Free shipping is the single strongest motivator in e-commerce, and at the same time a frequent source of losses if set by guesswork. It makes sense when it is tied to an order threshold that nudges the customer towards adding another item. Derive the threshold from the actual average order value – setting it a little higher works, setting it many times higher puts people off, and setting it below the average means giving a discount to those who would have bought anyway. Calculate the impact on margin, including the risk that shipping is precisely more expensive for larger orders. Communicate the shipping cost as early as possible, ideally already in the cart or on the product page; an unexpected cost at the end of the checkout process is the most common reason for cart abandonment.
See also: Abandoned cart, Margin and discount promotions, Price comparison website.
