Smart Shipping: Using Shipping & Packing Strategies To Market Your Brand
These days, Amazon Prime rules the land of shipping, and it can be difficult for smaller merchants to impress customers. Modern customers expect their purchases to arrive quickly and without any extra expense. What’s more, they expect to be able to track shipments from the second they ship until the moment they arrive at their doorstep.
For many online sellers, all of these expectations can be overwhelming. Shipping is a complex (and expensive!) aspect of online selling, and it takes time and effort to find affordable shipping options and create a streamlined shipping process. For small businesses, in particular, it can be difficult to meet customers’ expectations for shipping speeds and costs while still maintaining a good profit margin.
Fortunately, with the right techniques, you can create a shipping strategy that works for your business and doesn’t scare customers away. In this article, we’ll present a few ways you can optimize your shipping strategy to encourage more sales while preserving your profit margins.
Keep reading to learn more about shipping best practices.
Smart Shipping & Packing Strategies
Using the right shipping and packing strategies can keep your business competitive. Predictable shipping strategies, such as flat-rate shipping and clear return policies, help keep customers on your site. Using marketing inserts and other packing strategies can direct customers back to your store. Let’s look at a few techniques you can implement today.
The most important advice I can offer is to be upfront with your customers about shipping costs. According to one study by the Baymard Institute, unexpected shipping rates are one of the main reasons for cart abandonment. Fifty percent of study participants who had abandoned an online sale in the last three months (and who were not “just browsing”) did so because extra costs (such as shipping, taxes, and fees) were too high. Additionally, 18% of respondents had abandoned a sale because they couldn’t calculate the total order cost upfront.
Reduce abandoned carts by minimizing that sticker shock. Include details about your shipping policies on every product page, and feature a shipping calculator in your customer’s shopping cart. Give customers plenty of opportunities to see shipping rates before they proceed to checkout.
Give Shipping Options
Every customer wants options, and this rule applies to methods of shipping as well. According to the 2018 State of eCommerce Delivery Report from Metapack, 54% of consumers expect the ability to select which shipping carrier delivers their order.
Even if you can only provide one shipping carrier (for example, you only ship with USPS), you can still give your customers options. When customers arrive at checkout, make sure you provide them with multiple shipping speeds to choose from. List a standard shipping rate, a first-class shipping rate, and an expedited shipping rate. That will give customers a sense of control and meet their expectations of what an online store should offer.
Offer Free Shipping
Free shipping is widely discussed and debated across eCommerce forums. One fact is certain: Customers have come to expect free shipping. Metapack’s 2018 State of eCommerce Delivery Report confirms this, showing that 62% of study participants expect free shipping on everyday purchases.
However, this push for free shipping can often be too much for smaller merchants. After all, “free” shipping is not actually free, and offering such a bargain can seriously eat into your profits.
Fortunately, universal free shipping is not the only way to go about setting lower shipping rates. Here are a few alternative free shipping models you might want to try instead:
- Set Minimum Limits: Setting a minimum limit is one of the most popular free shipping techniques in the industry. Provide free shipping to customers who spend over a set amount ($35, $50, $100, etc.). The amount you set will depend on the average price of your products and your average order totals. It’s a good idea to set your minimum limit slightly over your average order total. That will encourage customers to spend a few dollars more on your site while still providing a free shipping option. You might even consider adding a few cheaper “add-on items” to help customers reach those purchase limits.
- Offer Free Shipping To Specific Customer Groups: Another option is to offer free shipping to a specific customer group via a promo code. You could send out these discounts to your most loyal customers or to customers who have recently joined your email list. With any luck, your exclusive offer of free shipping will inspire repeat purchases.
Set Flat-Rate Shipping
If you can’t afford to offer free shipping very frequently, you might look into setting up a flat-rate shipping option.
Flat-rate shipping takes the guesswork out of shipping costs. It allows you to charge the same shipping rate for all of your items, so shipping expenses are never a surprise.
Flat-rate shipping works best for merchants who sell products of roughly the same size and weight (shoes or clothing, for example). Merchants who sell products that vary widely in size will not benefit from flat-rate shipping.
There are a couple of ways you can go about calculating your flat rate. The first method is simply to calculate the average expense of shipping your products. Let that average be your flat rate. You’ll lose money on some orders and gain money on others, and it should all average out in the end.
Integrate With Carriers For Real-Time Shipping Rates
When setting shipping prices, your final option is to simply charge your customers the amount that it costs you to ship your products. Integrate directly with shipping carriers or shipping software to give customers real-time, accurate shipping estimates. Customers then pay the entire cost of their shipments. As you might imagine, this strategy is not nearly as popular among customers as free shipping is; however, it is the only way you can 100% guarantee your shipping expenses will be covered.
If you choose to go this route, you should consider using a shipping software for your calculations. As you likely know, there are a lot of variables that go into determining shipping rates (just take a look at one of USPS’s rates tables). Shipping software will allow you to compare shipping rates from multiple carriers quickly. All you have to do is make sure you’ve entered all of your products’ weights and dimensions in your eCommerce platform’s admin. Your shipping software will take things from there.
To learn about top shipping software options, read our article on The Best Shipping Software.
Be Clear About Return Policies
Online shoppers are incredibly wary. They’re concerned that they may not like your products in-person and that the clothing items might not fit. These fears often keep customers from making a purchase online. In fact, according to research from the Baymard Institute, 10% of survey participants who had abandoned an online sale in the past three months left because the site’s return policy wasn’t satisfactory.
One of the best ways you can encourage more sales on your online store is to offer free returns. Free returns (and even free return shipping) eliminates the fears that customers have about products not meeting their expectations. This is especially important if you sell clothing or anything else with a fit. A free returns policy gives customers the ease of mind they need to complete a purchase.
You should, of course, attempt to minimize your return rates in every way possible. Include high-quality product images and product descriptions to give your customers an accurate depiction of your merchandise. Provide size charts for clothes and shoes, and let customers leave reviews and pictures of your products. Following all of these tips will help reduce the number of returns you have to process.
Include Marketing Materials In Packages
The packaging is an excellent opportunity to further your brand. Don’t forget to include your company logo on packing slips and other inserts. If you have the resources for it, think about investing in branded boxes to set your company apart from big marketplace sellers.
Consider including coupons and product announcements in your shipments as well. You don’t want to overwhelm your customers with too much marketing material, but no one objects to a coupon for their next purchase!
Finally, add a personal touch to your inserts. Address your customers by name, and think about including hand-written thank you notes in your shipments. That will help your customers establish an emotional connection with your store.
Use Sustainable Packaging
Consumers are becoming increasingly environmentally responsible, and they expect your business to be the same. According to a Neilson survey in 2018, 81% of global respondents feel strongly that companies should help improve the environment. While you may not be able to take on any environmental campaigns right now, you can make a small difference by reducing the negative impact that packaging has on the environment. Here are a few ways to start:
- Use The Smallest Boxes Possible: Using small boxes and envelopes for your shipments has a number of benefits. First, it’s less expensive to ship because it’s smaller. Second, smaller boxes take up less space in trucks and therefore are transported with less fuel. And third, smaller boxes use less cardboard and filler materials, creating less waste. Always look for the smallest package to fit your items!
- Use Recycled Materials: Look into using recycled cardboard and plastics for your packaging. Sites such as EcoEnclose have plenty of options available.
- Use Less Plastic: Aim to reduce the amount of plastic you use in packages. That means cutting down on the packaging for your products and avoiding bubble wrap as a filler material. One alternative you might consider is using air pillows instead of bubble wrap. While air pillows are still formed with plastic, they use less plastic than bubble wrap. A more eco-friendly alternative is filler paper, which you can find in large sheets and small shreds.
Implementing Shipping Strategies For Your Business
Many businesses use a variety of shipping strategies in their fulfillment processes. You may find that you benefit most from a combination of free shipping and flat-rate shipping. Or you may offer tiered flat-rate shipping, depending on the weight of your products. Consider your current shipping practices and expenses as you decide which route to take.
Remember, the best practices are to be clear about your shipping rates with customers and to keep those rates simple. Straightforward shipping rates will keep your customers happy, boosting your sales and customer loyalty.
Simpler shipping can also be a great benefit to your business. Take a look at our next article to learn how to simplify your shipping even further by outsourcing the whole process. Just click the link below.
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