What's your opinion on free shipping? If you see a lower price does that sway you?

[musicyouneed]

I sell CD's and in 2012, 2013 and half of 2014, I charged exact shipping.  I sold a lot but thought I might do better offering free shipping to Canada and a reduced to the US and the rest of the world.  So I raised the price and for 2014 and most of 2015 I have been offering free shipping.  Part of my decision was the DSR's and possible better placement.

Well when I do searches of CD's most of the CD sellers charge for shipping.  It shows the CD as $2.95 plus $3.00 for shipping, mine would show $5.95 free shipping.  I know it is the same but somehow the $2.95 with $3.00 shipping will sell before the 5.95.  

In Canada only  there are 144,686 CD's for sale and only 29,529 offer free shipping in Canada.  About 20%

In the US there are 6,503,157 CD's for sale and only 1,748,253 offer free shipping within the US. About 25%.

If free shipping is supposed to boost sales why do sellers not offer it as much.  I am now experimenting and charging for shipping on some of my listings to see it traffic and sales increase or decrease.   

[aubreyclay56]

im just trying the free shipping thing myself on a few items to see what happens,ive seen a few answers on this topic and some people say thats the way to go being that most people dont like to pay shipping, i know i really didnt answer your question,but im not sure there is an answer like i say im going to try that on a few listings kinda have to experiment with that one i think

[mr.elmwood]

Impossible to charge exact shipping unless you are doing currency changes every day, adding back in packaging, PP, and eBay fees.

I moved to "free" shipping 11 months ago and my sales took off. Further, this allowed me to increase many prices. Call it the psychology of numbers, if you will.

A line of widgets I had listed at $21.99 + $8 shipping = $29.99, I sold one in five months. Changed to $29.99 "free" shipping, and I sold five in one month.

Another line of widgets was $16.99 + $8 = $24.99 and sales were poor. Moved that to $27.99, yeah, three dollars more, and sales are great.

I do not compete with the low price sellers. I compete with the high price sellers. I try to value add my listings so it looks like I know what I am doing. I like to "think" that this gives some customers confidence to buy from me.

Having been retail for 35 years, customers do not like extra charges after the shelf price. Doesn't matter that it has always been that way, they just do not like it. Customers like to pay the price they see.

[femmefan1946]

It very much depends on your category.

I would not like to be using 'Free' shipping, which as others have stated really means including the shipping cost in the asking price, if I were needing to use a service, like parcel post that has a lot of regional rates.

My arithmetic just isn't up to the sums.

I sell in US dollars and plan to stick with that.

I use 'free' shipping to Canada and to the USA, but add a flat rate for overseas shipping.

Like mr. elmwood, part of my decision to move to 'free' shipping was the drop in the loonie. My products are from thrifts and estates so prices have not risen.

Actually prices have fallen because a title that used to cost me $1USD(~$1.00CDN) now costs me about $0.75USD.

And similarly my postage, although it remains the same in loonies, has dropped in USD. (That will change somewhat in January.)

That being said, my sales have been steady to rising, but I cannot be sure if winnowing my stock before our move across country and adding new stock is more or less important than the move to 'free' shipping.

[momcqueen]

In my line, free shipping only works if you're the only person selling what the buyer is looking for. It sweetens the deal for the buyer. 

If not, and you're mailing via Expedited Parcel in Canada, it means you need to add $15 to your asking price because, in my experience, the only buyer who will take advantage of a common item with free shipping is one who lives in a remote or northern part of the country where the postage cost alone is cost-prohibitive. 

Free shipping on a $15 item doesn't make sense in most cases. Asking $30 for free shipping when the cost is really $15 for the item and $10 to $15 for shipping just turns off most buyers everywhere else in Canada and probably prices you out of the market. It's also a major turn-off for your buyers outside Canada.

Also, I don't promote reduced, heavily-subsidized shipping rates because even if you charge a single cent for postage, the buyer can still leave you one star in your DSRs for shipping cost. For me, it's free or not free and nothing in between. 

But the opinions on this topic are widely varied. 

And I really don't think buyers understand that 'free shipping' means the cost of postage is buried in the item cost. I think they think someone else is paying for it, not the seller, like the post office is giving away freebies or ebay is paying for it. 

Adding $1.89 to the asking price of an item is hardly noticeable. If you can ship it via lettermail, then by all means do it. Two-dollar postage is practically free but it leaves you open to defects if the buyer doesn't receive it on time according to ebay standards.

Nothing is ever a comfortable compromise, that's for certain. 

[pjcdn2005]

I think that everyone is going to feel differently about it. You have to look to see what  works for other sellers in your category. Are the items with free shipping in your category selling more than those with an added shipping cost? Perhaps it is just the opposite for you?

[jt-libra]

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@musicyouneed wrote:

I sell CD's and in 2012, 2013 and half of 2014, I charged exact shipping.  I sold a lot but thought I might do better offering free shipping to Canada and a reduced to the US and the rest of the world.  So I raised the price and for 2014 and most of 2015 I have been offering free shipping.  Part of my decision was the DSR's and possible better placement.

Well when I do searches of CD's most of the CD sellers charge for shipping.  It shows the CD as $2.95 plus $3.00 for shipping, mine would show $5.95 free shipping.  I know it is the same but somehow the $2.95 with $3.00 shipping will sell before the 5.95.  

In Canada only  there are 144,686 CD's for sale and only 29,529 offer free shipping in Canada.  About 20%

In the US there are 6,503,157 CD's for sale and only 1,748,253 offer free shipping within the US. About 25%.

If free shipping is supposed to boost sales why do sellers not offer it as much.  I am now experimenting and charging for shipping on some of my listings to see it traffic and sales increase or decrease.   

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A few months ago, I experimented with free shipping .... but only for items shipped within Canada which would cost no more than $2.95 CAD to ship.  For an eye pencil, for example (or one of your CD's), which at one time I might have charged US $4.95 plus US $1.95 shipping, I changed to US $6.95 with free shipping.  I found that my sales with free shipping did pick up a little ... they didn't take off as was the case with Mr. Elmwood.

Cosmetics are very competitive so there's no way I can include free shipping to the U.S. Adding another $5.00 (light packet) to the selling price would be be prohibitive.

Nor do I offer free shipping for other than lettermail items.  I can't get away with adding $10 or $12 for parcel items.  They would never sell.

I have no answer for why sales of CD's sell more quickly with an added shipping cost.  There may be other sellers who can provide an opinion on why this is so.

So, in short, I'm slowly increasing the number of lettermail items I'm listing with free shipping (in Canada) because I did notice a small increase in sales.  And, hey, I'll take an increase, no matter how small 🙂

[momcqueen]

Another thing I've found is that free shipping on individual items seems to discourage multi-item orders because each item needs an increased cost to bear the price of free shipping. There is no incentive for a buyer to shop with one seller if every item is just a little bit too pricey and all ship free.

I'm aware we can set combined shipping rules to make certain multi-item orders ship free but I don't find it intuitive enough. I'm really wanting for Promotions Manager here on eBay.ca to help with that.

[musicyouneed]

Thanks for all your opinions.  I am testing out the waters with charging for shipping just to see if it makes a difference.  

I'll come back to this and let you know how it went for me.  The only buyers that benefit from free shipping are of course Canadians and they are only portion of my sales, maybe 30% in a good month.   

[reallynicestamps]

Nor do I offer free shipping for other than lettermail items.  I can't get away with adding $10 or $12 for parcel items.  They would never sell.

That's what 'it depends on the category' comes down to.

I use 'Free" shipping as much as possible, but when I sell a thick book or a bundle of postcards that weighs over 500 grams, I will move to Calculated Shipping.

The only buyers that benefit from free shipping are of course Canadians

Actually, when I am offering 'free' shipping I include my US customers in the deal.

All it needs is putting $0.00 in the Flat Rate Shipping box.

International customer get a 'reduced' rate too, since there is some amount included in the asking price for Canadian and US shipping.

But.

Your Mileage May Vary.

[zee-chan-jpn-books]

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@mjwl2006 wrote:
Another thing I've found is that free shipping on individual items seems to discourage multi-item orders because each item needs an increased cost to bear the price of free shipping. There is no incentive for a buyer to shop with one seller if every item is just a little bit too pricey and all ship free.

I'm aware we can set combined shipping rules to make certain multi-item orders ship free but I don't find it intuitive enough. I'm really wanting for Promotions Manager here on eBay.ca to help with that.

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When people buy multiple items from me (in Canada and US, I ship "free") then I try to include a nice freebie that I think the buyer will like. I also have "best offer" open, and I do get the occasional buyer who message me and say they want to buy a few books, can they get a discount? I always say yes and I ask them to tell me the price they have in mind and that's usually a fair offer price (and I still give them a nice freebie if they were polite in the message). Another nice thing about best offer is I get to see the buyer's feedback history first before I decide if I want to counteroffer or just outright decline and block them (those who gives out negatives and neutrals like candies). 

When it's international (I charge $5 or $10 flat rate depending on weight) then I adjust the shipping cost accordingly when people buy multiple items. 

But like you, I do wonder if having free shipping on individual items discourages multiple-item sales. But I like the convenience of "free shipping" since I can just price my items with shipping factored into it. 

When I *buy* (not very often on eBay nowadays) I just select to show price + shipping from lowest to highest, then I buy from one of the cheaper ones with best feedback scores. Or if it's a rare item then well there's probably only a couple sellers selling them so my choice is limited, whether or not it has free shipping means no difference to me as I only look at the overall price to determine if it's worth it to me. 

[rose-dee]

I experimented up until early 2015 with free shipping domestically on about a third of my items (those that could go letter mail), as well as free shipping on multi-item orders to both Canada and the U.S..  The former did nothing to increase sales, but the latter was a real winner.  (I can't speak to placement in searches due to free shipping, which may have been better, I really don't know, but it didn't help sales, so what was the point?)

So I've returned to a "shipping subsidy" model for the most part, while keeping the free shipping on multi-item orders.  I agree with 'femmefan' that success with free shipping does differ by the type of item you're selling, but also your buyer demographic and your competition.  Buyers in my categories are quite used to having to pay shipping, so as long as I can keep the cost of shipping very competitive, it doesn't seem to matter if the shipping cost is separated out from the price.  

A note here to those who may have forgotten: shipping cost DSRs were dropped as a seller evaluation factor quite some time ago, although they are still displayed.  So until February 20, 2016, in my view there's really nothing to fear by offering a subsidized shipping cost as long as it's in line with -- or better than -- your competitors' shipping costs.  That is, of course, unless you know your buyers are used to seeing free shipping on a majority of the items in your category and/or are a particularly demanding group. 

One other point: for Canadian sellers the entire question of free shipping is going to be subject to a different dynamic come February 20th.  Do we offer free shipping (on non-tracked services), hoping that buyers will be so pleased that they'll answer the on-time delivery question with a "yes" regardless of the actual delivery date?  Or do we charge shipping on many items in order to use tracked services and be spared "The Question"?  If we're going to want to use tracking more often to protect ourselves, will those increased costs mean that offering free or subsidized shipping even be financially feasible anymore?  

We Canadian sellers may have to do a lot of re-thinking around the whole subject of shipping in the New Year.  I really wish eBay had thrown Canadian sellers a small bone with respect to the new on-time delivery metric, by not presenting "The Question" to buyers who get free (untracked) shipping.  To me, asking a buyer who has not paid for shipping to rate timeliness is pretty unfair.  

[pierrelebel]

"What's your opinion on free shipping?"

In my opinion that is the way to go for e-commerce.

The world is changing.  This is 2015.

Look around outside eBay.  Most websites and online retailers offer "free shipping" today, meaning that the buyer does not pay additional money for a shipping and handling charge.  It is already included in the price as are all other seller's costs.

When you look inside eBay, currently 63% of all transactions on eBay "ship for free" (based on eBay.com, eBay.uk and eBay.de, the three largest eBay sites)

https://static.ebayinc.com/static/assets/Uploads/PressRoom/eBay-Factsheet-Q3-2015.pdf

I think it is important to note the difference between listings offering "free shipping" and transactions showing "free shipping".  The higher percentage of transactions showing "free shipping" proves that buyers prefer to buy when sellers offer "free shipping".

Now, we all recognize that shipping charges when shipping from Canada offer a challenge when competing with American or British sellers.  Most Canadians ship through Canada Post and their rates are generally higher, often much higher than competing services in the USA or the UK.  However, potential buyers do not care.  That is not their problem.  Canadians wanting to sell and compete outside their borders have to be competitive with American sellers.  And it is not easy!

[jt-libra]

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@pierrelebel wrote:

Look around outside eBay.  Most websites and online retailers offer "free shipping" today, meaning that the buyer does not pay additional money for a shipping and handling charge.  It is already included in the price as are all other seller's costs.

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That's true.  I shop on many on-line sites that offer free shipping .... usually with a minimum purchase of $25, $50 or even $75.  Based on comparison shopping, their retail price is not higher than their competitors who charge for shipping, so they're obviously shipping very cheaply.

On many, many occasions, items in a multi-item order are shipped individually, as they become available.  So it's not unusual to see an $6 or $8 item shipped by expedited mail or by UPS.

I've brought that to the attention of letter carriers who all say basically the same thing -- "Well, they're not paying the same postage as you are; they have contracts with Canada Post and UPS".  Of course they do.  Wouldn't it be nice if eBay had a contract with Canada Post!!  But as mentioned in another thread, with so few eBay Canada staff, I doubt that they're in a position to negotiate, even though there are thousands of Canadian sellers, and buyers, who would benefit.

[momcqueen]

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@jt-libra wrote:

...... Wouldn't it be nice if eBay had a contract with Canada Post!!  But as mentioned in another thread, with so few eBay Canada staff, I doubt that they're in a position to negotiate, even though there are thousands of Canadian sellers, and buyers, who would benefit.

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Paypal (or Pitney Bowes) does have a contract, though. Ebay Canada says any trouble we have with shipping is for paypal to help us with so therefore, Canada Post must have a large-scale agreement with Paypal or Pitney Bowes. How many postage labels are being purchased by Canadian ebay sellers through paypal each and every day of the week, month and year? Alone, I am fairly close to the bracket for negotiating a volume discount with Canada Post yet we all, as ebay sellers, sit here dumbly thinking our postage costs are too high. Yes, they are but it's in part due to either ebay, Paypal and/or Pitney Bowes skimming profit from our postage costs in order to provide the service. They wouldn't offer the label-printing service due to the kindess of their hearts.

ebay Sellers may do better to form a consortium and negotiate directly with CPC for the lowest rate possible. 

[pierrelebel]

"ebay Sellers may do better to form a consortium and negotiate directly with CPC for the lowest rate possible. "

I am confident Canada Post would be pleased to offer a more significant discount than they currently give eBay on some services as long as all Canadian sellers ship thousands of parcels daily from the same location!  Of course that is not possible.

Canadian sellers ship a few parcels daily from whatever location they use.  There is no economy of scale available to Canada Post.

[momcqueen]

I thought of that too BUT those large online retailers are not always shipping packages from the single location either. It's the reason my order from Old Navy might come in three shipments, and the one from Walmart in two. 

[pierrelebel]

" not always shipping packages from the single location"

True but each location still ships thousands of parcels daily.  That is simply not possible for eBay sellers.

The same principle applies to lettermail.

One can purchase one stamp at the time ($1.00 plus tax) or a booklet of ten stamps ($0.85 each plus tax) or - if you have substantial volume rent and use a postage meter and save a dime.

It is all about volume.

At the end of the day, if sellers can show Canada Post saving money, they will get a discount.  Otherwise there is no way Canada Post would give that money away.  Why should they?

[momcqueen]

Well that was a short-lived rebellion. Thank you for being the cold, wet blanket of reality, and general voice of reason. Otherwise, I might have embarrassed myself or something. 

[11canadianchick]

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@mjwl2006 wrote:

Well that was a short-lived rebellion. Thank you for being the cold, wet blanket of reality, and general voice of reason. Otherwise, I might have embarrassed myself or something. 

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LOL