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Mon Nov 28 2011 22:16:00

Will Online Merchants Face Free-Shipping Backlash?

By: Ina Steiner

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Small sellers often express frustration that their larger competitors are training consumers to expect free shipping on online purchases, especially around the holidays. They know they either have to eat the cost of offering free shipping, or increase the price of their products. Merchants know there's no such thing as "free" shipping.

Today, an article published by MSNBC took a critical look at free shipping offers and came to the same conclusion. Not only that, the article pointed to some cases in which consumers are spending more and experiencing longer delivery times thanks to free shipping offers, and pointed out the downsides of free shipping for consumers.

This kind of reporting educates consumers to think before blindly turning to a product just because of such offers, but could also lead to a backlash against merchants who offer free shipping.

Just how prevalent is free shipping? Many merchants make it conditional - you have to spend a certain amount in order to qualify for free shipping. A Stamps.com survey found that 68 percent of ecommerce sellers are planning to offer free shipping on more products during the 2011 holiday season, up from 53 percent in last year's holiday season, and many plan to participate in Free Shipping Day, which falls on December 16.

With a percentage-off limited-time sale or a coupon offer, merchants have more control over the costs and lengths of promotional pricing. But with free shipping, merchants are increasingly painting themselves into a corner where customers grow to expect it to be offered permanently.

We asked in September if you could afford to offer free shipping during the holiday season. How's it working out? Have you followed through or had second thoughts about offering it. And for those merchants who using free shipping as an incentive, is it having any impact on this year's sales?




Comments (29) | Permalink

Readers Comments

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: wooodjungle! on ebay

Tue Nov 29 00:29:48 2011

On Ebay, I try to cater to a specific clientel, i.e. buyers who don't nickel and dime me over shipping costs for one. That very much helps with avoiding bad feedback as well.  I have even gone so far as telling people not to bid on my items if they have issues with shipping costs. Up until recently, that was ok but now Ebay won't allow that verbage in listings. I  prefer the smart buyer who knows shipping is not free and has to be built in somewhere.

Personally, I would not be in a business where I had to constantly deal with nickel and dimers, overly picky or buyers that don't read.  My business model seems to work well in keeping those issues to a minimum.

I WILL NOT change my use of free shipping. I use it sparingly as it is not often needed.

It's just a marketing ploy, and that's all it will ever be. It may make sense for some products and business models, but not for me.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: Lashing back

Tue Nov 29 02:21:40 2011

Ebay is creating spoiled brat buyers where buyers have no accountability. JD is pushing hard free shipping, minimum 14 day returns, expedited 1-day shipping. Non-paying buyers, returns for any reason - all are welcome on eBay. Seller does everything right but buyers leave low DSRs - not a problem because this is only an opinion. Sellers opinion no longer matter.

In JD's world sellers are expendable. Doesn't matter if they have a family to feed, bills to pay or are living on the edge.

Offering free shipping on low dollar items does bring out the worst, headache producing buyers. I don't see how anyone can offer free shipping with the fees being so high. One day free listings with low sell-thru doesn't cut it with eBay's lack of visibility. The site gets hit with a saturation of auction listings and sellers get buried. Sure there is the carrot wagging of better visibility given if offering free shipping and a 20% discount on FVFs (TRS get an additional 20%). Has anyone noticed increased views, watchers or sales?

Ebay wants to be the only site to offer free shipping all the time with no minimum purchase. How long do you think buyers will come to eBay if all items are priced higher than other sites? Only big retailers will be able to keep up but it sure makes for a boring site where even more buyers will stay away.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: OverpayAndGetFreeShipping

Tue Nov 29 04:51:34 2011

The gullibility of the consumer is mind boggling, show them the word free and they will pay double to get the free part. Give them a 1 day deal and they are pepper spraying and fighting each other in the isles. Who needs customers like that? When you buy an item the seller must charge enough to cover all cost. Shipping is a cost.

The free shipping buyers are the same ones sitting at home falling hook line and sinker for the those infomercials ''Hey, wait. Order now and we will send a second one ABSOLUTELY free, just pay a separate processing and handling charge'' Some people don't read or can't comprehend what they do read, they are selfish and gullible. If you want to attract this type of customer word it right and you can sell them anything at any price. There is a tradeoff, a week later the complaints and returns start rolling in.

Shipping cost tell you a lot about the character and integrity of the seller. A customer oriented seller will try to keep your cost low with actual shipping charges. A greedy money grubber that doesn't care about the customer will pad the shipping cost and add handling charges to make a buck on everything. I would rather know what I am being charged for shipping so I can see if the seller is gouging me rather than have it secretly included with the price.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: OhForPetesSake

Tue Nov 29 05:21:21 2011

I'm a long time seller on Ebay.

Recently bought an item with 9.00 shipping which was fine with me.

Where the problem was is the seller wrapped the package in plain brown paper with no protection. Package was crushed. Also weight on package was 3 oz. Paypal shipping is 1.75.

I contacted seller. Response was the extra 7.25 was gas, time, tape, paper etc. If I didn't like it don't bid. This was from a TRS.

I could see a few bucks BUT....

Arrogance and stupidity got this seller a red donut and all 1's.
I don't even feel bad. Some sellers need to learn if you overcharge and get caught you get the donut. Enjoy it with your coffee and don't bother me with revisions. Ain't goin to happen.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: fvh

Tue Nov 29 08:30:38 2011

I like to use shipping as an incentive to get my customers to buy more than one item from me at a time. I sell light weight items, charge a reasonable shipping fee for the first item, and offer free shipping on most additional items purchased from me in one invoice. For heavier items, I combine shipping as best I can and charge as close to
actual cost as possible.

In this way, I feel I am offering VALUE to my customers. In turn, I usually attract customers who can recognize the difference between something that's a good value and something that's cheap; an offer that's sincere and one that doesn't truly exist-- Like free shipping.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: John

Tue Nov 29 09:18:21 2011

Poor policy, big profits, more investing will ultimately lead to Sh_t hitting the fan in such large proportions no one will be able to dig themselves out so in order to get used to the thought....Here is the parable of the non conforming sparrow ......

Once upon a time, there was a nonconforming sparrow who decided not to fly south for the winter. However, soon the weather turned so cold that he reluctantly started southward. In a short time, ice began to form on his wings and he fell to earth in a barnyard, almost frozen. A cow passed by and crapped on the little sparrow. The sparrow thought it was the end. But then the manure warmed him and defrosted his wings. Warm and happy, able to breathe, he started to sing. Just then a large cat came by and hearing the chirping, investigated the sounds. The cat cleared away the manure, found the chirping sparrow and promptly ate him.

THE MORAL OF THE STORY

1. Everyone who sh_ts on you is not necessarily your enemy.
2. Everyone who gets you out of sh_t is not necessarily your friend.
3. And, if you're warm and happy in a pile of sh_t, keep your mouth shut!

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: Tired of eBay's Bullsh*t This user has validated their user name.

Tue Nov 29 13:23:04 2011

I never do free shipping, and I don't think that I ever will. I do price shipping FAIRLY by making sure that the buyer pays the carrier charge or a few dollars less.

How?

If you know that actual boxed weight, enter a weight of a pound or two less for the eBay shipping-calc. Most of my items are 10+ pounds as packed, and most are over $250.

That means I need to send Signature Required per Paypal SP policy. UPS charges $4.25 for SR -- but the eBay ship-calc does not figure this into the amount charged the buyer.

The buyer gets shipping subsidized a little by me, and that is fine I think.

But no free shipping.

--

JD/eBay just do not know when to shut up.

I am also a buyer on eBay. And I can say that when eBay started requiring sellers to specify shipping cost ... well, that made it just so much easier to buy. No back and forth with seller in the hours before EOA, since shipping was clearly shown.

That was something GOOD that eBay did, but they should have stopped there.

But no, they have to try to force the Free Shipping morsel down our throats.

Don't much matter. I've been slowly moving away from eBay AND Paypal for a couple of years now, and plan to continue that trend. Google Checkout works great for me, BTW.

- Tired of eBay's Bullsh*t

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: Tired of eBay's Bullsh*t This user has validated their user name.

Tue Nov 29 13:26:30 2011

PS...

@MSMBC "Clearly, the free-shipping hype has intensified this holiday season..."

Such a big compensation package for JD, and for what? Going along with hype (instead of listening to your customers, aka Sellers).

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: John

Tue Nov 29 14:05:37 2011

I'm an Ebay seller
I don't offer FREE shipping because it's NOT free
I also don't have free shipping because Ebay will be sued over the FVF fee's on shipping and I want all that money back. If you offer so called free shipping you will never recover those costs.
Ebay will pay us back just as they did in the Ebay motors class action that was just paid out.
The check will be much larger this time around!

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: massachusetts howler

Tue Nov 29 14:43:07 2011

You will get NO REAL ADDED EXPOSURE with ''Free Shipping''!
It is all a LIE- sales DEPEND ON the amount of time your items are not in a black hole- I get about 12 hours of exposure on my items in any given week, free shipping or no free shipping so CHARGE FOR SHIPPING or JD will end up making FREE SHIPPING MANDATORY.
Don't do it!

Remember what JD SWORE in 2008:
''DSR's are just a TOOL to HELP sellers, they will NEVER BE USED AGAINST sellers''

JD is a LIAR, and the NUMBERS against Amazon will show that THIS SEASON.

He will do something DESPERATE that will HURT US ALL VERY SOON- MARK MY WORDS.
Mings Law APPLIES.

Howler

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: sally

Tue Nov 29 16:19:24 2011

We do offer free shipping. We ship lightweight office supplies and photo supplies. The free shipping, while I thought was silly at first, really did help sales. On the few items that I don't have listed for free ship, I get customers asking if I will ship it for free. Only twice, out of 5000 sales since last year did a customer ask for a "kickback" on a combined order because he knew we put the shipping in the selling price. However, we do not put the whole shipping cost into the price, we eat some a bit of it to be able to offer the lowest price and beat our competition and make it up in volume. It's been working for me, but I easily understand how it would not work with other products etc. We were lucky that going with the flow of consumer wants worked out for us, even if the consumer want is misguided.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

This user has validated their user name. by: Ming the Merciless

Tue Nov 29 17:27:57 2011

If there indeed is ONE thing all non Diamond sellers need to keep at the forefront of their minds is that nothing ebay says about the requirements needed for greater search exposure are truthful or accurate.

Howler is absolutely correct.

"Free" shipping, 14 day return time, TRS, 1 business day turnaround, DSRs, Powerseller status, feedback, or any combination or permutation of the above won't elevate or diminish a seller's search position worth mentioning if at all.

We've all seen thousands if not collectively hundreds of thousands of listings where items offered by non TRS sellers who don't accept returns, aren't offering "free shipping, have far less than perfect DSRs, and feedback under 99% show far higher in Best Match search when more than 24 hours remain in the listing.

This increased exposure or boost that ebay has promised is a complete illusory fraud designed to manipulate sellers into certain behaviors that profit ebay only which are cheered on by the Wall Street banksters.

"Boost" is just another in a series of thousands of lies ebay has told sellers since Pierre Omidyar spun the complete tale of the infamous Pez dispenser.

It's also a micocosm of corrupt corporate America and criminal financial industry that supports and enables deliberate mis and disinformation, the fascist government who works to benefit the criminal corporations/banksters instead of the people (the very definition of fascism) and therefore won't enforce the FTC regs against ebay, and the dumbing down of America most of whom apparently still hasn't figured who or what hijacked our value and stole their futures.

What ebay is doing is classic (and illegal) bait and switch. Selelrs are baited into offering terms favorable to ebay in exchange for ebay agreeing to give them a "boost" in search.

The switch part is that ebay defines "boost" in such a way that no real expanded exposure occurs.

Clear unequivocal consumer fraud.

In addition to the Diamonds, those who actually do get enhanced exposure sre those selling the most and cheapest, regardless of their shipping costs, return policy, TRS/Powersellers status, and so on.

It's the most massive, widespread consumer fraud in American history.

IT'S ALL LIES.


Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: NoFREEshipHere

Tue Nov 29 18:07:37 2011

I wish Ebay would call it for what it is "Includes shipping and handling" instead of free shipping. I still charge for most items and still have TRS status. I have a unique strategy that has been working since last holiday.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: MR ME

Tue Nov 29 20:19:42 2011

Nothing is being given away "free".
eBay makes its sellers jump through hoops so they can play "nice guy" and offer "free" shipping.
Calculated, honest shipping without the ebay "gouge" is a better deal for all.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: JES

Wed Nov 30 03:40:02 2011

First off ill keep this short unlike everyone else writing a book on here. You dont charge double when you charge free shipping, you just include the shipping price into the listing price on ebay so many do it now and if your not still making your profit margins its time to look for a new supplier. Ebay is now charging you fees including shipping cost but are offering discounts by using free shipping and shipping quick 20% off your fees so why complain 98% of my items include free shipping in my ebay store.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

This user has validated their user name. by: Bob

Wed Nov 30 09:06:20 2011

"Free Shipping" is just more of eBay's smoke & mirror B.S. just like their "Lowest fees ever" when they increased item FVF's. How about the positive spin eBay put on the shipping fee FVF when they introduced it: "We're rewarding sellers who offer reduced shipping"

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: Beth

Wed Nov 30 09:17:33 2011

The ability to even figure out what a reasonable amount to add to a item price to cover shipping becomes much harder when you live on one coast or the other. If you live in the middle of the US, you can pretty well figure what the average shipping cost will be. I live on East coast.  An item I can ship to NJ or PA for $6.00, will cost $12.00 to ship to CA or WA.  Do I add $12 to my item price and lose all the potential buyers on East coast who will find someone else selling it cheaper, or do I add $6.00 and hope I don't lose an additional $6.00 if bought by someone on West coast too many times. Or maybe I add $9.00 and HOPE it all works out in my favor. Nope, too many variables for me to be able to do it when most of my items sell for under $50.00. I can and do include shipping cost in item cost (what Ebay calls free shipping) if an item is being mailed first class, media mail or flat rate as I know what my shipping cost will be. I have no idea how to add shipping costs for other services unless I know the location of the future buyer. so far, I am not that psychic.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: Carol

Wed Nov 30 10:06:46 2011

How you personally feel about free shipping isn't very material if you sell on ebay.  Ebay gives sellers increased exposure in best match and automatic 5 stars in the shipping DSR if you offer it, so it's a no-brainer to me.

It's next to impossible to build free shipping into the price in auction format but easy to do for fixed price - one reason I don't do many auctions

I charge shipping on my own web site, but then I'm free to set all the rules there.  When selling on ebay, I have to adjust to their opinion on the subject - or spend a lot of energy railing against something I can't change.

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: DonC
Web Site

Wed Nov 30 10:07:42 2011

I don't bother listing many items at on-line auctions.

I offer free shipping on eBay occasionally  as a promotion. It does not seem to make much difference in sales. It appears that offering discounted shipping is more effective than free shipping on eBay.

At our on-line store we offer free shipping on orders paid with a USPS money order. I get few takers.

With our products in our market place free shipping doesn't seem to make much difference.

Don



 

Will Online Merchants Face Free-Shipping Backlash?   Will Online Merchants Face Free-Shipping Backlash?

by: MsQuezal

Wed Nov 30 10:10:35 2011

The "FREE SHIPPING" myth hurts us all. Last week i checked my DSR's to find that my "perfect 5's" had been damaged by someone who never left negative feedback, just a "1" star rating on shipping costs. I grabbed my post office receipts and checked every transaction for cost against what price i had listed in my auction.
Of the 20 auctions that sold 18 were right to the penny as advertised and 2 cost ME several dollars because i had undercharged the bidder. I checked every feedback to "read between the lines" to see if i sensed any dissatisfaction but every review was glowing. My point here is the one of two things happened.....either the bidder felt a sense of entitlement and should NOT be charging for shipping or it happened as a accident and was not meant to be left as a "1".
However, my perfect rating now in shreds and i have to worry about my TRS badge being taken away and losing the 20% discount.
So this has forced me to take a serious look at the situation. From now on, i will only ship items that are small and light, and that i can buy well enough (i sell antiques and vintage collectibles) to avoid losing profits buy picking up the shipping tab. That way these spoiled bidders can never leave me a low DSR again. Problem solved.....until the next JD idiotic idea throws a monkey wrench into the works. I am always waiting for the next shoe to drop!

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