, they can see the full cost immediately,” said Etsy shop owner Stacy Case. “For me, there is nothing worse than finding a wonderful $6 item only to find out the shipping cost is outrageously high.”

Free Shipping on a Sofa? Shoppers Want It Even on Large Items.

Similar numbers of online shoppers expect free shipping for items of all sizes, from clothing to furniture.

Nearly one-third of online shoppers (32%) expect free shipping for small items, and 30% expect free shipping for large items.

It can be harder for a business to justify offering free shipping on a sofa than a T-shirt, but many online shoppers want both.

Free Shipping Is Expected Industry-Wide — Not Just on Amazon

Online shoppers’ desire for free shipping is often attributed to Amazon’s long-time push to make it standard for its own customers.

Since 2000, Amazon has experimented with offering free shipping for increasingly more items. Amazon’s shipping and fulfillment costs now equal a full quarter of its topline revenue.

Amazon offers free two-day shipping as part of its membership program, Amazon Prime. Clutch found that among Prime members and non-members, only slightly more Prime members expect free shipping.

More than one-third of Prime members (34%) expect free shipping for small items compared to 28% of non-members. Meanwhile, 32% of Amazon Prime members expect free shipping for large items, while 27% of non-members expect it.

The data confirms that free shipping is no longer an Amazon-specific trend but one that is expected across the e-commerce industry.

Clutch’s survey included 528 U.S. respondents who ordered an item online within the past six months.

Read the full report: https://clutch.co/logistics/resources/free-shipping-trends-statistics

For questions or comments, contact Riley Panko at [email protected]

About Clutch

Clutch is the leading ratings and reviews platform for IT, marketing, and business service providers. Each month, over half a million buyers and sellers of services use the Clutch platform, and the user base is growing over 50% a year. Clutch has been recognized by Inc. Magazine as one of the 500 fastest growing companies in the U.S. and has been listed as a top 50 startup by LinkedIn.

Contact

Riley Panko
[email protected]
(202) 899-2779