As often as not, it's cheaper to buy an item and pay shipping from one source than to buy the same item with free shipping from another source.
Funny how that works eh? ;)
How does most Free Shipping work? You calculate the cost from your zone to the furthest zone, correct? I've found that method to be full of holes especially if the majority of your business is only one or two zones away and not five or six as originally calculated.
That's great for you the Merchant as you are most likely making a profit on shipping. In my mind, shipping should be a 1:1 cost to the client, no markup involved, it's already expensive as it is.
Then you get the Shipping and Handling method. Take your maximum cost from one zone to the furthest, then add another $5.00 or $10.00 to cover Handling. Of course these costs show as Shipping and Handling on your invoice.
I don't know about you, but for the majority of my clients, Free Shipping just chews into already rock bottom profits due to the competitive nature of online pricing. Many of you talk about the consumer as if they are clueless, they are not. There are all sorts of buyer types and we know price is the driving factor in most online purchases. But, there are many other ways to skin that cat, at least I think so anyway.
My perspective is I don't mind paying a little more for the product if the item is shipping from a West Coast warehouse, usually in California or Nevada. That means your overall shipping costs are going to be minimal out of the gate and the product is most likely going to arrive a little faster than if it were shipped from the East Coast. Ya, I know, that pretty much leaves all this Free Shipping up to the BIG Boys.
I remember one instance where we even went as far as producing a table showing the competitor's pricing after all their offers were calculated. In the first column showed my client's discounted pricing plus estimated shipping costs, a no dicker sticker type thing. In many instances, we were the best price overall. Unfortunately there may have been a few items that were a little bit higher but hey, you cannot please everyone!
I really don't think you can survive giving away the farm. I mean, if you're operating at a minimal profit margin now due to the already competitive nature of your products, offering anything for free is only going to eat into that remaining profit. Unless of course you have VOLUME like Zappos, that's another case study in itself. They're getting discounts from the providers that are not available to you and I, the Small to Medium Business.
Bottom line? In today's changing economy, and with the challenges in energy costs, business is going to go local or to those who have product in warehouses that are in close proximity to the customer. It has to. There's nothing free about shipping a product from New York to California when it is available here for a few dollars more. There are all sorts of costs involved in that transaction and I don't see that business model surviving much longer.
Okay, rant over. Smacks self upside head! I HATE FREE SHIPPING! It has been the bane of our development time. All sorts of logic is required to deal with the myriad of Free Shipping options, features, etc.
