Updated: Jan 11
Imagine you own an eCommerce site for selling silver jewelry online. You’ve invested time, energy and money into creating a fantastic looking eCommerce site that is easy to navigate, advertising that is bringing in the traffic, and your customers love the online experience. When it’s time to hand over the ordered jewelry to your customer, you have to depend on an external shipping service to make sure the parcel is delivered in good condition, on time and at the best shipping price. Even though the actual shipping and fulfilment is not under your control, with thought and planning, you can offer a shipping experience that elevates your brand image and ensures customer loyalty.
93% of consumers say shipping options are an important factor in their online shopping experience.
As a business owner or an eCommerce manager, you know customers want affordable prices, flexible shipping services options and speedy delivery. That means you need a delivery strategy. If you’re wondering what this is, strategic shipping is what makes you stand out from the crowd while also increasing your margins.
But before you strategize, consider these factors that are very important when it comes to shipping. Multiple teams in your company need to be well-coordinated - right from marketing to fulfillment. Decide your goals. Do you want better margins? To increase conversions? To go international? To service areas that previously couldn’t access your products? Which of the shipping strategies will you use? Once you’re clear about these, you can select a partner and implement your plan.
So let’s first talk about the main elements of the shipping industry.
Product size and weight: Ensure you have accurate weights and dimensions so that the carrier can give you an accurate rate. You can do this by grouping your products. Then get the weights and dimensions for the heaviest or largest 20% and the smallest or lightest 20%.
Shipping option: eCommerce shipping usually includes free in-store pickup, Less Than Truckload (LTL) freight carriers, same-day delivery, and free shipping. Platforms like Shoptimize help clients strategize based on the kind of delivery selected. For example, imagine your site sells a perishable product like seafood. Your shipping strategy will include turning on same-day delivery for local customers. Additionally, at a small surcharge, offer speedy delivery. This keeps the customer happy and increases your profits.
Scout for same-day delivery, next-day delivery and cost effective delivery for even the largest items from service providers in your vicinity instead of only looking at the big, known names. Often local companies deliver faster and at competitive rates.
Ecommerce shipping strategies are fluid and can be used in tandem with each other. Let’s look at the options.
65% of consumers say they look up free-shipping thresholds before adding items to their online shopping carts.
This simple strategy is easy to explain to customers and helps retain those who might otherwise abandon cart. But remember, someone has to pay and in this case it’s you. So see that you’re making enough on the orders to cover the shipping fee. You could offer free shipping only on certain products or after a cut off value.
Flat rate and table rate:
Flat rate is when you charge a basic amount regardless of the product price or size. This way, there are no surprises for the user at checkout. For example, you charge a fixed Rs. 89/- on all orders below Rs. 799/- and free shipping after that. Table rate is when shipping costs are mentioned for certain areas, groups of products, or order weight.
This is when you offer customers live rates in real-time directly from the carrier. This is ideal in cases of heavy goods like washing machines, coolers, furniture, and so on - when you want to offer best rates and still cover your costs. Since you’re charging the customer exactly what the carrier will charge you, it is the cheapest option.
Mixed and alternative strategies:
Think creatively to use a mixed approach that suits you. For example, if you are an apparel eCommerce site, offer free standard shipping services without a delivery date commitment along with options like Expedited shipping within 3 days at a table rate based on order value, and also offer live rate options for overnight and next day shipping.
Idea to help you go the extra mile: If, for example, a customer has ordered shirts, dresses, jackets, and socks, let the customer know when to expect the order – all together or on different dates. Offer the option of multiple delivery addresses. This is useful at festive times, when customers turn to online gifting. Incorporate eco-friendly packaging, a thank you card, or a discount on the next purchase. These bring the delivery experience into focus and make customers want to share with photos on social media. For example, imagine you are an online store for a subscription based service that sends women apparel and accessories each month. If your packaging is stylish and has a wow factor, the customer unboxing experience will be worth talking about. Adding a note to the person will give a personal touch to the delivery, or consider giving a coupon code that can be used on the next purchase. Offer shipping promotions to customers who share images, and unboxing videos on social media, and with family and friends.
Here’s a head’s up if you are starting out and need to plan a shipping strategy. Shipping services are a large expense and you must keep track of profit margins. A robust eCommerce platform can help you create a comparison table to calculate your total price to include the cost of shipping. This chart will include all expenses – product, packaging, shipping, credit card fee, custom duty if any, who pays for free shipping, and what the profit margin would be with each supplier. You can input many carrier services at the same time to access pricing, efficiency and customer satisfaction.
Some shipping services offer integration with your eCommerce platform such as Shoptimize. So in addition to getting access to powerful marketing, search engine optimization, catalog management, data analytics and more, you also get shopping cart systems. When the shipping is pre-integrated, you can use it as an application plugin or extension while the platform’s developers integrate the backend - eCommerce logistics division with the online site. Shoptimize clients with integrated shipping also have access to shipping aggregators like Shiprocket and ShipDelight who provide excellent, cost-effective coverage across regions.
You as admin can have control over enabling or disabling the existing shipping method, can calculate shipping costs, set countries, and access all shipping related information. Pre-integrated systems are time efficient and easy to use. Additionally, they can also be optimized for cost. For example, Shoptimize has a multi-warehouse model. Using this, brands enlist their warehouses as individual inventory sources for products. Customers can place orders against the nearest warehouse where the product is available. The brand owner can then fulfill these orders from the selected warehouse and thereby optimize the shipping costs.
When you use a pre-integrated shipping service on an eCommerce platform like Shoptimize, you need to key in some basic information.
Let’s assume you own an online socks store targeted at the metrosexual male.
Shipping rates and methods:Will you send your sock orders irrespective of order amount for free? Might there be a flat rate of Rs. 30/- per order? or offer live rates from courier services for bulk orders?
Product weights:Key in the weight of a pair of socks. Once weight is inputted, on an integrated platform, you can choose from various shipping services and use the shipping calculators to see pre-negotiated rates.
Preferred packaging and labelling: Your target audience loves the uber-chic unboxing experience. So select how that’s going to look – recycled paper box, unpadded envelope or a Poly mailer with a personalized message and cool branding? Some plugins offer packaging materials with varied pricing and also mention if any carriers offer free packaging. You can also print and pay for multiple shipping labels.
If your business requires insurance and tracking for security as well as customs declaration and forms, the eCommerce platforms like Shoptimize offer the options with their pre-integrated shipping services.
If your sock company is signing up with a pre-integrated shipping service, create a Business Account. This will give you value-added services like discounts, better expense tracking, and extra online tools.
Once you have your shipping strategy in place and functioning, reevaluate it every six months. That way you will be sure to know if you’re delivering the best service and experience possible at the best price for your customers. Stay with the eCommerce logistics partners and platforms that are willing to grow with you.
eCommerce warehousing, eCommerce logistics and shipping should definitely be a part of your online strategy but at the end of the day, it’s your site, your shipping and your rules to suit your business and customers. With the eCommerce logistics partners to guide you, you can improve and iterate as required.