Every Day Is Free Shipping Day -- Now, How About Free Returns?

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Free returns dayMonday was Free Shipping Day. So is Tuesday. And the day after that will be Free Shipping Day, too.

OK, not exactly. Free Shipping Day is officially Dec. 17, and for good reason: that's the last day many online retailers can guarantee Christmas Eve delivery with their ground shipping option -- which is typically what you're getting when you're offered free shipping. In addition to encouraging consumers to finish their online shopping, Free Shipping Day is also a big promotional opportunity, with many sites lowering or eliminating their minimum purchase requirements for free shipping.

That last bit is key: Most of the participating retailers were already offering a way to get free shipping, albeit with a minimum purchase threshold in place. That wasn't always the case. In the first quarter of 2009, 37% of online transactions shipped for free, according to ComScore; by the last quarter of 2011, that figure had jumped to 52%. According to recent research from Deloitte, 71 percent of consumers prefer retailers that offer free shipping.

So if a free shipping option is something consumers have come to expect, what can online retailers do now to capture customers' attention?

They might try offering customers the option to return their purchases without paying for return shipping. Deloitte's research also found 56% of people would rather shop at a retailer that offered totally free returns, and it's easy to see why: If you don't have to pay to ship it and you can return it for free, then you can feel free to buy merchandise sight unseen and untried-on, knowing that if you don't like it, you'll get 100% of your money back.

This is exactly the deal offered by some shoe and apparel retailers, including Zappos and Ugg Australia. But these retailers are the exception rather than the rule: The section of FreeShipping.org dedicated to stores with free return shipping only lists about 30 sites. And FreeShipping.org founder Luke Knowles says he doesn't expect many more retailers to jump on board.

"I don't see everybody offering it at some point," he says. "It was necessary for shoe companies, but I don't see Lowes and Home Depot offering it."

Deloitte retail analyst Alison Paul is measured in her outlook: "I think free returns will expand, but I think more slowly [than free shipping]," she says. "This is a margin erosion issue for retailers."

So for now your options are fairly limited for free returns. You can order from one of the handful of sites listed on FreeShipping.org, which are largely limited to shoe and apparel sites. You can buy something from the eligible categories on Amazon, which are likewise limited to shoe, apparel and accessory categories (Amazon also offers free returns on TVs). You can buy from the website of a bricks-and-mortar retailer, most of which let you return online purchases to their retail locations. Or you can pay for a subscription to ShopRunner, which offers free shipping and returns from a variety of retail sites.

It's unclear if these options for free returns will expand significantly in the foreseeable future. In the meantime, you can take solace in the fact that free shipping is easier to find than ever.



Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.

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