The shopper should be rewarded for spending more during their shopping session. Never mind the cost of gas and the time they save. Online shoppers are becoming more intelligent every time they make a purchase. However, most are not in this category. Since e-tailers have problems employing a practical shipping model that satisfies online shoppers, many have decided to offer it free as an incentive.
Free shipping can be the difference in acquiring a new customer or ultimately making a sale.
As attractive as it might seem initially, shipping for free is ultimately a lose-lose situation. It either inflates the cost of customer acquisition or is translated to the customer through the ticket price on each item. One might have thought that online merchants learned their lesson after the first wildly successful holiday online shopping season in 1998. However, back-end problems involving fulfillment and shipping continue to this day. After two years of online shopping with varied results, shoppers are far more savvy about doing business online.