Highlights This study examines how consumers evaluate and respond to threshold free shipping (TFS) policy. A piece-based TFS results in a higher intention to shop than a dollar-based TFS. The effect of TFS is attenuated when the shipping charge information is present. When the duration for a promotion is short, the effect of TFS is diminished. Offer evaluation mediates the effect of TFS policy on intention to shop.

    Abstract This study examines how consumers evaluate and respond to two economically equivalent but different forms of threshold free shipping (TFS) policy: piece-based or dollar-based (e.g., Regular: $25; free shipping on orders of “4 items” as opposed to “$100”) offered by an online store. We first demonstrate that a piece-based TFS will result in a higher intention to shop than a dollar-based TFS. However, this effect is attenuated when information about the shipping charge is present (e.g., “$4.99 flat rate shipping. Free shipping on orders of ___”) or when the time restriction for the TFS policy is short (e.g., “today only”). Finally, the effect of the TFS policy on intention to shop is shown to be mediated by the consumer’s evaluation of the offer. The observations have important implications for internet retailers.


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    Title :

    Threshold free shipping policies for internet shoppers


    Contributors:


    Publication date :

    2015-09-29


    Size :

    11 pages




    Type of media :

    Article (Journal)


    Type of material :

    Electronic Resource


    Language :

    English




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