Free shipping search test results - Free Shipping Episode II

Last month, I wrote over on Scot’s blog about some interesting consumer search trends around the terms “free shipping” and “coupon code” and suggested that retailers who haven’t implemented programs for promotions and free shipping might be missing out on an important segment of consumers.

This time, I thought I’d give you a more specific example showing the power of selectively appealing to these types of shoppers.

We recently ran an “A/B test” for one of our clients where we tested some creative ad copy in a search campaign.  In one version of the ad copy, “free shipping” was specifically emphasized.  In the other version of the ad copy, shipping was not mentioned.

How did it go?

Interestingly, the “free shipping” offer didn’t increase click through rates in a statistically significant way.  However, conversion rates for “free shipping” ads were 26% higher than the control group that didn’t mention shipping.  Furthermore, the AOV (average order value) was nearly 8% higher for the “free shipping” ads. 

Net of click costs, the “free shipping” ads ultimately drove 13% more net revenue per order, which was more than enough to cover the cost of free shipping for the products we tested (hence, this campaign was ultimately more profitable despite the fact that shipping was free!).  But even if the results had merely broken even (meaning the better return on search ad spend was offset by the cost of offering free shipping), the client would still have benefited from absorbing more demand by attracting consumers who otherwise might have ended up shopping with a competitor.

So, when you’re thinking about your ad copy, don’t just focus on the product description – remember to have variations of your ad copy that emphasize great promotions, shipping, and anything else that might expand your appeal to a broader set of consumers with different priorities.

 

David Spitz, COO, ChannelAdvisor

Comments

[BFG 9000]

Hey David,

Could you clarify if it is just the ads that are different?
i.e. does everyone get free shipping regardless of the ad they clicked?

TTFN

BFG

[David Spitz]

BFG, good question. Free shipping was only offered to those who clicked on an ad mentioning "free shipping".

[BFG 9000]

Thanks David,

I suspect therefore that given the clickthrough rates were almost identical that had they offered free shipping to everyone (& made it big & bold on the site) that the conversion rate for the ads that didn't include any mention of free shipping would have increased accordingly.....

TTFN

BFG

[TraiaN]

David,

Since the offers were different (50% had free shipping on the landing pages, and 50% didn't) there is no point in comparing the conversion rate. The offer should be the same. Correct me if I am wrong.

[Kanny Paul]

Interesting!

I feel like there is a scarcity of good marketing today. Good marketing means which can convert the leads into sales. The only marketing that has moved me in the last couple of years is Social Media Optimization.