A successful ecommerce business needs to have a well thought out shipping strategy. Customers want fast and affordable shipping. 38% of shoppers say they won’t purchase items from somewhere again if their shipping experience was bad. 60% of shoppers chose to go with a competitor because of the shipping options. 74% of shoppers rate free shipping as important when checking out. 45% have left their shopping cart at checkout because they were not satisfied with shipping options.
Although important, free delivery and fast shipping are not the only aspects of ecommerce shipping. There is so much more you need to consider while planning your ecommerce shipping strategy. Here are some aspects to take into account when creating your shipping strategy.
What is ecommerce Shipping?
Ecommerce shipping is the process of sending a product from a retailer to a customer’s destination. Making sure you are working with the right partner on your shipping can make it a very cost-effective, manageable, and fast.
What does the shipping process entail?
The shipping process starts when the order is received and ends when the customer has the package in her hands. This process can be taken down as 3 different steps: Order Receiving, Order Processing, and Order Fulfillment.
Order Receiving is when you receive the order and make sure you have the items in stock.
During the state Order Processing the order details are looked over and verified. Mostly the address to make sure it can be shipped and will get to the correct address.
Order fulfillment is when the items are picked, packed, and then sent out to be shipped.
Ecommerce Shipping Methods and Strategies
Every ecommerce company has a different shipping strategy. It all depends on what works best for that company and who you might partner with. The right strategy will all depend on the company’s audience, budget, margins, products, and multitude of other things.
Everyone just wants fast and affordable shipping. There are plenty of methods to keep shipping at a low cost to make sure there is a very low amount of shopping cart abandonment.
1. 2-Day Shipping
2-Day Shipping seems like it would be impossible to get. Only Amazon has that kind of shipping and it’s because of Amazon that everyone wants that kind of shipping no matter what ecommerce business they are shopping at. It seems like only ecommerce giants can get that kind of shipping speed. But that kind of amazing shipping can be offered no matter the size of business you are. You just have to be partnered with the right people.
2. Same Day Delivery
Same day delivery gets you packages delivered on that same day you ordered it. The majority of customers are willing to pay more for faster shipping. Same day delivery requires everything to be coordinated and organized.
3. Overnight Shipping
Overnight shipping would be a way to stand out. Everyone can work their way into offering 2-day shipping but if you offer for the package to arrive the next business day, it might be a game changer. The price of overnight shipping varies from carrier to carrier. Comparing prices to find the best rate would be the way to go.
4. Expedited Shipping
Expedited shipping is any method that is faster than standard ground shipping. the turnaround for expedited shipping all depends on what services you have with what carrier. When you offer expedited shipping, it can help reduce shopping cart abandonment and create a better relationship with your customers.
5. Freight Shipping
Freight shipping is basically transporting cargo across the world through air, land, or sea. What is considered freight? Anything that is larger than 30 in x 30 in x 30 in or it weighs over 150 pounds is what would be considered freight.
Basically, ecommerce businesses use this shipping when moving inventory from the manufacturer to a fulfillment center or distributors.
Ecommerce Shipping Costs
Ecommerce logistics and shipping can seem to be complex. And with the pressure of your customers expecting fast and affordable deliveries, it seems like a daunting task, finding fast yet affordable shipping for your customers. Calculated the shipping cost could get kind of confusing. There are a lot of factors to take into account while calculating. Here are some resources to help you find the right rates to calculate a good price to keep your customers satisfied.
All shipping carriers use the pricing technique called dimensional (DIM) weight to help calculate the cost of the shipping. This dimensional weight takes into account the size of the package to determine the cost that is will be to ship.
Reducing Shipping Costs
Finding ways to reduce your shipping costs can be kind of difficult. If you partner with a third-party logistics (3PL) provider, they will definitely be able to help you get those rates down and help you with your entire fulfillment process. Having them on your side would help you save money as well as time.
Shipping zones are the distance between where the package is coming from to its destination. These zones can range from Zone 1 to Zone 8, just in the continental US. These zones are based off where the package is being shipped from. Every shipping carrier used these zones to determine their shipping rates. Most of the time, if not all the time, the higher shipping zones are more expensive to ship to.
Shipping and Handling
The difference between shipping costs and handling costs are simple. The shipping costs are getting your package form the shipping carrier to the customer’s front door. Whereas handling costs are everything else in the process. The labor associated with it all, like the picking and packing of the packages, getting the shipping label, putting the shipment on to a truck, and any other fulfillment center services.
Ecommerce Shipping Rates
Different businesses use different structures on how they want to charge their customers for shipping. Some of the more popular options for ecommerce shipping rates are flat rate shipping and real-time rates.
Flat rate shipping is when shipping is the same price no matter what. This rate takes the average of what the shipping and handling cost would be for that said category. Yes. You might be paying more for the smaller packages, but you’d also be paying a lot less for the larger packages. It eventually evens out.
Real-time rates have the exact amount it will take to ship the order right there at checkout. It will charge the customer the exact amount it will cost you to ship it.
Another option would be to offer free shipping. This would help you not have any cart abandonment as well as build customer loyalty. There are a few ways you can do this and still be profitable. You can include the shipping cost in the price of your product. You could require your customers to spend a curtain amount of money before giving them the free shipping. You could also take a recurring fee for a loyalty program. If they are paying you this fee, they get free shipping. (e.g. Amazon Prime)
The ecommerce packaging you pick for your business affects not only the cost but also the customer experience. Once a customer gets the package it is usually the first in-person interaction they have with your brand. Try to make it a memorable experience with these simple ideas.
Choosing Your Packaging
When choosing your packaging you should consider a few things to make your packaging both cost-effective and a cool unboxing.
Once you determine what your product is and what the shape and size it is, making sure you know how much it weighs as well to pick the right package to both protect your products and keep it as cheap as possible.
Trying to understand if your package will be heavy will give you an idea on weather or not it is oversized. Now is this package fragile or more of a durable product. How much will we have to worry about completely protecting the package while its being shipped?
What kind of packaging does the manufacturer include when you or your logistics partner get the product.
And last try to decide it you want something plain or branded as your packaging. Once again, there are so many things you can do to create a great unboxing moment with your customers and your products.
Having a custom and branded package will not only help with the customer experience but you can also make sure you are getting the best rate for shipping. Keeping the dimensional weight rates in mind while choosing a package is very important.
Labels and Insurance
Shipping labels and insurance are little details of ecommerce shipping. These may be smaller detail, but they are still very important and make sure your customers have the best experience with your products possible.
Shipping labels are there to show the shipping carrier the important information about the package. They will have where the package is coming from and where it is going. Without a good label, the package could get lost and possibly mishandled. The label also will have a tracking number on it so you and your customers can track where their package is at in the shipping and delivering process. It will also have things like package weight as well as shipping class. It has all the information shipping carriers need in order to deliver the package to the right place as soon as possible.
Shipping insurance is a reimbursement promise to senders who has lost, damaged or stolen goods while they were in transit. If there are fragile items in your shipment, it might be smart to look into getting insurance for those shipments. Although it can cause your shipping cost to go up, quite a bit.
Tracking and Returns
You might think that the shipping process is done after the shipping carriers grab the orders from you but you want to make sure you are giving your customers the best customer service through the entire journey of the order. This includes both tracking their packages as well as making sure that if they need to return something there are no hiccups or difficulties. Customers who have a good experience with returns are way more likely to shop at that ecommerce business again.
Shipping Integrations and APIs
Making sure that your ecommerce technology works well together is very important. With having software for your online shopping cart and your shipping APIs integrated, your business can thrive. Companies like Shopify, WooCommerce, and Wix can change your shopping cart from a hassle to an easy seamless process easy for everyone.
Including a 3PL company can also impact your cart and shipping process. Including them to take care of the shipping APIs and the shipping side of things will make things less stressful for you and your company.
Let Launch Help
Here at Launch Fulfillment, we want to make sure you are taken care of through every aspect of the shipping process. We are here to help you make the process easy and stress free for your company. Contact us to see what we are all about. We are excited to help you in all your fulfillment and shipping questions.