Free shipping search test results – Free Shipping Episode II

June 10, 2009

Digital Marketing ChannelAdvisor By ChannelAdvisor

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