Target slashes online shipping fees
Target is raising the stakes in the free online shipping game by undercutting not only Walmart but now also Amazon.com.
Target announced it has lowered the threshold for free shipping on online orders to $25, making it among the most competitive among major retailers. Its previous free-shipping minimum was $50, which placed it in the higher end of the spectrum.
“Lowering the free shipping threshold from $50 to $25 is one more way Target is putting guests first and making it easier for them to shop Target when and where they want,” said Jason Goldberger, president of Target.com and Mobile. “We saw an enthusiastic response to our free shipping offer over the holidays. Now, whether guests are stocking up or doing fill-in shopping, we’ve enhanced our year-round shipping offer to be one of the best in all of retail.”
Amazon offers free shipping on orders above $35, and offers free two-day delivery for customers who buy a subscription to its Amazon Prime service. Walmart offers free shipping on orders of $50 or more. Many retailers, including Target, temporally suspend those minimums for the holiday shopping season. Goldberger said the retailer “saw an enthusiastic response” to that offer.
Target already offers free shipping on most orders placed with its branded credit card. Target also has a mobile app called Cartwheel for mobile shoppers. Target’s new $25-minimum is just one of its free fulfillment options, including always-free in-store pickup for eligible products – with more than 80% of orders ready in one hour – and free shipping on virtually all online purchases when using a Target REDcard.
The announcement comes on the heels of Target’s strong digital performance during the 2014 holiday season. Target.com set new sales records on Thanksgiving and Cyber Monday, while mobile accounted for 60 percent of Target.com traffic. Cartwheel, Target’s award-winning digital coupon app, also added 2 million new users. Cartwheel has surpassed $1 billion in promotional sales since it launched in 2013.
Target operates 1,790 stores and at Target.com.