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Logistics & Fulfilment

Amazon lowers free shipping threshold

Amazon Australia has lowered its free shipping threshold in a bid to improve the customer experience.

Customers now qualify for free domestic shipping on eligible orders of $39 or more, down from $49 or more. Orders are delivered in three to five business days for customers in metro areas, and five to eight business days for customers in regional and remote areas.

Customers can still pay extra for faster delivery, with same-day delivery available to customers in residential areas of Sydney and Melbourne, next-day delivery for customers in metro areas and one to three day delivery for customers in regional and remote areas.

The move, announced on Wednesday, comes as more retailers see free shipping as a way to convince customers to hit the ‘buy’ button online.

A recent survey of 3000 digital consumers and 800 online merchants in Australia, the US and UK found that free shipping was a deal breaker for consumers.

The survey, which was commissioned by e-commerce platform Big Commerce, found that four out of five Aussie consumers have made a purchase from a retailer due to free shipping.

Of course, shipping is never really ‘free’. If it’s advertised as such, it typically means the retailer is eating the cost, and making up for it elsewhere.

Free shipping thresholds are how many retailers wear the cost of shipping. It’s common practice for businesses to set the threshold slightly above their average order value in order to persuade customers to add an extra item to cart, giving them more wiggle room.

When asked whether this was a factor in Amazon’s decision to lower its threshold, a spokesperson for the e-commerce company said: “Our focus is on continuing to improve the customer experience on amazon.com.au.”

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