Free shipping becomes commodity offering vs benefit for holiday shoppers

For the past number of years, many millions of consumers had chosen to buy online vs in brick and mortar retail (Including on Black Friday) because of two reasons. First, no sales tax (in most states). Second, free shipping. Not all online sites had offered free shipping in the past. It might have required a minimum expenditure of say $50 but it did entice people to shop one place versus another.

This year it appears that "Free Shipping" has become a commodity offering. This means that it is offered by a much larger number of online only retailers and is being matched by many brick and mortar retailers on their online sites. It has in marketing parlance become "a price of entry" into the online shopping game. You have to offer it to survive and compete.

This is very good for consumers but could pose financial problems for retailers. Shipping costs are not inexpensive for retailers to absorb and could hurt profitability numbers at the end of the holiday season when all is tabulated.

One online retailer that appeals to young urban hipster types, Karmaloop.com, throws "free shipping" and percentage discounts out to its loyal buyers pretty frequently all year long. However, when you click through to final payment terms on your purchase you find they charge a $1.50 "handling" fee and don't see that has a shipping charge. I have expressed to the CEO that I feel this is a bit disceptive to consumers. The company's response has been they need to offset the huge costs of free shipping and this is how their bean counters told them to do it. Bad idea.

Personally, I have become a heavy Amazon.com shopper because of free shipping and very low cost two day and overnight shipping options as a "prime" member, (which costs $79 a year and is worth it in my opinion). I also have found from the comfort of my beach side lounge chair better deals on Amazon then some advertised Black Friday offerings at brick and mortar stores with the added bonus of no sales tax and no shipping fees. Pretty hard to beat without facing the vicious Black Friday crowds.

Watching out for you everyday.

Eli