Amazon is shipping stuff for free — for all customers.
Amazon said Monday that it will start offering free shipping with no minimum $25 purchase to all U.S. customers throughout the holiday season. Previously, only subscribers to Amazon Prime, which pay $119 per year, were eligible for free shipping.
The announcement comes days after Target TGT, +1.11% began its free holiday shipping program and marks the start of the holiday season free shipping offers by retailers. (Amazon did not immediately respond to request for comment.)
Consumer Intelligence Research Partners released a report last year that found the estimated 100 million-plus U.S.-based Amazon Prime AMZN, -2.27% users spend $1,300 per year on purchases on the site, more than double the $700 for non-Prime members. That may be because Prime members can afford to pay $119 per year for membership, but also like to shop when they know they don’t have to pay for shipping.
Free shipping is a big incentive for click-happy consumers. Nine out of 10 people said free shipping was the No. 1 reason for shopping online more often.
Free shipping is a big incentive for click-happy consumers. Nine out of 10 people said free shipping was the No. 1 reason for shopping online more often, according to the Walker Sands Future of Retail Report. And roughly half said they felt same-day shipping was a reason for shopping more online.
What’s more, another study by marketing company Retention Science concluded that people actually choose free shipping over a dollar discount. They may see it as a more lucrative perk and it makes their online shopping experience more seamless, just like “one-click” shopping.
Of course, it works both ways. People who only intend on spending a few dollars may have been tempted to buy more things to bring their final tally to $25 in order to qualify for free shipping. With no minimum requirement, those shoppers won’t have to pay extra to ship purchases below $25.
Tom Caporaso, CEO of Clarus Commerce, a company that works with companies on premium loyalty programs, summed up the power of free shipping as something that “combines the power of satisfying a universal want (something for nothing) with the power of satisfying a universal demand (free deliveries).”
In other words, free shipping has an appeal that dollar discounts don’t have: Amazon’s latest bid for more customers contains the word “free.”
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