Amazon are encouraging retailers to offer free shipping as they say it leads to a significant increase to sell through rates, even if prices are higher to account for shipping costs.
Customers love free shipping and are more likely to choose products with free shipping than those that require additional shipping costs. Offering free shipping typically leads up to 12.4% sales uplift and can increase the chances of becoming the Featured Offer.
If you’re unsure where to start, choose products with higher prices that are an easier starting point where the shipping costs make up a smaller share of the total price and pricing calculations are simpler. You can also change your products to a free shipping template for a few weeks and test the results.
– Amazon
Amazon’s numbers are an average based on a 2020 Study of sales uplift of Free Shipping offers compared to identical offers with paid shipping but the same total landed price (item price + shipping fee). The study included United Kingdom/Germany/France/Italy/Spain stores. Specific ASIN uplift may vary and categories will definitely see differing results so some A-B testing is recommended to assess the impact for your particular product set.
How to manage free shipping on Amazon
- How to sign up for free shipping There is no sign-up involved. To offer free shipping on your products, go to Shipping settings and set your delivery rates to £0.00.
- Figure out your average shipping cost. What percentage of your sales are going to each region of the country? Check your carriers delivery rates and the average size of your orders (units per order) for each of these regions to calculate your average cost “per unit”.
- Not sure? Test with some of your selection. You must assign your SKUs to separate shipping templates.
- Low risk: If the test doesn’t work as expected, you can reset your shipping settings.
