Booksellers Find Benefits in Offering Free and Discounted Shipping

For many online shoppers, high shipping charges from retailers are a deal breaker. Increasingly, retailers large and small — including indie booksellers — are taking a close look at their policies in order to respond to consumer preferences.

The UPS Pulse of the Online Shopper report, released in June, found that 58 percent of shoppers said that their top reason for abandoning an online shopping cart was that shipping costs made the total cost of their order more than they had expected, and the National Retail Federation reported this month that 42.3 percent of consumers consider free shipping or shipping promotions an important factor when choosing where to shop during the holiday season.

McLean & Eakin Booksellers in Petoskey, Michigan, began offering 99-cent shipping on each order during the holiday season of 2012, said co-owner Matthew Norcross. “It not only was hugely popular with customers, but also was not nearly as financially painful as we thought it would be. It’s been such a hit that it is now part of the store’s standard practices and staff routinely uses it as a selling point in the store — not just for holidays!”

An analysis of a random sampling of purchases sent via Ingram’s Direct-to-Home program (Baker & Taylor offers the similar Home Delivery service) showed Norcross that the store was clearing a 38 percent margin on average on the sales. While Ingram does charge the store shipping, Norcross said it is a reasonable rate for McLean & Eakin to cover, especially with the customer paying nearly a dollar toward it.

The 99-cent shipping offer also applies to purchases shipped directly from the store, whether ordered online or bought in the store. “We find certain customers are willing to purchase much more if they learn we are willing to box it up and ship it inexpensively,” said Norcross.

To keep expenses down when shipping from the store, McLean & Eakin uses Stamps.com, which offers discounts and at-home postage printing, and sends books through media mail with tracking.

“If booksellers do the math, they will find that net revenue only increases as more books are added as the shipping cost does not rise too sharply as you add them to the shipment,” said Norcross.

The store ends up spending just a few dollars per order to ship books, which amounts to less than if it were offering a 20 percent discount on the book’s cover price, Norcross noted, adding that the 99-cent shipping policy “has absolutely raised our sales and made for very happy customers.”

At Hicklebee’s in San Jose, California, customers are offered free shipping on purchases of $25 or more, which is often the cost of just one hardcover book. “People can certainly find books for less on competing websites, so offering free shipping for orders of $25 represents a small thank-you to our customers,” said store manager Ann Seaton.

Hicklebee’s fulfills online orders through Ingram’s Direct-to-Home service or from the store. Seton believes that shipping through Ingram is “a win-win” because the store saves on labor costs and the process is nearly hands-off.

Nine months ago, Books & Books, with locations in South Florida and Grand Cayman, began offering free shipping. The store’s website now displays a banner advertisement to inform customers that they offer free freight: “Every order — every day — everywhere in the U.S. via U.S.P.S.”

“It’s been very helpful,” said store owner Mitchell Kaplan. “We want to really encourage people to purchase off of our website, even if our margins are a little smaller.” Books & Books live-streams many of its events, and customers tuning in are reminded that they can purchase the speaking author’s signed book with no cost for shipping.

The store is also experimenting with mailings advertising remainders and discounted books, “sweetening it with the idea that there’s free shipping,” said Kaplan. There is no minimum purchase to receive free shipping on the remainders, but Books & Books takes the cost of shipping into consideration when it sets the price of the books.

Booksellers with IndieCommerce websites can manually change their shipping options to offer free freight to all customers, keeping in mind that orders fulfilled by Ingram will still have a shipping cost that the bookstore will be responsible for. Booksellers looking to add conditions to their free shipping offer, such as requiring a minimum purchase or offering free shipping based on location, should contact  IndieCommerceTraining Manager Scott Nafz by e-mail or at (800) 637-0037, ext. 7554.

Learn more about consumer shopping preferences from the UPS Pulse of the Online Shopper report.