Cost of Shipping is No. 1 Challenge for E-Commerce Merchants Today

Nearly 47% of consumers will spend a minimum amount to get free shipping. And, 42% of consumers say their willingness to shop with a retailer again if a package is lost depends on how the issue is resolved.

Na Ma Ku Ki Adobe Stock 296836811
NaMaKuKi AdobeStock_296836811

This year's market concerns have shifted from supply chain disruptions and delivery delays to changing consumer spending habits thanks to rising inflation and a looming recession. But while 2023 might not be another year of e-commerce growth, it will provide merchants the chance to build more resilient businesses, find creative ways to acquire more customers and turn first-time buyers into lifelong brand advocates, according to a new Shippo report.

For instance, the cost of shipping is the No. 1 challenge for e-commerce merchants today. Nearly 47% of consumers will spend a minimum amount to get free shipping. And, 42% of consumers say their willingness to shop with a retailer again if a package is lost depends on how the issue is resolved.

 

From Shippo:

 

  • 60% of consumers surveyed said they do at least half their shopping online, compared with 41% the previous year, while 61% prefer to purchase online when given the choice.
  • 41% of merchants said the cost of shipping was their biggest challenge in 2022 and 36% said that will continue in 2023. However, 62% of consumers won’t purchase without the promise of free shipping at checkout, but are willing to pay for “free” shipping.
  • On the flip side, fewer merchants are offering universal free shipping this year vs. the previous year when 22% always offered free shipping and 18% offered free shipping most of the time.
  • Only 10% of online shoppers wanted same or next-day delivery in 2022, down from 18% in 2021 and 21% of merchants say supply chain disruptions are still regularly impacting shipping operations vs 38% in 2021.
  • 68% of e-commerce merchants are utilizing 2-4 carriers, just shy of one-third are only utilizing a single carrier for every shipping need, and only 5% are using five or more.

 

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