In e-commerce, winning over consumers is a constant challenge. With a competitive market and customers increasingly aware of offers and benefits, strategies such as free shipping and discounts have become essential to increase sales and build customer loyalty. But which of these options works best? The answer is not simple and depends on a number of factors. In this article, we explore the advantages, disadvantages and how to choose the best strategy for your online store.
The Importance of Value Perception
Before discussing the strategies, it is important to understand that both free shipping and discounts are directly linked to the customer’s recent mobile phone number data perception of value. Consumers do not buy based solely on price, but on the perception that they are getting a good deal. Therefore, the way you communicate these advantages is as crucial as the strategy you choose.
Free Shipping: Advantages and Disadvantages
Advantages :
- Reduce Cart Abandonment Rate: Studies show that shipping costs are one of the main reasons for shopping cart abandonment.
- Increase in Average Purchase: Offering free put your findings into practice shipping on purchases above a minimum amount encourages customers to add more items to their cart.
- Simplicity: The promise of “free shipping” is direct and attractive, making it easier for the consumer to make a decision.
Disadvantages :
- High Cost: Depending on the customer’s location, shipping costs can significantly impact profit margins.
- Permanent Expectation: Once you start offering free shipping, customers may expect it to become the norm.
- Logistics Challenges: Integrating free shipping into orders can be complex, especially for smaller retailers.
Discount: Advantages and Disadvantages
Advantages:
- Immediate Attraction: Discounts generate an emotional appeal, creating a sense of urgency to purchase.
- Flexibility: You can apply discounts turkey numbers database to specific products, categories or the cart total, depending on your strategy.
- Ease of Implementation: Setting up discount codes is straightforward on most e-commerce platforms.
Disadvantages:
- Reduction in Profit Margin: Applying frequent discounts can compromise the profitability of the business.
- Promotional Dependence: Customers may get used to waiting for discounts to make purchases.
- Impact on Value Perception: Frequent discounts can devalue the brand or products.
What Does the Research Say?
According to research conducted by the Baymard Institute, around 50% of consumers abandon shopping carts due to unexpected extra costs , such as shipping. On the other hand, research from Shopify reveals that discounts are the most influential factor for 60% of consumers when deciding where to buy online.
When to Choose Free Shipping?
Free shipping is most effective when:
- Low Value Products: When shipping costs represent a significant proportion of the total order value.
- Price-Sensitive Target Audience: Consumers looking for value for money tend to value free shipping more.
- Low Average Ticket: Encouraging larger orders with free shipping conditions can be an effective strategy.
When to Choose a Discount?
Discounts work best in situations like:
- Niche Stores: Where the perception of exclusivity can be maintained with well-planned discounts.
- High Margin Products: Where there is room to apply discounts without compromising profitability.
- Temporary Promotions: Commemorative dates and short-term campaigns are perfect for discounts.
How to Decide? A/B Testing is the Answer
One of the best ways to find out what works for your store is to run A/B tests. Offer free shipping to some of your customers and discounts to others, comparing conversion rates, average ticket, and profit margins. Tools like Google Optimize or native features of platforms like Shopify and WooCommerce make these experiments easier.
How to Communicate These Advantages
Regardless of the strategy you choose, it is crucial to communicate the benefits clearly and attractively:
- Use Website Highlights: Banners with messages like “Free Shipping on Orders Over $100” or “10% Off Your First Purchase” grab attention immediately.
- Email Marketing: Send targeted campaigns informing about promotions.
- Social Media: Take advantage of Instagram and TikTok to showcase benefits in a visual and engaging way.
- Dedicated Landing Pages: Create specific pages for promotions, with details about conditions and deadlines.
