The Price of International Competition

International retailers are driving notable changes domestically, with 85% of merchants surveyed reporting adjustments to their shipping strategies to keep up. The appeal of these global players? Low costs and quick delivery offerings that resonate with price-sensitive consumers.

To meet this challenge, 42% of respondents have adopted faster and more affordable shipping options to compete effectively. This response aligns with shifting consumer preferences: 61% of surveyed shoppers who purchase from brands like Temu and Shein cite price as the most critical factor influencing their decision.

Naturally, a third of consumers surveyed are more likely to purchase from a retailer offering better prices over free expedited shipping. 

Beyond Cost: The Expedited Shipping Advantage

While price remains a dominant factor, convenience is closing in as a key differentiator. Nearly half of consumers surveyed say they would choose international retailers over domestic giants like Amazon or Target if free expedited shipping were universally available.

This highlights a growing expectation for not only competitive pricing but also seamless and speedy delivery experiences. A considerable 63% of merchants surveyed feel pressured to offer faster delivery, with 25% feeling compelled to provide it at no additional cost.

Moreover, while 43% of consumers surveyed receive their online orders within two days on average, even more expect this to be the norm. In contrast, only 18% of consumers surveyed feel that two-day shipping is unnecessary.  

Key Takeaways for U.S. Merchants

These insights underscore several main takeaways for merchants, including:

• Price remains crucial: Price remains a primary factor in purchasing decisions. However, delivery speed is a compelling element in closing sales and boosting customer retention. 
• Two-day shipping is the new standard: Consumers now expect two-day shipping, which has significantly influenced their purchasing behavior and loyalty toward certain retailers. 

• Demand varies by product type: The urgency for expedited shipping varies based on product type and customer needs. High-demand items like apparel and health and wellness often require faster delivery, while less vital items like home goods may allow for more flexible timelines. 

• Offering diverse shipping options is key: Merchants should provide a range of shipping options, allowing customers to choose what suits their needs best.

Strategies for Succeeding Globally

To thrive in this rapidly evolving market, merchants must develop proactive strategies to differentiate themselves. Some key areas of focus include:

• Enhancing logistics efficiencies: Using real-time data analytics, investing in supply chain visibility, and partnering with reliable third-party providers are a few ways to reduce costs and improve delivery times.
• Rethinking pricing structures: Finding a balance between price and sustainable margins, such as choosing which shipping methods to subsidize.
• Prioritizing sustainability: Addressing the environmental impacts of increased shipping and positioning the business as an eco-conscious brand.

Affordability + Speed = Happy Customers

Consumers are increasingly demanding faster and more affordable shipping options. As international businesses rise to meet these changing preferences, U.S. merchants must adapt their strategies to remain competitive. This includes optimizing logistics, refining pricing models, and prioritizing expedited shipping. By prioritizing cost and speed, merchants can navigate this dynamic market and secure their position in the global eCommerce arena.