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MasterCard begins to offer free shipping options to customers

December 1, 2013

More service providers and retailers are beginning to learn that offering free shipping options to their customers at the online point of sale terminal is a necessity.

More service providers and retailers are beginning to learn that offering free shipping options to their customers at the online point of sale terminal is a necessity. 

AllThingsD reported that MasterCard had begun to offer online shoppers a promotion that would allow card users to receive free shipping from a number of different e-commerce outlets. The company is hoping to turn consumer preference for free shipping into an increase in the amount of individuals using its cards at credit card payment processing terminals. 

The importance of offering free shipping this holiday season
The same news outlet had previously reported the results of a Forrester study analyzing the importance of free shipping promotions with online shoppers. That firm found that many consumers will actually leave an e-commerce site if they aren’t offered that perk at the credit card payment processing checkout page. U.S. shoppers identified a lack of free shipping as the second most common reason they chose not to buy a product at an online store, ranking only behind price. 

The report then went on to note that Google Shopping applications now allow users to sort search results to exclude any retailers who do not offer free shipping promotions at their webpage, according to AllThingsD. However, one other factor was mentioned about free shipping options – consumers often find themselves purchasing more than they had originally intended to in order to reach the transaction limits required to receive the perk.

Many brands begin to offer the perk
AllThingsD’s report then went on to note that many other major brands had begun incorporating free shipping options into their promotions recently. PayPal had recently paired with eBay to give free two-day shipping to customers through a number of different retailers.

The report also noted that Visa had begun offering a large number of holiday discounts to its customers, with many of them revolving around the availability of free shipping opportunities. 

Anant Nambiar, group head of global debit product management at MasterCard, told AllThingsD that free shipping options can put a major financial burden on e-commerce providers. However, she also suggested that the risk may be worth the return. 

“It’s going to be hard for many merchants to individually fund free-shipping programs on their own,” Nambiar told AllThingsD. “At the same time, it’s going to be hard to not offer it at all.”

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