Inmar Intelligence, a data-driven technology-enabled services company, today revealed findings on e-commerce consumer insights, including what shoppers would give up just to get free shipping on their purchase. In a survey of over 1,000 U.S. consumers, Inmar Intelligence uncovered the power of free shipping and offers guidance for retailers and marketers on the importance of shipping costs in relation to consumers buying more.
With the rollout of vaccines and the world beginning to open up, people who have been stuck at home for over a year will be anxious to get out and shop in-person if given the choice. Shopping in person not only gets people out and about, but saves on shipping. But what if most online stores offered free shipping, is there more incentive to continue online shopping at home?
According to Inmar Intelligence’s survey, 78 percent of consumers are willing to buy more just to get free shipping, and that a majority don’t mind waiting a few extra days to receive their items if free shipping is an option. The data also showed the lengths consumers would go to receive free shipping, like picking up their order at a nearby grocery store, pharmacy or Amazon locker-like setting.
Although consumers prefer free shipping to receive their orders, they do not want to pay to ship them back. Sixty-two percent of respondents said that they are not willing to pay for the shipping and handling of returns, but of those who would pay for a return, 64 percent would pay less than $10.
The most enlightening findings from the survey include:
• 52 percent are willing to spend $25 – $50 in a single transaction if it means they will receive free shipping
• 85 percent of shoppers would be willing to pick up their packages at a local grocery store or pharmacy if it saved them the cost of shipping
• 79 percent of shoppers expect free shipping when ordering apparel and home goods online
• 87 percent don’t mind waiting longer (5-7 days) to receive their purchase if it means they get free shipping, despite 48 percent who expect deliveries to arrive in 2-3 days
• Of those shoppers who are willing to pay for shipping and handling for returns, 30 percent would be willing to pay less than $5 for a return and 34 percent would pay between $5 – $10
“Over the past year, consumer behaviors and expectations when it comes to e-commerce have clearly shifted,” said Ken Bays, Vice President of Product Development at Inmar Intelligence. “Consumers have an expectation of free shipping, but what’s surprising is the methods they’ll accept to receive that incentive. From the retailers’ perspective, consumers are willing to provide their own last mile, which allows retailers to come up with creative alternatives for fulfillment and reduce, sometimes remove, last-mile costs. It is a trend that is here to stay, and one that could be beneficial for all.”
In an exclusive interview with SCMR, Bays said there were some surprises contained in the research:
The survey is clear that consumers still have an expectation of free delivery. However, there is a surprising response to the methods that consumers are willing to accept to get free delivery. Last mile is a serious cost driver for e-commerce retailers. Finding ways to reduce or remove the last mile cost is a #1 priority for industry. Our survey shows clearly that consumers are willing to help with that solution. While 79% still expect free delivery, 85% would be willing to use a pickup location (providing their own last mile) and 79% would be willing to comply with a minimum order size to qualify for free shipping. This clearly indicates that retailers can use some creative alternatives to simply making all shipments free.
About the Author
Patrick Burnson, Executive Editor
Mr. Burnson is a widely-published writer and editor specializing in international trade, global logistics, and supply chain management. He is based in San Francisco, where he provides a Pacific Rim perspective on industry trends and forecasts. He may be reached at his downtown office: [email protected]