The e-commerce shipping process includes tasks like preparing orders, packaging, labeling, and transporting them to the buyer's address. To ensure efficient delivery, you, as a seller, have a lot to cover.
We suggest starting with uncovering the difference between shipping methods and strategies, recognizing the key couriers, and learning the main cost factors. To top it off, you should know how to manage your delivery workflows via the right shipping tools.
And all of this is precisely what this article plans to cover.
Types of Shipping Methods
Shipping methods can be defined as the various options available for transporting your goods from one location to another. All these methods differ in the levels of speed, cost, reliability, and additional features offered to you or your customers.
Some of the types of e-commerce shipping methods include:
- Standard Shipping – Widely adopted by e-commerce businesses, standard shipping strikes a balance between cost and delivery time, making it a preferred choice for non-urgent shipments.
- Expedited Shipping – Offering a speedier alternative to standard shipping, expedited shipping maintains a balance between swiftness and affordability, making it an attractive choice for customers seeking quicker delivery without hefty fees.
- Express Shipping – Tailored for customers in need of swift delivery, express shipping ensures the fastest transit times compared to all other options. While it accelerates delivery, it often entails higher shipping fees, appealing to customers who prioritize immediate gratification or urgent needs.
- Dropshipping – Dropshipping involves outsourcing to third-party suppliers for direct shipment to customers. This method reduces inventory management costs and expands product variety without expecting you to rent a warehouse.
- In-Store Pickup – Providing added convenience, some retailers allow customers to retrieve online orders from physical store locations. Store pickup eliminates shipping fees and increases foot traffic to your brick-and-mortar stores.
- Freight Shipping – Suited for bulky or heavy items unsuitable for standard parcel shipping, freight shipping is commonly employed for bulk shipments and industrial goods, ensuring efficient transportation of large items.
The question of “How to ship my products to customers” isn’t one that can be answered easily here. But it’s best to offer as many shipping methods as possible so that your clients can choose what fits them best. This way, you’ll cater your services to a wider audience and will minimize cart abandonment on the ‘delivery’ step.
Marketing Shipping Strategies
While shipping methods cover the operational aspects of transporting goods, e-commerce shipping strategies involve shipping-related promotions and incentives used for achieving business objectives.
When implemented correctly, shipping strategies can play a key role in influencing customer satisfaction, retention, and overall shopping experience in your store. Effective shipping tactics can differentiate your brand, drive sales, and foster customer loyalty. Here are some impactful shipping strategies to consider:
Flat Rate Shipping
With flat-rate shipping, you charge customers a fixed fee regardless of the size or weight of their order. This simplicity can be appealing to both sellers and buyers since it eliminates the need for shipping cost calculators.
Clearly stating shipping costs upfront – including any potential taxes or fees – provides transparency and helps manage customer expectations. Leverage this strategy to help your customers avoid surprises at checkout.
Free Shipping
Free shipping is a powerful marketing tactic that can significantly impact your sales. This strategy eliminates the extra cost barrier for customers, making products more appealing and encouraging them to complete their purchases. It also can enhance the perception of value and affordability associated with your brand, contributing to customer loyalty.
When offering free shipping to customers, you can attract more shoppers, increase conversion rates, and ultimately boost revenue. However, businesses must carefully consider the financial implications of offering free shipping and strategize accordingly to ensure profitability while still providing added value to customers.
Dynamic Shipping Rates
Dynamic shipping rates are a smart approach to pricing that takes into account various factors such as UoM volume, destination, shipping method, and carrier. The key benefit of dynamic shipping rates is their ability to adjust shipping costs based on specific order characteristics. For instance, heavier items or deliveries to distant locations may incur higher shipping expenses, while lighter packages or local shipments may have lower costs.
When you implement dynamic shipping rates, your business can strike a balance between attracting customers with reasonable shipping fees and maintaining profitability. This flexibility in pricing also allows businesses to offer promotions or discounts on shipping when feasible, further enhancing the value proposition.
Limited-Time Shipping Offers
Creating urgency with limited-time shipping offers can encourage customers to complete their purchases sooner. For example, offering free expedited shipping during holidays or special promotions can persuade customers to buy before the offer ends.
Pairing shipping deals with other offers – like product bundles or discounts – can make them even more attractive. What’s more, you can automate the offers and cost calculations using special shipping rules solutions.
Subscription Shipping Programs
Subscription box shipping is common for businesses that offer subscription-based services or products. According to this strategy, you regularly ship products to subscribers on a scheduled basis while customers pay a flat fee for unlimited shipping over a specified period.
Subscription shipping program benefits both parties by providing convenience and cost savings. It also encourages repeat purchases and fosters long-term customer relationships, increasing LTV.
Cash on Delivery
Cash on Delivery (COD) shipping is a strategy that allows customers to pay for their orders upon delivery rather than in advance. With this approach, you offer the convenience of inspecting your product before making payment, reducing the risk of fraudulent transactions and increasing trust.
Enabling COD shipping in your store can broaden your customer base, expanding to those who prefer to not pay upfront or have limited access to electronic payment methods. It can also boost sales conversion rates by minimizing purchase hesitancy. Still, the COD strategy isn’t supported by all carriers and can, therefore, limit you in their choice.
Personalized Shipping Options
If you want to stand out, you can tailor your shipping options based on customer preferences and your brand specifics. Providing choices such as gift wrapping, personalized cards with messages, or eco-friendly packaging can resonate with different segments of your customer base.
International Shipping Best Practices
International e-commerce shipping can be viewed as a more challenging shipping method due to many factors. Customs regulations, shipping laws, longer transit times, and increased costs associated with cross-border transactions are among the most common issues associated with this shipping type. Here’s what you need to consider and prioritize before you decide to cater to global customers:
- Optimize Your Packaging – Efficient packaging not only reduces shipping costs but also minimizes the risks of damage during transit, which are higher for international shipments.
- Ensure Customs Compliance – Research customs regulations and hire experts to make sure you accurately complete shipping documentation. This will help your customers avoid penalties and additional fees.
- Partner with Reliable Carriers – Collaborating with trusted shipping partners experienced in international logistics can streamline the shipping process and ensure timely deliveries.
E-commerce Delivery Carrier Options
Delivery carriers are responsible for the physical transportation of products purchased online. Unless you’re selling on a marketplace with its delivery system – like Amazon – you need the services of shipping carriers to transport the bought goods to clients on behalf of your e-commerce business.
As a rule, they offer as many shipping methods as possible to let you adjust your business model. Also, they may provide additional services like package tracking, insurance, customer communication, and delivery confirmation. Below, we list the most popular shipping carriers worldwide.
United Parcel Service (UPS)
Key feature: Enhanced package tracking.
UPS, known globally for its robust tracking system, employs cutting-edge technology to ensure extremely high transparency in package tracking and management. Thanks to the integration of advanced tracking technologies, such as GPS and barcode scanning systems, UPS provides customers with real-time updates on the status and location of their shipments. This helps them instill confidence and trust in all the parties involved in the shipping process.
With a comprehensive range of services, UPS caters to the needs of both domestic and international markets, offering multiple shipping options designed to meet various delivery requirements.
United States Postal Service (USPS)
Key feature: Most affordable for domestic U.S. deliveries.
USPS is your go-to shipping partner for affordable and reliable delivery in the US. With a widespread network, USPS ensures convenient access for businesses of all sizes and lets you choose from many shipping services like Priority Mail, Ground Advantage, and Priority Mail Express, each offering different speeds and prices to suit your needs and budget.
USPS enables your customers to track shipments online and get real-time updates. It’s an ideal shipping partner for retailers who need a trustworthy and cost-effective carrier without compromising on quality or efficiency.
DHL Shipping
Key feature: Comprehensive customs clearance services.
Originally established in Germany and named after its founders: Dalsey, Hillblom, and Lynn, DHL has gained a solid global presence. The company's reputation is built upon its swift and dependable express shipping services, which set the standard for premium-class customer service in the logistics industry.
DHL also excels in providing comprehensive customs clearance services. This aspect is particularly advantageous for businesses providing international shipping, as DHL simplifies and streamlines the often complex process of navigating customs regulations and procedures.
Federal Express (FedEx)
Key feature: US-centric and enterprise-friendly.
With ‘express’ in its name, FedEx lives up to the expectations by focusing on expedited shipping services. It’s an excellent choice for urgent deliveries – both domestic and international – with offerings designed to meet various urgency levels and budget constraints. FedEx also caters to enterprise businesses via its specialized shipping services such as FedEx Ground for heavier packages and FedEx Freight for large shipments. What’s more, it provides dedicated customer support and assistance for all businesses, ensuring smooth shipping operations.
PostNL
Key feature: Affordable and swift shipping across the EU.
PostNL is a postal service provider based in the Netherlands. Originally founded as TNT Post, the company rebranded to PostNL in 2011. It operates a comprehensive postal network within the Netherlands and offers international mail and parcel delivery solutions across the world and, particularly, Europe.
PostNL plays a significant role in facilitating e-commerce growth in the Netherlands and EU, providing reliable and efficient delivery services for online retailers and consumers alike. The company provides a range of shipping options, including standard and express delivery, as well as tracking and insurance services. It also leverages Magento 2 and the Hyvä theme on its website.
Express Mail Service (EMS)
Key feature: An express alternative to DHL and FedEx for less popular locations.
EMS is an international courier service operated by various postal administrations worldwide. It provides fast and reliable express shipping solutions and efficient delivery options to over 190 countries and territories.
Sporting features like tracking, insurance, and customs clearance assistance, EMS is often a preferred choice for those seeking expedited and secure delivery services from or to less popular locations than the USA and EU. However, if you’re wondering about how to ship products to customers from home, EMS is the only carrier in this list that doesn’t support ‘pickup requests’ and requires sellers to visit a local post office.
Calculating E-commerce Shipping Costs
Your e-commerce shipping table rates are often a key consideration for completing a purchase. Understanding the factors that influence shipping costs can help customers make informed decisions and you – as a seller – optimize your shipping strategies.
Alongside shipping methods and carries, which we’ve discussed above, some other important pricing factors usually are:
Distance
The distance between the point of origin and the destination plays a significant role in determining shipping costs. Longer distances typically incur higher costs due to increased fuel consumption, transportation time, and associated expenses.
Shipping Destinations
In addition to distance, remote or less accessible locations often imply higher costs due to limited transportation options and infrastructure challenges. International shipping involves additional considerations such as customs duties, taxes, and regulations, which can significantly impact costs.
Weight and Size
The weight and dimensions of a package directly impact shipping costs. Heavier and bulkier items require more resources to transport and may incur additional fees. Carriers often use dimensional weight pricing, where they charge based on the package's size rather than its actual weight, to account for space utilization.
Packaging
The type of packaging used can affect shipping costs. Fragile or oversized items may require special packaging materials or additional protective measures, leading to increased expenses. Efficient packaging that maximizes space utilization can help reduce shipping costs.
Seasonal Demand
Shipping costs may fluctuate based on seasonal demand and peak periods like holidays or promotional events. Carriers may request higher fees to manage increased shipping volumes and ensure timely delivery.
Additional Services
Optional services such as insurance, tracking, signature confirmation, and special handling incur extra charges but provide added convenience and security for both shippers and recipients.
Negotiated Rates
Businesses with high shipping volumes may qualify for discounted or negotiated rates with carriers. Leveraging these agreements can help reduce shipping costs and improve overall profitability.
To maintain healthy profit margins while meeting customer expectations, leverage your shipping carrier’s online calculators that estimate shipping costs based on package dimensions, weight, destination, and desired delivery speed. In addition to that, make sure to leverage robust shipping e-commerce software.
E-commerce Shipping Best Practices: Checklist
We’ve only provided a list of best practices for international shipping. Now, as we reach the end of this article, let’s look at the guidelines for successful shipping on the whole. You can treat it as a checklist when you set up or optimize your e-commerce shipping.
- Offer Multiple Shipping Options – As already mentioned, providing various shipping methods will allow your customers to choose the option that best fits their needs. Make sure to offer a choice as wide as possible, enabling standard, expedited, and express delivery.
- Set Clear Shipping Policies – Always clearly communicate shipping policies on a dedicated page. Include times, costs, countries (for international shipping), accepted payment methods, and any shipping restrictions or limitations.
- Invest in Packaging – Invest in both protecting products during transit and enhancing the unboxing experience for customers. Consider eco-friendly packaging options to align with sustainability goals.
- Offer Order Tracking – Provide order tracking for customers to monitor the status of their shipments in real time. Since this will also reduce customer inquiries about order status, try to offer it as a free bonus and not a paid feature.
- Offer Free Shipping Thresholds – Encourage larger MOQ and boost upselling by setting free shipping thresholds that motivate customers to spend more to qualify for free shipping.
- Monitor and Analyze Performance – Regularly monitor shipping performance metrics such as delivery times, shipping costs, and customer satisfaction scores. Use this data to identify areas for improvement and optimize the shipping process further.
Leverage Shipping Software – Shipping applications streamline the shipping process by automating tasks such as label generation, carrier selection, and order tracking.
Benefits of Leveraging Shipping Software
Shipping software is designed to streamline and automate various aspects of the shipping process for businesses. It typically integrates with e-commerce platforms, carrier services, and other logistical systems to facilitate various tasks. Here's what it brings to the table:
Streamlined Automation
Shipping software streamlines numerous time-consuming tasks, from imposing shipping restrictions during order placement to generating shipping labels. This automation not only saves precious time but also minimizes the risk of human error, resulting in fewer shipping mistakes and increased customer satisfaction.
Seamless Integration
Most shipping software seamlessly integrates with popular e-commerce platforms such as Shopify, WooCommerce, and Magento. This integration ensures real-time synchronization of orders, SKU numbers, and shipping information, providing you with the most current data at all times.
Flexible Carrier Options
Shipping software lets you access a wide range of shipping carriers and services. As a result, you can provide the best option for each shipment based on factors such as costs, delivery time, and package size. This flexibility allows you to offer your customers various shipping choices.
Enhanced Order Tracking
Give your customers added reassurance by offering detailed order tracking within your shipping software. With this feature, customers can effortlessly check the exact location of their packages in real time. By providing such transparency, you'll see a decrease in customer inquiries about their orders, resulting in smoother operations and happier customers.
Data-Driven Insights
Leverage robust analytics and reporting features within your shipping software to gain insights into your shipping operations. Monitor key metrics such as shipping costs, delivery dates and times, and customer satisfaction rates to identify areas for improvement and optimize your shipping strategy.
Start Optimizing Your E-commerce Shipping!
Shipping can be a stressful aspect of e-commerce. It’s only natural since the process involves high budgets, responsibility, and vulnerability of relying on your fulfillment partners. Still, as long as you do your research and dip your toes into the shipping realm, you’ll find a lot of companies, solutions, and tools that can support you in effectively fulfilling your orders.
Don’t hesitate to check our guide on specialized shipping software for the Magento e-commerce platform – and see how seemingly simple apps can help you optimize shipping operations, improve customer satisfaction, and reduce internal fulfillment costs.
