Free Shipping To Drive Online Holiday Sales

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Expect to see plenty of free shipping offers this holiday season, the most common shipping promotion will be free shipping with conditions, according to the 2007 eHoliday study conducted by BizRate Research for Shop.org and Shopzilla.

Sixty percent of retailers will use free shipping upgrades, 53 percent will offer discounted shipping and 41 percent will offer free shipping without conditions to increase sales. Consumers like free shipping promotions and 61 percent of online shoppers said that free shipping without conditions is one of the promotions they would likely consider this holiday season.

"Free shipping offers drive online sales more than any other promotion, which is why they remain popular with retailers," said Scott Silverman, Executive Director of Shop.org.

"Unfortunately, free shipping is not free for retailers. Merchants can minimize the financial impact of these promotions by carefully analyzing the conditions required for their customers to receive free shipping."

Along with offering free shipping promotions, retailers will use a number of other marketing tactics to drive sales. Sixty-three percent of retailers will offer online-only sales this year, up from 59 percent two years ago. Thirty-five percent of companies will offer early shopper discounts, 37 percent repeat buyer discounts and 55 percent "refer a friend" promotions.

Customer’s main reasons for shopping online rather than in stores is the ability to shop at any time of day (58%), not wanting to deal with crowds (43%), and the convenience of shopping online (38%). Shoppers also said they like comparing prices online (36%) and that items are usually easier to find online than in stores (29%).

"As consumers become more comfortable with the web as a shopping resource and sales channel, they are naturally spending more of their holiday budget online," said Helen Malani, Shopzilla’s Chief Shopping Expert. "If consumers continue to have a satisfying experience online, the channel will continue to grow for many holiday seasons to come."

Free Shipping To Drive Online Holiday Sales
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