Two weeks ago, we started working with a ecommerce jewelry client. As our standard process, we dedicate roughly 2 weeks to run proper tests to identify the audiences that have the most interest / purchase potential.

For this brand, after a few days of testing and $560 of ad spend, the soft stats are looking great. CTR is high at 2%-3% on cold audience, 25 add to carts worth $8,590, 14 initiate checkouts worth $2,630, a 56% flow from add to cart to initiate checkout which is not bad at all - but here's the bottleneck - just 1 purchase worth $288 (a dismal 7% conversion rate!)

As I have said, the first 2 weeks are dedicated to testing and I normally wouldn't mind not getting purchases for as long as we're getting a lot of interest to the product / page - testing creatives and offer is phase 2 any way.

In this case, however, we are getting a GREAT amount of interest off the bat, but people are not buying.

Sometimes, it is not your funnel or campaign's fault and you have to look at the entire purchase journey.

Why are they adding to cart, initiating the checkout but not purchasing? The funnel flow looks great until the last step.

Often, it has a lot to do with the discovery of a final hidden cost up until checkout.

So I looked at their shipping policy.

Free shipping for orders $200 and up.... And that's for a product with an average order value of $150.

See, the thing is, Amazon has acclimated us to believe that we DESERVE free shipping, especially if you are paying $150 for a product!

Yes. A person is willing to pay $150 for a product, BUT, abandons the idea the moment they see that shipping cost is $7.

You lose $150 worth of sale because of a standard $7.
So, to test this theory, I encouraged client to lower down their shipping threshold. They agreed to decrease it to Free Shipping on orders $100 and up, making it lower than the average order value of $150.
The results?

Check out this amazing flow - 55% of those who added to cart initiate checkout, AND 62% of those who initiated checkout eventually made a purchase (a huge jump from the initial 7%!)

.... All because of shipping.

Our overall return on ad spend sits at 2.44x in just 2 weeks! During the BIGGEST, most toughest shopping season of the year where everyone and their grandma are launching Facebook ads.

We're now aggressively scaling this pup just in time for Black Friday.

Moral of the story: Make sure your shipping policy makes sense.

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The Importance of Shipping / Troubleshooting an Ecommerce Funnel