The dog eat dog nature of eCommerce means online retailers need to optimise all aspects of operations, marketing and product design to keep sales volumes growing and margins healthy. Whilst a few years ago you could get away with throwing up a standard shipping policy, in today’s competitive landscape the shipping policy, and how its communicated, can have a huge impact on a business.
A large survey by BigCommerce found that 80% of respondents rated shipping cost and speed as influencing their decision to purchase – its importance was only second to price. It is therefore imperative that the shipping policy is (1) well thought through so that it increases sales rather than cart abandonment and (2) communicated effectively.
These days, it’s not uncommon to see vendors offering customers same-day delivery, full returns and refunds, advanced delivery estimates and free shipment tracking—all in an effort to stop potential customers leaving their site and probably heading over to amazon.
Shipping Policies Made Easy
Fortunately, many of the leading eCommerce platforms offer layouts and templates for shipping policies. Relying on their pre-made templates can save you a headache when it comes time to drafting a competitive policy that’ll help you stay afloat in today’s market conditions.
However, for those who would like to create an original shipping policy from scratch, it may not be as difficult as you imagine. Below, we’ll list some of the most important features that every eCommerce shipping policy should include if you want to attract customers and stay competitive.
Top Features of a Competitive Shipping Policy
No matter your industry or niche, there are a few key elements that every eCommerce delivery policy should include. Optimizing your shipping standards so that they’re compliant with your competitors’ starts with adopting the following items in your policy.
Standard and Expedited: Offer Both
The truth is that customers are spoiled these days. One of the biggest causes of abandoned shopping carts is the meteoric rise in expectations that customers have regarding delivery times.
With the advent of Amazon Prime, many customers expect same-day or next-day delivery. While that’s not always a viable option for some customers, it’s important that you offer the fastest delivery option possible as a potential add-on to customers’ orders—this way, they won’t grow impatient and abandon their cart.
Be Up Front About Refunds and Returns
Handling returns and refunds is an inevitable, yet painstaking, aspect of every entrepreneurial venture. However, it’s only made more painful by including obscure, confusing, or deceitful return or refund policies—this is also one of the fastest ways to ensure you never win back their business again.
Instead, be specific about your return standards and be transparent regarding item eligibility for refunds. You should also clarify whether you or the customer are on the hook for covering the cost of return shipping.
Delivery Estimates and Track Shipping
It’s impossible to accurately predict the shipment of every delivery you make, especially during busy holiday seasons. However, most customers now expect rough delivery estimates with every order. Rather than emphasizing fleet management in your shipping policy, you should prioritize the outsourcing of logistics and courier services to companies with GPS tracking infrastructure in their vehicles.
Make Parcel Insurance Optional
Important deliveries should be insured to cover the cost of damage, theft, or misplacement. However, not everyone wants to pay a premium for insurance, especially when the value of the product is relatively low. For this reason, customers expect optional parcel insurance offered at checkout to ensure peace of mind during high-priority deliveries.
Drafting the Perfect Policy
Now that we know the general standards regarding what customers expect from a competitive shipping policy, let’s take a closer look at what a policy should entail. Below is a list of the general information that should be included in an ideal, customer-friendly shipping policy:
● Cost of shipping and various methods of delivery (i.e., standard, expedited, same-day)
● International shipping availability
● Payment options (i.e., credit, cash, digital currencies)
● Handling time
● Delivery limitations (i.e., PO boxes)
● Additional notes and information
An ideal shipping policy is one that satisfies your customer’s questions, so they don’t have to reach out to customer support. After all, most shipping-related inquiries are merely requests for basic information about shipping costs and estimated delivery times.
If you provide this information right in your policy, then you make both your lives easier.
The Anatomy of a Shipping Policy
In the example below, you will notice several critical elements that this hardware store has included in their policy—promotional information, free shipping eligibility, return policy, item tracking, and estimated delivery times. By including this information up front, the store is minimizing the number of inquiries they receive about their shipping standards.
In this case, the vendor does well to include simple graphics at the bottom of the page that communicate critical pieces of information for the reader. For instance, the graphics specify that oversized items may not be eligible for shipping and that even some clearance items are ineligible for parcel shipping.
Depending on the inventory you carry, you may want to follow in the footsteps of this example regarding freight delivery notifications. If you stock oversized items, you should include a bullet point about weight and size eligibility for parcel shipping versus freight shipping.
Empowering the Customer
A customer-focused eCommerce vendor should always go out of their way to include as many shipping options as possible for their customers. This way, they have the power to decide for themselves whether they can afford to wait a week for an “Economy” grade delivery service or pay a premium for one-day delivery for high-priority items.
Below is an example shipping policy from a popular department store. Although they provide four options for shipping, this isn’t necessary for most smaller eCommerce vendors. However, a minimum of two options—expedited and standard—is necessary to appeal to shoppers who need their product in a hurry.
Like the first example from the hardware store, this department store shipping policy includes information about oversized shipping. In this case, the customer is informed about the estimated delivery arrival date, rescheduling availability, and regional availability. If your business stocks oversized products, it’s a good idea to supply this information as well.
You may notice that this store, in their first bullet point, that this store also mentions that they restrict shipping to one address per order. Although it’s rare that customers request multiple shipping addresses in a single order, it would be wise to include an item about this in your shipping policy to avoid confusion or a potential dispute.
Return & Exchange Periods
Inevitably, online purchases will result in semi-frequent returns and exchanges. To avoid unnecessary confrontation from customers, make your product return and exchange eligibility as clear as possible within your shipping policy. Ideally, you can present your return periods in the form of a standard table chart, such as the one displayed below.
To drive customer loyalty, you could incorporate the same return policy as the one shown above by offering longer return periods for customers who have bought into a club membership program. Not only will this satisfy the demands of your customers who want a longer “safety net” period in which they can return a product, but it can also help drive long-term customer retention.
Returning an Item
It’s not enough to simply state the length of the return period for certain products. Rather, you must go a step further by listing the various options that customers have when it comes to returning the product. This way, you can eliminate confusion on the customer’s end regarding how they can receive a refund for their purchase.
We’ve included a template for a basic “How To Return” subsection of a shipping policy. Savvy eCommerce business owners should include a section resembling the one below.
While eCommerce vendors usually do not have a brick and mortar store in which to facilitate in-person returns, online business owners should still include instructions regarding returns. This is because some customers may be curious about whether the company uses prepaid return labels for free shipping, or whether the return shipping cost is incurred by the customer.
You should also include the estimated number of business days required for an item to be fully reimbursed upon receipt by the seller. In most cases, this ranges from 2 to 5 business days. Depending on the customer’s bank processing time, it might take up to a full week before the refund is reflected in their account, so be sure to mention this in the policy.
Last, you should make sure you cover all your bases by making clear what your company’s stance is regarding damaged product returns, return shipping costs, and incorrectly delivered purchases. Below is an example of a consumer electronics company that has included some of this information at the bottom of their official shipping policy.
Wrapping It Up
Now that you’ve created a standard shipping policy for your eCommerce store, you should include a final note at the bottom providing a contact address or phone number in case the customer has any questions. This way, you can deal with ambiguities and inquiries before the sale is made—which is always preferable to fielding customer complaints after the fact.
Remember that a shipping policy serves one fundamental purpose: to explicate the cost of shipping, and how fast the item will arrive. If your policy is able to clearly break down this information, then you’re well on your way to earning a satisfied customer.
Author: Kelly Davidson
Kelly Davidson is a writer at Merchant Savvy, a comparison site that reviews and rates ecommerce platforms, merchant account providers and small business software.