Tags: Shoppers | Pay | Free | Shipping

Experts: Shoppers End Up Paying More for Free Shipping

By    |   Wednesday, 30 Nov 2011 11:56 AM

Free shipping is often a dealmaker or dealbreaker with online sales. More retailers have realized this and will extend the offer. But, Smart Money warns that consumers should be on the lookout for the catch: they have to spend more.

"What many consumers don't realize is that retailers often build the cost of this kind of promotion into their holiday budgets months in advance," National Retail Federation spokesperson Kathy Grannis writes on the group's blog, US News reports.

"So while the service isn't 'free' for retailers, it's something they know their valued shoppers look for when calculating the cost of gift-giving each holiday season, and this year, nine out of 10 plan to put
the offer to good use," she added.

Given the economic conditions, it's little surprise that shoppers are looking for bargains wherever they can find them. Shipping and handling can often add significant costs to a purchase and when retailers waive these fees it provides shoppers with an incentive to spend.

But, a growing number of retailers have come up with a strategy to make free shipping a little less free for consumers and to nudge them to spend even more — minimum purchase requirements.

Instead of offering free shipping on all purchases many retailers only extend the offer once a customer's bill reaches a certain amount.

And minimum purchases aren't the only trick some retailers are employing.

Consumers often fixate on shipping and handling costs and will jump at the opportunity to eliminate them, which may require them to enter a coupon code. However, some retailers only accept one code, meaning consumers may lose the opportunity to use other coupons that may be more advantageous.

Shoppers best defense is to look at overall deals and not just the shipping fee, Dan de Grandpre, founder of sale-tracking site DealNews.com told Smart Money.

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Free shipping is often a dealmaker or dealbreaker with online sales. More retailers have realized this and will extend the offer. But, Smart Money warns that consumers should be on the lookout for the catch: they have to spend more. What many consumers don't realize is...
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Wednesday, 30 Nov 2011 11:56 AM
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