In an Amazon World, Charging High Shipping Prices Is a No-No
As a company that works with small businesses, when we are building out eCommerce solutions one of the sticking points tends to be shipping price. Even if the company’s price is lower than it is on Amazon, if you’re using UPS or other expensive shipping methods, the total price ends up being far more expensive.
Consider this: most people these days tend to utilize amazon.com as well as other online purchasing solutions. So, they have gotten used to free shipping. So when you are building a website you really need to consider your shipping costs.
A FuturePay survey found that 86% of people abandon their shopping cart because of the cost of shipping.
Here are some of my recommendations for shipping:
1) Build In Shipping Costs: Depending on the price of the item you are selling, one good way to go it is to build the shipping cost into the price of the product, and then you can advertise free shipping. After all, this is basically what Amazon does, they charge a fee for prime but then they figure shipping as a cost of doing business. While you may not be as big as amazon.com, you can still build in shipping costs. So say you’re selling a big-ticket item say $ 3000 and the cost to you to ship it might be $ 100-$ 200. Just sell the item for $ 3200. Your buyers will be happy, as they will be supporting a small business, but still not paying exorbitant shipping prices. Remember: a lot of this is psychological. When someone sees the added shipping at the end of the transaction, it scares them off and they head back to Amazon to get their “free” shipping. Amazon doesn’t make money in shipping and in fact, they lose, but as I said it is a cost of doing business and because of their volume they obviously get better rates from shippers.
Pro tip: make sure before you put something on your website that you do searches and make sure your price is competitive. Otherwise, you’re not going to get many sales online.
2) Flat Rate Shipping: Another thing I like to recommend clients to do is charge a flat rate shipping charge. That way you can use the most cost-effective method for shipping items. Sometimes it might be the US Postal Service, sometimes it may be FedEx, and sometimes it might be UPS or freight companies. Then just charge a reasonable flat rate you can pick the most economical method.
3) Free Pickup and Delivery: Depending on your business if a lot of your sales are local, another good thing to offer is free pick up and delivery for Local ZIP Codes.
Some things aren’t meant to sell on the web
If you have very heavy items, it is very hard to sell those items online. Sometimes the cost of shipping can be as much or more than the product price. These types of items tend to sell better as local pick items and/or for free local delivery if you have the capability.
As I said, we are living in an Amazon world, so you can’t get away with charging those high shipping prices. Unfortunately, some e-commerce companies still don’t understand this. As I said above, I always tell my clients to do searches on the items you are selling and don’t bother to sell something with your price point is so much higher than your competitors or on Amazon. You may have loyal customers who will stick with you even if your price is a bit higher. But the general public is searching for the best price, and shipping is a big part of that.