Study Finds U.S. Preference for Free Shipping Dropping Slightly

While most U.S. consumers still favor free shipping over fast shipping, the figure has dropped from last year, according to a new study from Pitney Bowes, driven by millennials’ greater willingness to pay for expedited delivery.

In its annual global ecommerce study, Pitney Bowes found 79% of U.S. consumers prefer free shipping with slower delivery over fast delivery at a cost, down from 86% in 2017. This was mostly driven by millennials, with 35% of them preferring fast/free shipping, up from 20% the year before.

That’s not to say they don’t expect their stuff to show up pronto. The study found 48% of consumers here consider the Amazon Prime bar of free two-day shipping as “acceptable,” with 47% saying it’s “fast” and 5% deeming it “slow.”

“If there is one finding for retailers to pay attention to, it’s this one: fast and free shipping is a must,” said Lila Snyder, President of Commerce Services at Pitney Bowes in a statement. “Retailers invest millions of dollars in marketing to drive consumers to their ecommerce sites, but all of that expense and effort is for not if they don’t also invest in attractive fast and free shipping offers that meet consumer expectations.”

Sixty-one percent of consumers were dissatisfied with their post-purchase experience during the holiday season in 2017, Pitney Bowes found, up from 47% the year before.

The top reasons for that dissatisfaction included late shipments (17% of respondents), the cost of shipping (15%) and inaccurate tracking (7%).

Not surprisingly, millennials were the most frequent ecommerce shoppers, the study found, with 47% saying they bought items online weekly or daily, compared to 28% for Gen X and 18% for baby boomers.

With the expectation bar set so high by Amazon and others, consumers have become an especially fickle and unforgiving lot. The Pitney Bowes study found that an astounding 91% of shoppers will abandon an online retailer if shipping isn’t free or fast enough; 43% said they’d go to a marketplace, 34% said they’d find another retailer and 14% would opt not to purchase at all.

Just over three-fourths of consumers worldwide (76%) said they prefer free shipping over fast shipping, unchanged from 2017. That preference was most pronounced among Canadians (89%) and Japanese (88%). Free shipping also remains the top criteria on deciding where to shop for U.S. consumers, cited by 80% of respondents, followed by fast shipping (66%) and free and easy returns (49%).

“More and more, consumers are telling us that the post-purchase experience is every bit as important, if not more, than the shopping experience that occurs before the order,” said Snyder. “The silver lining for retailers: consumers are giving you the blueprint for how to get it right, and those who get it right will be rewarded with customer loyalty and revenue growth.”

The Pitney Bowes study surveyed 13,000 consumers in 12 markets (the U.S. Canada, Mexico, Australia, France, Germany, the UK, China, Hong Kong, India, Japan and South Korea) as well as 50 retailers in the U.S., UK and Australia, between July and August 2018.

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