A decade ago I working as the Director of E-Commerce for a footwear manufacturer in Franklin. We were a 100-plus year old company that sold primarily to retailers or direct in to industries where safety footwear was required. I was hired to start up a direct-to-consumer business for this $150 million company.
At that point in time, footwear web sites were some of the few places online that were offering free shipping (and most–including us–offered free returns as well). This practice was a nod to the fact that shoes and boots from different labels fit differently and we wanted to encourage shoppers to try on our products.
Remember, at that point in time online retailers were using excessive shipping charges to pad their margin numbers so that they could advertise lower prices than their bricks-and-mortar brethren were offering offline. Over time, however, this practice began to change to the point where, today, almost half of all online orders now include free shipping.
For many consumers, shipping chargers were a barrier that kept them from purchasing online unless the price differentials were large enough to make up the cost. As this wall continues crumble, it’s no wonder that online retailers such as Amazon continue to consume more of our spending.
One of the drivers behind this is Amazon Prime where users pay a flat annual fee to access free two-day shipping and discounted overnight shipping. As a Prime customer, I can tell you that my shopping habits have been changed by the fact that shipping costs are no longer a consideration.
How about you?
UPDATE: The walls continue to crumble. “Amazon’s Endless.com Debuts Free International Shipping To 50+ Countries“.
