There was a time, not too long ago, when retail industry analysts were predicting that online merchandisers would soon stop offering free shipping on orders. How wrong they were.
Most recently, Target Corp. has thrown its hat into the free-shipping ring, offering the perk for all holiday orders. The announcement came just a few weeks before the beginning of the Christmas shopping season, suggesting a last-minute change of heart by the old-line retailer. (Or perhaps an acknowledgment of reality.)
Whether any of those merchants can afford to absorb the cost of free shipping is another question entirely. (Amazon, of course, has shown itself willing to operate for years without turning a profit.) But they seem convinced that the consumer won’t settle for anything less.
“It’s pretty basic,” says Tom Racciatti, senior manager of the supply chain practice of West Monroe Partners. “They’re doing this to drive volume.”
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