The major carriers have announced price increases for early 2016 but the holiday season is still expected to be a buyer’s market. Major retailers will again offer free shipping deals, free returns, and easy in-store pickup for those seeking that option.
Target will cut in half its minimum purchase to qualify for free shipping to $25, and Best Buy recently announced it has waived its $35 free shipping threshold through January. Toys R Us is another big holiday retailer slashing its minimum threshold. Walmart is keeping its free shipping threshold at $50, but hopes to boost online another way with a new mobile check-in feature on its smartphone app. Shoppers who have placed orders in advance for in-store pickup can check in as soon as they enter the store, alerting employees to get orders ready and speed the process along.
And in a further effort to stand out in the online shopping battles, some retailers are extending their “free’ offering to returns, including both Target and Best Buy. Even PayPal is getting in on the action. The payment service said it will reimburse its U.S. customers' shipping costs for up to four returns of items purchased during the holidays.
However, a small hangover may await consumers after the holidays. FedEx and UPS announced they will raise list prices by about 5 percent on average in early January. Both companies have also raised their fuel surcharges, despite the plummeting price of diesel fuel. And the Postal Service has proposed a January increase in its competitive products, including a 9.8 percent hike on Priority Mail. Commercial customers that send lightweight parcels under the Parcel Select service will see a whopping 23.5 percent increase on average.
At some point, online retailers will have to pass some of those costs on to customers. But few experts expect free shipping to disappear completely. Too many consumers now simply expect it when they order online, at least for orders of a certain amount or type. Still, retailers will look to recoup increased shipping costs somewhere, possibly baking them into the price of products.
Will you shop online this holiday season? How important is free shipping to you? Do you see your shipping habits changing if retailers pass on the increase in shipping costs to consumers?