It’s no secret that Etsy has long encouraged sellers to offer free shipping on their products, but can this offering actually help you increase sales?

Let’s break down why you may want to consider offering free shipping for your Etsy shop, and how you can use this tactic to increase your overall sales volume and revenue.

Why Offer Free Shipping?

Etsy states that buyers have noted friction in the buying process when they incur additional shipping costs on top of the product costs they see on a store. Say you’re shopping for an item, then hit the check out and are suddenly surprised by an additional (often costly) shipping fee - no one likes surprises! This, in turn, increases buyer bounce rates on the check out page, and therefore results in lost potential sales. 

It’s worth noting that this is not isolated to Etsy shoppers. A number of studies have been conducted on online shopper behavior and expectations: Almost 80% of consumers say that free delivery would make them shop online more, according to research conducted by Walker Sands.

By offering free shipping, therefore, you are providing a better customer experience and making it clear what the total cost of the item is from on outset. Shoppers are more likely to complete the transaction and far less likely to bounce off in the check out process - this means more completed transactions and sales for you!

How to Use Free Shipping Strategically: Repricing your Products

Just because you decide to offer free shipping doesn’t mean that you’re going to have to eat the cost of shipping and reduce your overall profitability. In fact, using free shipping can be used as a tactical tool. One way sellers can do this is to simply increase the cost of your product listing to bake in the cost of shipping into the amount.

You may look at this and think, “But then my product will be priced higher than my competitors”. In reality, this sentiment doesn’t account for two key factors:

1. You have to keep in mind that many shoppers will actually filter shops for only those offering “free shipping”. By adding free shipping, you can increase traffic to your shop because you become part of shops listed under this filter (whereas you will miss out on these shopper segment altogether by not offering free shipping). 
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2. When repricing your items, you are no longer competing with all listings on Etsy, rather only those that also offer free shipping. See what pricing others with the same free shipping guarantee are offering and simply try to be competitive with them.

It’s worth noting, of course, you need to do some work to determine what your average cost of shipping is on listings in your shop, and ensure that you’re covering that cost when you price your items. Generally speaking, referring to competitors that also offer free shipping is a pretty good measure of what shoppers will be willing to pay so it will give you a realistic range, so bake in shipping cost, but stay competitive.

How Free Shipping Can Increase Average Order Value

There is another way in which adding free shipping to your shop can increase revenue and that’s in the way of increasing your average order value. Why would this happen? Well, offering free shipping brings down the barrier for customers to purchasing more than one product - they no longer have to worry about accounting for additional fees for shipping when they add more items from your shop. Since every item in your shop already has this shipping cost baked in, you benefit from increasing your average order value and selling more items per order. 

Some sellers also prefer to offer free shipping on a minimum order (eg. $30 min order) while many of their products might be priced around, say, $20 - therefore encouraging more customers to purchase at least 2 items in order to qualify for the free shipping. This is another good tactic that could help drive more sales and revenue for you overall. 

Many Etsy sellers have successfully implemented free shipping strategies only to further grow their sales and revenue, and increase order values. If you’re looking to test out this strategy, but still need to evaluate exact profitability on your listings, you can try a free trial of the Propel Profit App to run the profitability on your listings so you can implement the strategy with confidence to see how much more revenue this tactic could drive for you! Happy selling!

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