Raise Prices and Make More Sales

by Philip Busk

Published on this site: September 27th, 2006 - See more articles from this month

Are you afraid to raise the prices on products in your online store? Do you think you have to have the lowest priced item on the web to make a sale? You are probably wrong.

Recently I was told to try to raise prices and include "free" shipping on one of my online stores. I tested the results over a three month period and guess what? The site had more sales with higher prices. It's not really the higher prices that created more sales; it's the free shipping message.

Offering free shipping and raising prices to cover the cost of shipping increased conversion and sales by twenty percent. Conversion rates increased another fifty percent when I created a compelling free shipping message and made it one of the first things seen when landing on the home page.

High Search Engine Rankings is not Enough

As a search engine marketing professional, many times I use my own sites to test new search engine ranking techniques. Consequently, my online stores tend to rank pretty high for thier particular product niche.

One of my online stores offering CD racks and supplies had good traffic and high search engine rankings but had a low sales conversion rate. The site was listed on page one of Google's search engine for several of the targeted primary keywords.

With traffic and search engine placement in decent shape, I looked at conversion metrics. The site was below the industry average for conversions. A consultant suggested that I test a few methods to increase sales including adding free shipping.

Just Raise the Price, It Will be ok

We added free shipping on every product but didn't want to lose any profit margin. I was nervous about raising prices in a very competitive market. I also felt that people would just do a first look comparison of our "shipping included" number to the next sites listed price that didn't offer free shipping. The consultant said to just try it and see how it goes.

By adding the average price of shipping to each item we could put the delivered price in the store and not change profit margins. After one month, I could see that free shipping on this site was a good idea. Conversions increased over twenty percent. That was a nice increase but it wasn't close to what I expected. We needed to make sure every visitor absolutely couldn't miss knowing products would be shipped for free.

Make Your free Shipping Message Obvious

Studies show "Delivered Price" or "Shipping Included" aren't compelling messages to web surfers and "Free" draws the eye and initiates action. "Free Shipping" and "We Pay for Shipping" were both added close to the product buy button. That change increased conversions by ten percent. A month later we decided that because many searchers entered the site via the home page, there had to be a bold free shipping message added at the point of site entry. Adding the words "Free Shipping" and "We Pay for Shipping" prominently on the home page raised conversions more than fifty percent.

A Few Extra Benefits from Offering free Shipping

There are other benefits to offering free shipping for both store owner and store customer. The owner has no shipping charges to track and there are less ordering problems due to bad links to shipping companies. The shopper can make easy price comparisons and doesn't have to figure out shipping prices by going partially into the check-out tunnel. Customers also get through the check-out tunnel with less decisions to make and buttons to click. Less is always better in the check-out process.

More improvements can certainly be made in this area. We still get calls from people that want to be assured the shipping is free and that the price they see next to the buy button is the price that will appear on their credit card.

Just Try Offering free Shipping and see How Well it Works

If you have a site that sells product, seriously consider offering free shipping. Just try it out. You really have nothing to lose except some time.

Assuming your site already sells a good product and has a decent layout, good navigation, and a clear message, free shipping should be on the top of your list of techniques for bumping up conversion rates. You will see results. If you get results close to the ones I experienced, you will see conversion rates increase by over fifty percent of there present value. A conversion increase of ten percent is great for your bottom line and fifty percent is even better.

Philip Busk - is a recognized expert in the compact disc and cd packaging industries, sales and marketing, and search engine optimization. See http://www.buskerdoo.com for examples on implementing free shipping.