Free shipping is a crucial component of e-commerce sales.
More than six in 10 consumers won’t complete an online transaction unless a very important option is included.
According to the “2023 State of Shipping Report” from e-commerce shipping software provider Shippo, 62% of surveyed consumers say they won’t purchase with an online retailer in 2023 if free shipping is not offered, and just 3% say shipping costs don’t matter at all to them.
For the study, Shippo recently surveyed over 1,000 online customers 1,000 e-commerce retailers. and consumers. Following are highlights from each respondent group:
60% of respondents do at least half their shopping online, including 28% who do “all or almost all” of their shopping online. Only 41% of surveyed consumers said they did at least half their shopping online in 2022. About one in five (19%) shop roughly the same amount online and in-store.
Given the choice between free and fast shipping 75% of consumer respondents prefer free shipping.
The most important information consumer respondents want to see on a retailer’s website is shipping cost, followed by average shipping time, when the item will ship, and expected delivery date.
In terms of making online returns, 45% of consumer respondents said free return shipping is the most important aspect. Another 24% cited the ease of processing a return, 18% said how quickly they get their refund, and 9% said a longer returns timeframe. Three percent indicated they don’t care about online returns and 1% said they care about something else.
During 2022, the biggest e-commerce challenge for retailer respondents was cost of shipping (41%), followed by supply chain delays (12%), decreased consumer spending (11%), and customer acquisition (9%).
In 2023, a leading 36% of retailer respondents anticipate cost of shipping being their biggest e-commerce challenge, followed by cost of shipping (20%), decreased consumer spending (13%) and supply chain delays (8%).
46% of retailer respondents are somewhat confident in their current shipping operations, and 27% are very confident. Another 9% are not confident or somewhat not confident, while 17% responded with no opinion.
On average, 34% of retailer respondents spend 11-20% of an online order’s total value on shipping, while 32% spend 6-10%, 21% spend between 1-5%, and 13% spend more than 20%.
Almost seven-in-10 (68%) retailer respondents are utilizing two to four carriers, almost one in three are only utilizing a single carrier for every shipping need, and only 5% are using five or more carriers.
For more information and to download the study, click here.