E-Commerce Trends and Tools

Most of my e-commerce heads-ups come to you in the monthly links publication that is part of a Web Commerce Today subscription. But this month I noticed that....

Amazon's Free Shipping Experiment

For months Amazon.com has been experimenting with free shipping. It started with orders over $99. Two months ago it dropped to orders over $49. Now they're dropping the threshold to $25 for a several months' test.

You can read the details online. As I see it:

• Only items with adequate profit margins apply. There is a long list of exclusions. But essentially this applies to books, CDs, DVDs, electronics, tools, and kitchen products and some others. To make it clear, qualifying products are marked with a special truck logo.
• Items must be shipped to a single US address.
• Amazon offers the lowest cost shipping, but orders take longer. Amazon says, "Select Super Saver Shipping as your shipping speed. Note that order will take an additional 3 to 5 days to ship."
• Items must be grouped into as few shipments as possible.

What can smaller merchants learn from this?

Offering free shipping can give you a competitive advantage, but make sure that free shipping is offered on your terms, not the more expensive carriers.

Amazon is able to offer free shipping because they have carefully optimized their fulfillment system to cut costs to the bone. If you use drop-shipping or a fulfillment house, you may not be able to save enough on fulfillment to offer this. Amazon's shipping may be possible because of volume deals with the post office or other carriers that you can't match. Study this carefully before offering it.

Super Saver Shipping rates are built into their automated ordering and shipping calculation system according to a fairly complex business logic system. If you can't automatically distinguish products in your database that are qualified and automatically exclude them from the free rate if anything in the order doesn't qualify, then delivering free shipping may be more hassle than it is worth. If a human has to intervene in the process to set things straight you'll lose any savings you would have made through automation.

Amazon is an industry leader, so some of your competitors may follow this lead. Perhaps now is the time to get your systems in shape so you can offer great shipping deals three to six months from now.

PayPal's Shipping Center

The PayPal Shipping Center is designed to facilitate shipping in conjunction with United Parcel Service. You measure your package, weigh it on a bathroom scale. Then you enter the shipping information online and create a UPS Shipping Label which you print out on your printer. You can pay using your PayPal account. You drop off the package at any authorized UPS location or hand it to a UPS driver. Your interface also includes a window to that allows you to track your packages via UPS.

Of course, those who ship regularly will need another system, but for those who ship occasionally, such as auction sellers, this could be a handy utility. https://www.paypal.com/cgi-bin/webscr?cmd=_ship-center

Yahoo! Store Improves Order Process

Yahoo! is improving their order checkout process by giving the customer more feedback on where they are in the process. They'll be testing the new interface in September, and then roll it out to all their merchants after that. Take a look to see what a well-thought-out ordering system can look like. http://shopping.yahoo.com/merchant/info/styleguide.html