Well this is just more terrible news. Especially for those of us who prefer to do our holiday shopping in our pajamas! According to an article in AdAge, retailers counting on online shopping to stimulate sales in this tight economy are wrestling with a big problem: free shipping. Rising costs could likely mean retailers will attach strings to holiday shipping promotions in an effort to preserve margins. Bah, humbug!
Shipping discounts, which have become a mainstay of the holiday season, are being reanalyzed by retailers as they weigh the pros against the cons. Transportation costs have skyrocketed in the last year, with diesel prices rising 50% year over year. In response, fuel surcharges applied by UPS and FedEx have more than doubled to 10.5% for ground packages and 34.5% for air packages.
Last holiday season, 37% of online retailers surveyed by Shop.org, the National Retail Federation’s digital division, offered free shipping without conditions. Free shipping with conditions was offered by 71% of online retailers. (Within the same season, retailers offer a number of promotions, some with conditions and some without.)
Retailers are likely to raise minimum-purchase requirements or set minimum-purchase requirements for the first time. Some likely will limit free shipping to only those shoppers who hold the retailer’s credit card. And others will offer free shipping to customers if they pick up the items at a local store. Great, now you can pay the cost of fuel and deal with annoying lines, etc. Personally, I think this is going to be one dismal holiday season. A lump of coal anyone?
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