Did you know that 83% of people are willing to wait an extra two days to receive an online order if they get free delivery?
According to a recent ComScore study, consumers are perfectly happy to forgo instant gratification if they don't have to pay for delivery charges.
That's how important free P&P is to online shoppers. But it's just one element of why free delivery is so important to consumers and why it can actually pay for itself several times over for an online retailer who offers it.
If the products you sell are available in a store, then it doesn't make sense to charge for postage. This is especially true if your product is sold in a department store where the consumer will have more choice for competitive products and you run the risk of them buying something else there.
The last thing an online retailer wants is for a shopper to abandon their shopping cart and head down to their local retailer simply to avoid delivery charges. That's a lost sale that might have been prevented.
When a shopper is making an online purchase, they are, for the most part, already committed to a brand. But they can very easily jump ship when faced with delivery charges.
According to the Wharton School of Business, over half of shopping cart abandonment is due to delivery costs. Wharton’s Professor David Bell reveals that: "A free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10.”
Here are some of the business benefits of offering free postage:
Short-term gains. Free delivery can immediately boost online sales.
Larger orders. Free postage can lead to larger orders particularly when retailers set minimum purchase thresholds.
Long-term gains. Many online shoppers will only buy from merchants that offer free delivery, so, when it’s offered, merchants should expect to acquire new customers.
Repeat purchases. Free P&P can contribute to the lifetime value of those customers that a merchant might not otherwise have achieved had it not been for free or discounted delivery.
Staying competitive. Customers are more likely to leave a merchant and shop at a competitor site if they are offering free delivery.
Of course, offering free delivery will add to the cost of a merchant doing business. However, you don’t have to offer free P&P on every item at all the times in order to increase sales or become more competitive.
Here’s how to manage your costs:
Offer free P&P with minimum thresholds. Setting minimum order value thresholds encourages larger orders and reduces risk. It's more realistic than free delivery on everything.
Offer free delivery on certain Items. Perhaps on products with higher margins.
Offer free delivery at certain times of the year. Target peak events such as Christmas.
Offer free delivery to certain locations. Setting geographic parameters either within country or on an international basis can help control costs.
Offer free delivery on returns. No-one wants to pay to return something that doesn't fit right or, worse, arrives damaged.
Offer flat-rate postage. While not free, shoppers will immediately come to the conclusion that larger orders are more economical.
Free delivery is something consumers expect and appreciate. When a merchant does something the consumer is happy about, they are building loyalty. So free delivery should be seen as a loyalty deliverable.
In exchange, merchants could consider asking for account registration or some other option to gather more information from the consumer or require the consumer to opt into email lists.
But what it really boils down to is removing a roadblock. The easier it is for the consumer to click the "buy" button, the more likely it is that they will go through with their purchase. And isn't that what we all want?
Small businesses have unique, localised advertising needs and are often subject to financial and logistical restrictions when it comes to marketing. So which approach is best – promotional or experiential marketing?
Promotional marketing, such as discounts and offers, focuses on creating an incentive to persuade consumers to take action by immediately purchasing a product.
A recent UK survey found that promotional campaigns produce a higher ROI than radio and outdoor advertising and one equal to that of TV commercials and print ads. 56% of the people surveyed felt more favourable towards a brand after receiving a promotional item and 79% said that it made them likelier to do business with the company.
However, giving things away isn’t always an option for businesses on a budget. So how can small firms compete with larger rivals?
For starters, they can focus on localising the nature of their campaigns and developing memorable ways of differentiating their messages from competitors. A niche can be a valuable commodity. Large companies often won’t bother targeting small segments of the market – and that opens the door for smaller specialised companies to flourish.
Experiential marketing techniques provide opportunities to directly and creatively engage potential consumers. One of the simplest ways of achieving this is by celebrating success or growth with the local community. Whether a business has opened a new location, launched a new product or won an award, take advantage of this opportunity and throw a bash, offer a limited-time service or sponsor a charity event.
Actively participating in your local community by sponsoring school or sports teams, operating a stand or entering a contest at a local fair, hosting an annual public cook-off will make customers happy and appreciative. Those feelings will, in time, foster trust, loyalty and provide an incentive to support your business.
Inspiring word of mouth is key to drive small business sales. A recent Nielsen survey found that 49% of consumers say that friends and family are their top sources of brand awareness. And another study revealed that 77% of consumers are more likely to purchase a new product after learning about it from people they know.
The more involved a business is in its community, the more of a stake the community will take in the business. By directly engaging with local consumers, small businesses have the advantage of building real relationships and appealing to customers’ emotions. That’s how experiential marketing can deliver results – even on the cheap!
Copyright © 2014 Duncan McCaslin, director of Kreate.
Things are changing on our local high streets. Consumers are shopping in a different way and these new habits are bringing exciting new opportunities for independent retailers.
Just last month, a report by the Local Data Company in conjunction with the British Independent Retailers Association (BIRA) revealed that the number of independents is now at its highest level in four years following a net increase of 432 new stores in the first half of 2014.
There are lots of reasons for this positive news – consumers are keen to support local retailers and the recovery, although unsteady, is certainly helping too.
But the biggest driver seems to be a shift in shopping habits. New data shows that we are increasingly swapping the old weekly food shop at an out-of-town supermarket for more top-up trips made locally. And that is driving footfall to all kinds of shops on our high streets.
The recession has permanently altered the way we shop. We are less keen to drive to out-of-town supermarkets. And we are determind not to waste food as we once did. That means we would often prefer to buy our food locally as and when we need it.
What’s more, when we are visiting a Tesco Metro or a Sainsbury’s Local to get some essentials, we are also increasingly visiting other local stores as well.
But that’s not the whole picture. We’re also lapping up any opportunity to get a bargain. While the likes of Tesco and Sainsbury struggle, discounters such as Aldi and Lidl are flourishing. And of course, we are increasingly shopping online too.
All this has prompted Goldman Sachs to suggest in November that one in five big supermarkets may need to close. It points to “altered shopping habits” as well as competition from the big discount chains and pressures from online retailers.
These are clearly seismic shifts – not just recessionary aftershocks.
Now’s the time for independent shopkeepers to grasp these new opportunities. It’s about promoting what makes you special and giving customers the kind of friendly, personal service that big names just can’t deliver.
Tell your customers just how much good they are doing by shopping locally. According to Independent Retailer Month, for every £1 spent locally, 50-70p goes back into the local economy. For the same £1 spent out of town or online only 5p trickles back to the local community.
After all, a recent survey by Vend has found that 53% of consumers who choose to shop at small businesses do so to support the local economy and 30% of shoppers choose small businesses to buy one-of-a-kind items.
The convenience of online shopping, however, is undeniable. Independent retailers can also win more business by having an appealing and accessible website where customers can browse, get information, order online and either have goods delivered or click and collect. Judicious use of discounts and deals will also appeal to many shoppers that are counting the pennies.
Above all, at this time of year, it’s well worth getting involved with Small Business Saturday. Taking place on 6th December, this grassroots campaign encourages consumers to shop locally and support small businesses in the run-up to Christmas and beyond.
You can download support and marketing materials on the Small Business Saturday website. And look out for the Small Business Saturday bus – coming to a town near you in November and December.
Blog by Rachel Miller, editor of Marketing Donut.
It's so much cheaper to keep a customer than to find a new one, that for a small business it's perhaps the most vital ingredient for a healthy future.
So how do you keep customers? Price is the most important factor for many shoppers and some businesses trade exclusively on that. But there are two problems with this as a long-term strategy: firstly, most customers don't decide where to buy on price alone; and secondly, those that do will eventually be worn down by an apparent lack of care by the seller.
Excellent customer service is the foundation stone on which to grow your online business. In this day and age, when so many companies give poor (or simply neglectful) service, it's also a fantastic way to stand out from the crowd.
It's not a short-term strategy; it should be a permanent, long-term mission statement. Being friendly, efficient and above all helpful may not immediately get you more sales, but it will help to persuade customers to return and it will encourage them to recommend your business to friends and family.
I'd like to re-emphasise the word helpful. Go out of your way to help your customers. Distinguish yourself from companies with robotic staff who parrot the usual line, not intending, or caring whether they really help. Actually solve problems, don't just sympathise; offer real solutions, not just a goodwill gesture.
Above all, contact your customers to check if they're happy. That’s what the restaurant trade calls the “two minute check-back”, and it works brilliantly when the waiting staff are properly trained – it allows them to check that everything is okay with the customer's meal and experience, but it's also a great opportunity to offer more drinks and get more sales.
Whatever you do, don't hide behind your website. You may not have that bricks and mortar store, but it's no excuse for zero interaction. Publish your phone number clearly; interact with customers through email and social media; contact them frequently for that “two minute check-back”.
The customer may not always be right, but they are always the king, and if you invest the time and effort to treat them like royalty then you'll be creating the conditions for a long-term, thriving businesses.
Copyright © 2014 Simon Michels is a director of Photo Productions.
Marketers are keener than ever to understand customer preferences and behaviour – and increasingly that means understanding data. But it has also becoming apparent that not all data is equal; the way you use it is key to how you'll be able to derive value from it.
This distinction comes back to the way technology has changed in recent years. As marketers, we know that everything is connected. But traditionally this isn't how we've stored and accessed data. Until now, we've mainly been looking at individual datum, not connections.
Graph databases fix this by because they explore connectivity within the data. More traditional relational databases answer simple questions such as: "what is the mean age of people shopping on Oxford Street?". In contrast, graph databases can identify relationships and answer queries like: "how many customers are talking about my brand on social media and how many of them know each other?".
This may seem like semantics but it actually represents a huge leap forward for informed marketers. So what are the three key things that graph databases can teach us?
Data from past purchases and information on customer interests can enable marketers to spot patterns and make recommendations or relevant offers to customers for next time. With a graph database you can go one step further and make real-time recommendations, instantly capturing any new interests shown in the customers’ current visit.
Looking at your customers, their connections and social media activity you can quickly identify those that are most likely to speak about your brand and recommend services to others.
Graphs allow you to ask questions such as: “which customers of mine are mentioning my brand on social media and via which channels?"; and "which have most social influence amongst their networks and like to write reviews?". You can then correlate this with: 2which of these digitally active customers are buying most of our products?"
In short, marketers can now identify the most appropriate individuals that can be nurtured into brand advocates.
In an age where global selling is the norm, many businesses now offer a wide range of products and services, making it hard for both employees and customers to navigate online or in-store. Using a graph database allows businesses to identify and offer customers a product that is closest to their needs and react quickly when problems arise.
For too long, it has felt like getting to know your customers is made more difficult by the way companies manage their data – databases are vast and can be overly complex to navigate.
Graph databases change this, building the importance of relationships into every piece of data and every query you make.
What may sound like a somewhat "techy" area is actually one that can deliver the most old-fashioned marketing advantage of them all: happier, more loyal customers.
Copyright © 2014 Claudia Remlinger, marketing director, EMEA, Neo4J.
Google recently announced that it would be slowly rolling out an improved Panda algorithm. As Google gets up to speed with its latest updates, so should you with your website.
Here are some things to consider:
One of the big changes Google has implemented with Google Panda 4.0 and 4.1 is its tracking down of poor-quality or "thin" content. If you publish short pieces of content with next to no useful information in them, the chances are that Google will not rank you very highly. So if your website is image-based and doesn’t share much in the way of useful, relevant content, now could be the right time to change that. What used to work for SEO may not work any longer.
Google says that it considers over 200 factors when ranking a website, and one of those that has become more influential recently is website and page loading times. Not only have people lost patience with slow-loading web pages, but they are also less like to convert if they visit a website that takes an age to get where they’re going.
It’s not just people you need to consider; Google’s spiders don’t appreciate the time it takes to crawl your pages. Use one of the many online tests to find out how fast your website pages load.
If your current website is a bit outdated or you’re starting from a blank canvas then it is a good idea to address the design of your site. It should be easy to navigate for both visitors and Google’s spiders. Try to include internal linking to speed up the customer journey and make navigation as clear as possible.
It is also important to test your website on a number of browsers (including Google Chrome, Firefox, Safari and Internet Explorer) to ensure it performs the same on each one. You can do this using BrowserStack.
Another thing Google considers is the amount of time each visitor spends on site, so although aesthetics can play a part in reducing Bounce Rate, the overall design and navigation is important.
An algorithm update might not always be a problem to some businesses, but for others, the changes will work against them. This recent update could have an impact on your visitor stats and if they have begun to decline or suffered a drop, then you know it’s time to make some changes.
Traffic to your website and pages is a good indicator of performance and by using analytics, you can usually see what has gone wrong. So keep a keen eye on your stats over the coming weeks to see if your website needs tweaking.
Copyright © 2014 Thomas Stocks, Varn Media.
Read Rory MccGwire’s blog on how Google is finally rewarding the right websites on the Atom Content Marketing website.