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8 types of shipping methods for ecommerce businesses

8 types of shipping methods for ecommerce businesses

Ecommerce shipping. The final frontier in your quest for online domination.

With 8 different methods to choose from, it’s like being a kid in a candy store. But instead of gummy bears and lollipops, you’ve got standard shipping, expedited, overnight, international, free, flat rate, local delivery, and click-and-collect.

By the end, you’ll have a shipping game plan that would make even Amazon green with envy. So grab your compass and let’s set sail on this ecommerce shipping adventure.

8 Main Types of Shipping Methods for Ecommerce

Shipping in ecommerce refers to the process of transporting products from an online seller to the customer’s doorstep. It involves selecting carriers, packaging items, and managing delivery times and costs to provide a smooth buying experience. Delve into the ins and outs of budget-friendly shipping solutions and see how economical shipment options stack up against other delivery methods.

Standard Shipping

Standard shipping is the most economical option, typically with shipping companies delivering orders within 3-7 business days. It’s usually the default choice at checkout and the most popular among customers. Uncover the secrets of economical delivery: Discover strategies to refine your standard shipping approach for affordable, dependable outcomes pleasing to your clientele.

Average Shipping Cost:

The average cost of shipping an Ecommerce order is $7.96.

Cost Effieceny Over Speed:

A study found that 79% of consumers chose standard shipping for their most recent purchase. The lower cost makes it attractive, even with longer transit times.

Typical carriers for standard shipping

  1. USPS First-Class Mail or Priority Mail

  2. UPS Ground

  3. FedEx Ground

  4. DHL eCommerce

Expedited Shipping

Expedited shipping is faster than standard, usually delivering in 2-3 business days. The tradeoff is higher shipping fees for the shipping company and the customer. Facing a tight deadline? Discover how swift delivery services can meet your timings, offering rapid transit solutions for urgent needs.

Two-Day Shipping:

According to Zipdo, 67.77% of US shoppers value two-day shipping when shopping online.

Common expedited services such as priority mail express

  1. USPS Priority Mail Express

  2. UPS 2nd Day Air

  3. FedEx 2Day

  4. DHL Express Worldwide

Overnight/Next-Day Shipping

For customers who need products urgently, overnight or next-day shipping is the fastest option. Orders are delivered within 1 business day, but the shipping costs are the highest. Curious about how to get your items the next day? Dive into our comprehensive guide on next-day delivery services, where we explain everything from pricing to how it ensures your package arrives promptly.

Increased Conversion Rates with Speed Delivery:

Red Stag Fulfillment reports that offering next-day delivery can increase conversion rates by 20-30%.

International Shipping

Selling to customers in other countries introduces complexity with longer transit times, higher fees, customs forms, and import duties. But it opens up sizable new markets. Exploring overseas markets? Shipping internationally can be your doorway to reaching a broader audience and growing your ecommerce reach.

Top considerations for international shipping

  • Choose reliable global carriers like UPS Worldwide, FedEx International, DHL Express

  • Clearly communicate estimated delivery dates and potential duty fees

  • Ensure products meet the destination country’s regulations and include proper customs documentation

Shoppers Crave Clarity:

39% of shoppers highlighted the need for clearer communication on exactly when their packages will arrive, when asked about their primary concerns about online delivery.

Free Shipping

Offering free shipping is a powerful motivation for customers.

Free Shipping Induces Online Shopping:

As per the data given by GrowthDevil, 49.7% of people agreed that free shipping is the main reason they shop online.

Buying Extras Just for Free Shipping:

24% of shoppers pay more or add more products to their carts to get free shipping.

Many sellers set a free shipping threshold or build the shipping cost into the product price. It can lead to larger average order values to offset the shipping expense.

Flat Rate Shipping

With flat-rate shipping, the price is the same regardless of order weight or number of items. It simplifies shipping costs for both sellers and customers. Discover how shipping at a flat rate simplifies and streamlines the online shopping experience for both buyers and sellers.

A flat rate works well for small, heavy products that in shipping containers are expensive to ship individually. USPS flat-rate boxes are a popular option.

Local Delivery

For sellers with a local customer base, in-house delivery is an option. The main benefits are fast turnaround times, sometimes same-day, and keeping the fulfillment center more under the seller’s control.

Click and Collect

Also known as “buy online, pick up in-store” (BOPIS), click and collect has the customer pick up their online order at the seller’s physical location. Discover how integrating a ‘buy online, pick up in-store’ service into your sales strategy can significantly enhance your customer experience and business efficiency.

It bypasses last-mile residential delivery challenges and gets products into customers’ hands quickly, often same-day.

Selecting the right mix of shipping methods is crucial for ecommerce success. Offering choices of both shipping speed and cost while managing shipping expenses helps satisfy customers and keep them coming back.

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Benefits of offering multiple shipping options

Providing multiple shipping options is essential for ecommerce businesses to meet the diverse needs of their customers and stay competitive in today’s market. By offering a range of shipping methods with varying speeds and costs, retailers can cater to different customer preferences, increase conversion rates, and ultimately drive more sales. Discover the transformative impact of omnichannel logistics strategies in aligning various shipping methods to exceed customer expectations and amplify business growth.

Cater to different customer preferences

Customers have varying priorities when it comes to shipping. While some shoppers are primarily concerned with cost savings and are willing to wait longer for their orders, others prioritize speed and convenience and are prepared to pay more for faster delivery.

Cart Abandonment:

According to a 2023 survey by ShipStation, over 90% of Australian consumers state that a lack of suitable delivery options can influence whether they abandon their cart.

By offering a mix of standard, expedited, and express shipping options at different price points, ecommerce businesses can cater to the diverse needs of their customer base and provide a more personalized shopping experience.

Top Delivery Concerns of Customers:

When asked about improvements to online delivery, speed topped the list for nearly half (48%) of global shoppers. Cost also emerged as a concern, with 43% desiring lower delivery fees.

Remain competitive with other online sellers

In today’s crowded ecommerce landscape, businesses must keep up with the shipping options offered by their competitors to avoid losing potential customers.

Matching or exceeding the shipping methods provided by competitors is crucial for online retailers to remain competitive and attract customers. This is particularly important when it comes to offering free and fast shipping, which have become major decision factors for many online shoppers.

Increase conversion rates and reduce cart abandonment

High shipping costs and limited shipping options are among the top reasons for cart abandonment in ecommerce.

By providing multiple shipping options at different price points, including free and low-cost options, ecommerce businesses can reduce the likelihood of cart abandonment and increase conversion rates. Offering expedited shipping services can also help capture last-minute shoppers and those who need their orders quickly.

Importance of Multiple Delivery Options:

30% of consumers indicate they will often or always abandon their cart if their desired delivery option is not offered. 

By understanding the benefits of offering multiple shipping options and implementing a range of methods to meet customer needs, ecommerce businesses can improve the shopping experience, stay competitive, and ultimately drive more sales. However, choosing the right mix of shipping options requires careful consideration of several key factors.

Factors to consider when choosing ecommerce shipping methods

Your product catalog and typical order profiles

When selecting the right shipping method or methods for your ecommerce store, it’s essential to analyze your product catalog and typical order profiles. The sizes and weights of your items directly impact shipping costs and the carriers you can work with. For example, if you sell large, bulky items like furniture or appliances, you may need to partner with specialized carriers that can handle oversized shipments.

Consider your average order value and the number of items per order. If you typically sell multiple small items per order, you might benefit from using flat-rate shipping boxes or envelopes. This allows you to offer predictable shipping costs to your customers, regardless of the order’s exact weight.

Offering free shipping thresholds

Offering free shipping can be a powerful incentive for customers to purchase from your online store. However, it’s crucial to set realistic free shipping thresholds based on your product prices and profit margins. Analyze your order data to determine the average order value and set your free shipping threshold slightly above that amount. This encourages customers to add more items to their cart to qualify for free shipping, increasing your average order value.

Free Shipping Threshold:

A 2022 consumer trends report by Jungle Scout found that 80% of shoppers expect free shipping when ordering a certain dollar amount of products.

Balancing shipping speeds and prices

Customers increasingly expect fast and affordable shipping options when shopping online. However, faster delivery methods, such as overnight or 2-day shipping, come at a higher cost. As an ecommerce business, you need to find the right balance between offering competitive shipping speeds and maintaining profitability.

Consider offering a mix of standard and expedited shipping options at different price points. This allows customers to choose the delivery speed that best suits their needs and budget. For example, you could offer free standard shipping (5-7 business days), alongside paid options for 3-day, 2-day, and overnight delivery.

Negotiating rates and terms with shipping carriers

As your ecommerce business grows, you’ll have more leverage to negotiate better rates and terms with shipping carriers. Most carriers offer volume discounts based on shipping costs vary depending on your weekly or monthly order count. The more packages you ship, the lower your per-package shipping costs will be.

When negotiating with carriers, be sure to factor in potential surcharges, such as residential delivery fees or fuel surcharges. These additional costs can quickly add up and eat into your profit margins if not accounted for in your shipping strategy.

Leveraging multiple carriers for the best rates and coverage

Don’t feel limited to working with one shipping partner or a single shipping carrier. By partnering with multiple carriers, you can compare rates and service levels to find the best options for your business and customers. This also helps ensure that you have backup options in case of service disruptions or regional limitations with a particular carrier.

Packaging considerations for cost-effective shipping

Your choice of packaging materials and methods can have a significant impact on your shipping costs and the customer experience. Using appropriately sized, lightweight packaging can help minimize dimensional weight charges for air freight, and reduce the risk of product damage during transit.

Invest in custom-branded packaging to create a memorable unboxing experience for your customers. This can help foster brand loyalty and encourage customers to share their experiences on social media, providing valuable word-of-mouth marketing for your business.

Eco-friendly packaging options

As consumers become increasingly environmentally conscious, consider incorporating eco-friendly packaging materials into your shipping strategy. Options like recycled cardboard, biodegradable packing peanuts, and compostable mailers can help reduce your business’s environmental footprint while appealing to sustainability-minded customers. Discover how adopting two-day delivery can impact your use of eco-friendly packaging materials, weighing the environmental benefits against the need for speed in shipping.

Handling international shipping complexities

If you plan to sell your products internationally, it’s crucial to understand the unique challenges and requirements associated with cross-border and shipping internationally. This includes navigating customs regulations, duties, and taxes, as well as ensuring that your products are properly labeled and documented for international transit.

Consider partnering with a global fulfillment provider or third-party logistics (3PL) company that specializes in international shipping. These providers can help streamline the international shipping process, ensure compliance with local regulations, and provide valuable insights into the best practices for reaching global customers.

International shipping resources and guides

To learn more about the complexities of international shipping, consult resources like the UPS International Shipping Guide or the FedEx International Resource Center. These guides provide detailed information on country-specific requirements, documentation, and best practices for shipping products globally.

What is the most common shipping method?

  • Standard shipping (3-7 business days) is the most popular choice for online shoppers

  • It provides an affordable option for customers while allowing sellers to fulfill orders efficiently

  • Standard shipping strikes a balance between cost and delivery speed, making it a go-to for many ecommerce businesses

When it comes to shipping methods, standard shipping that delivers within 3-7 business days is the most frequently chosen option by online shoppers. This method offers an economical price point for customers while still providing a reasonable turnaround time for online sellers to fulfill the order. For those needing faster delivery, Priority Mail is a viable alternative, presenting 1-3 day delivery times at a cost-effective price, making it important to compare it with standard shipping and other options for the best choice.

Why standard shipping is the most common choice

Standard shipping has become the most popular shipping method for several reasons:

  1. Affordability: Compared to expedited or overnight, shipping services, standard shipping is significantly more affordable for customers. Many online shoppers are willing to wait a few extra days for their order to arrive if it means saving on shipping costs.

  2. Reasonable fulfillment time: For online sellers, standard shipping provides a manageable window to process, pack, and ship orders. It allows them to efficiently handle a high volume of orders without the pressure of extremely tight deadlines associated with faster shipping methods.

  3. Balanced customer expectations: Standard shipping sets realistic expectations for customers regarding delivery times. By clearly communicating the 3-7 business day window, shoppers can plan accordingly and are less likely to be disappointed or frustrated with the delivery timeline.

The role of free shipping in the popularity of standard shipping

Free shipping has become increasingly common in ecommerce, with many online stores offering free standard shipping for orders over a certain threshold. This incentivizes customers to choose standard shipping, as they can avoid shipping fees altogether by meeting the minimum order requirement.

Hidden Costs Spook:

A whopping 70% of online shopping carts get abandoned, often because unexpected shipping fees and hidden costs turn shoppers away at the last minute.

When standard shipping may not be the best option: Take a look at expedited and overnight shipping

While standard shipping is the most common choice, there are situations where it may not be the most suitable option:

  1. Time-sensitive purchases: If a customer needs an item for a specific date or occasion (e.g., a birthday gift or event), standard shipping may not guarantee delivery in time. In these cases, expedited or overnight shipping may be necessary.

  2. High-value items: For expensive or high-value products, customers may prefer faster shipping methods with more secure handling and tracking features to minimize the risk of damage or loss during transit.

  3. Perishable goods: Products with short shelf lives, such as food or flowers, often require expedited shipping to ensure freshness upon delivery. Standard shipping times may be too long for these items.

The future of standard shipping

As ecommerce continues to grow and evolve, the future of standard shipping may be influenced by several factors:

  1. Increased competition: With more online retailers vying for customer attention, offering faster shipping times at affordable rates may become a key differentiator. This could lead to a shift in what is considered “standard” for shipping rates, potentially reducing the average delivery window.

  2. Advancements in logistics: Improvements in supply chain management, warehouse automation, and transportation networks could enable online sellers to process and ship mass quantities of orders more efficiently, potentially reducing standard shipping times without significant cost increases.

  3. Changing customer expectations: As consumers become accustomed to faster delivery options, their expectations for standard shipping may evolve. Online retailers may need to adapt their standard shipping offerings to meet these changing demands.

While the landscape of ecommerce shipping may change over time, standard shipping is likely to remain a popular choice for its balance of affordability and reasonable delivery times. As online sellers continue to optimize their shipping strategies, understanding the role of standard shipping in the overall customer experience will be essential for success.

Picking the Right Shipping Mix for Your Ecommerce Business

Offering the right blend of shipping options is crucial for ecommerce success in 2024. Standard, expedited, overnight, international, free, flat rate, local delivery, and click and collect all have their place in the freight shipping mix. The key is understanding your customers’ needs and balancing them with your operational capabilities. Interested in how shipping can be environmentally friendly? Discover the benefits of shipping with carbon neutrality and how it plays a crucial role in minimizing the ecological footprint of ecommerce.

Consider your product sizes, weights, and typical order profiles when choosing shipping methods. Negotiate rates with carriers and use shipping software to optimize costs. Regularly audit your shipping performance and costs to ensure you’re providing the best possible experience for your customers.

Packaging your products properly, communicating expected delivery dates, and promptly addressing any issues is also essential for building trust and loyalty with your buyers.

How will you optimize your shipping strategy to drive conversions and customer satisfaction this year? Take some time to review your current shipping offerings and identify areas for improvement. With the right approach, your shipping service can be a powerful differentiator for your ecommerce business.

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