Offering free shipping is something that’s becoming more common, and almost expected by many customers. Even though it’s not always possible to offer free shipping, most Etsy sellers worry about whether they should offer the Free Shipping Guarantee because Etsy has said that it helps with search placement.
But do you really have to offer free shipping or the Free Shipping Guarantee?
Offering free shipping on Etsy is not required, and it might not make financial sense depending on the cost to ship your products or the location of your business. However, customers do respond well to free shipping in general, so it is something that you might want to consider. This can be through the Etsy Free Shipping Guarantee, or by including free shipping on an item level.
Even though you don’t have to offer free shipping to sell on Etsy, there are reasons why you might want to. Read on for some things to consider when you’re making the decision.
Table of Contents
- How to offer free shipping on Etsy.
- Does free shipping help your search placement on Etsy?
- Why is the Etsy Free Shipping Guarantee $35?
- Do I need to use the Free Shipping Guarantee to help in Etsy search?
- Should I offer free shipping on individual items on Etsy?
How to offer free shipping on Etsy.
To offer free shipping on Etsy, you can either price each item individually to ship free or not, or you can use the Etsy Free Shipping Guarantee that gives free shipping to any order that’s $35 or over. Each option works differently, but both methods work to give you the slight search placement boost that goes with free shipping.
To offer free shipping on an item level, you would need to calculate the average cost to ship the item, then add it to the price of the item so that you don’t end up losing money by paying for shipping out of your own pocket.
A lot of Etsy sellers have argued that saying the shipping is free when you’re adding the cost into the listing price is deceptive, but any reasonable person knows that when something ships “free” it’s not really free.
Saying that shipping is free just means that there won’t be additional charges at checkout, which is the benefit to the customer as they decide whether they want to pay for the item itself. Without unexpected extra charges at checkout, they can make a better decision about whether the cost of an item is what they’re able to pay for it.
To offer free shipping through the Etsy Free Shipping Guarantee, which gives free shipping to US customers, you need to go to your Etsy dashboard, click on Settings, then Shipping Settings, and choose the Free Shipping Guarantee tab. Follow the prompts to set up the guarantee, which will then be active store-wide.
Setting up a free shipping offer for a different amount through the sales and coupons tab in the marketing section will NOT give you a benefit for Etsy search, it has to be through the $35 and up guarantee.
Does free shipping help your search placement on Etsy?
Etsy uses whether an item ships free, or whether the Free Shipping Guarantee is turned on in a shop, as part of the search placement algorithm, so having free shipping does help your search placement to a certain extent. How much it helps is up for debate, since Etsy doesn’t say how much each factor is considered as far as search placement goes.
From what I can see, Etsy tends to prefer that items ship free, but it’s not the determining factor in search placement.
The number of sales an item has seems to outweigh whether it ships for free or not, and the same goes for the Free Shipping Guarantee.
If adding the cost of shipping to the price of the item will make the item too expensive for the general pricing in that category, it might not be worthwhile to offer free shipping on an item level. Turning the Free Shipping Guarantee on might make more sense since it may encourage people to buy more to get to the $35 order amount.
The Free Shipping Guarantee isn’t perfect, though, so let’s look at that.
Why is the Etsy Free Shipping Guarantee $35?
The Etsy Free Shipping Guarantee was designed to encourage customers to spend more than the average order value on Etsy in order to reach the breaking point where free shipping is offered. Etsy did market research and determined that $35 was the price point at which people tended to spend more to get the free shipping included, so that’s why it’s set at that amount.
$35 might not work for all shops, however. If your items are on the higher-priced side, or if your shipping costs are higher because of the size or weight, $35 might not give you enough room to maintain a profit.
The problem with the $35 limit is that you can’t turn the guarantee on for certain items in your shop and exclude others, it’s an all-or-nothing thing.
What I was running into when I had the guarantee turned on was that people would buy something that was close to the limit, then buy something lower-priced in order to get above the $35 and to get free shipping. Since that meant I had to absorb a shipping cost for the larger item, it was really eating into my profits.
Other sellers have experienced the same thing, because it’s a natural thing for customers to do. I know that when I buy something and I’m close to the limit for an offer, I’ll do it, so why wouldn’t other people?
Knowing that, you’ll need to decide for yourself whether a $35 limit is worth it for you. If it isn’t, you can always offer free shipping in a different way.
Do I need to use the Free Shipping Guarantee to help in Etsy search?
You do not need to use the Free Shipping Guarantee to get the extra search placement boost. Offering free shipping on an individual item level also gives you the same slight boost in search placement. If your product pricing or shipping costs make the guarantee unworkable in your shop, you can offer free shipping on some items and leave it off of others.
This video goes over some of the reasons why I turned off the Free Shipping Guarantee in my shop, and why it didn’t matter as much as Etsy made it seem like it would.
(What’s more important than getting the tiny boost in search with the guarantee is making sure that you’re making a profit on your sales, and the free shipping guarantee can really mess that up.)
Also, when Etsy first implemented the guarantee, they said that listings that shipped free or that had the guarantee would appear higher in search, but they quickly backed off of that statement because it lowered the conversion rate across Etsy.
Listings that were lower quality but that shipped for free were taking over the search results, and Etsy realized that free shipping wasn’t the best qualification for being on the first page of search.
So having the Free Shipping Guarantee is NOT a promise that your listing will appear higher in search. Plus, if everyone in your category offers free shipping or the guarantee, the playing field is level, and you’re back to the beginning.
Should I offer free shipping on individual items on Etsy?
Offering free shipping on individual items on Etsy is usually a better way to control your costs than having the Free Shipping Guarantee. By adding the cost of shipping, or a partial cost, into the item price, you can cover the cost of shipping and potentially make more profit if a customer purchases multiple items. It’s a better way to cover the shipping than the Free Shipping Guarantee because you have more control over it.
If you offer free shipping on some items and not on others, you’ll be able to take special circumstances into account.
For example, the cost of shipping something that weighs more than a pound in the US can vary a lot depending on how far it’s going. If I have something that could have a $4 to $6 difference based on location, I can either add the higher cost to the item price, or add a partial amount in if my customers tended to buy more than one thing at a time.
By covering your costs this way, you won’t have to worry that you’ll be hit with an unexpected shipping label that can cost more than your profit on the sale.
You can also choose to not offer free shipping if you have things that are going to have different costs to ship. If you use calculated shipping for those items, the customer will pay the exact amount that it costs to ship the product.
(Some countries don’t have a calculated shipping option available, but if you do, you should definitely use it.)
I offer free shipping on things that are really light, and that I can easily estimate the shipping cost. For things that are heavier, and that will cost more if people buy more than one thing, I use calculated shipping.
I’ve also done tests where I added the cost of shipping into the item cost and offered free shipping to see which worked better. Because my items are lower-prices, adding the shipping in made them seem more expensive, so it didn’t matter for me.
I went back to charging shipping on those things on Etsy and it hasn’t slowed my sales down at all.
Taking the final price of the item into account will be important if you do add the cost of shipping into the listing price.
On one hand, you don’t want to price yourself out of the market for your category.
On the other hand, if your items ship free but other people in your category don’t offer free shipping, that can make your products more attractive to customers.
It can take some experimenting to find out what works best. Don’t be afraid to try out different shipping strategies to see what works best for your products and audience.
But no matter what you decide, make sure that you’re looking at your profit to make sure that you’re not eating into it in order to offer free shipping!
This article looks at the confusing revenue reporting on Etsy in the stats section and other sections where you can find financial info.
Opening an Etsy shop isn't difficult, it's making your first sales that gets tricky! But once you decide what you're going to sell, you can get started selling on Etsy by opening a shop and listing...