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Should you be offering free delivery?

Should you be offering free delivery?

Free delivery has become the ‘norm’ in many cases, as it’s widely adopted across the online retail industry. Many retailers offer free delivery in different forms, such as unconditional, or with a spend threshold. IMRG conducted a survey of 300 retailers in order to find out which options were most widely adopted, and what seems to be the industry norm. This way, we can answer the question on every retailer’s mind: should you be offering free delivery?

We can see from the graph below that the most popular delivery options, were standard free, conditional (selected by 174 retailers) and next day paid (187). These two options were the most popular in ecommerce by far, followed by click and collect, and standard paid, or third party pick up. The least popular was next day free, unconditional, as many retailers likely don’t offer this option.

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What are the most popular delivery options?

(Source: IMRG’s survey of 300 retailers, April 2022) 

These results were compared with the most popular delivery options back in August 2021, compared with April 2022, to find out what’s changed (with fewer retailers, as less answered the survey in August 2021). Interestingly, those offering conditional standard free delivery, and next day paid had increased, with the biggest differences being found in next day free conditional and click and collect from a 3rd party. Next day free, conditional, has significantly decreased in popularity, whilst click and collect from a third party increased in popularity.

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Delivery Options 8 months Trend

(Source: IMRG’s survey of 300 retailers, April 2022)

The data was then broken down by category to see the most popular options, within each sector. Clothing saw standard free conditional as the most popular, followed by standard paid, suggesting thresholds were used. Home and garden showed a similar trend, whilst gifts had standard paid as the most widely used option. Beers wine and spirit was by far most popular with standard free, and electricals saw a near tie between standard conditional, standard paid, and unconditional free.

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Standard Delivery Options by Category

(Source: IMRG’s survey of 300 retailers, April 2022)

We can see from this data that free delivery is a popular option, so most retailers should be offering it. However, it mostly comes with a threshold. This benefits the retailer, as it increases profit margins, and the customer, as they feel like they’re getting more for their money.

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