Free shipping is one of the most powerful incentives in eCommerce — but how do you offer it without eating into your profits?

According to a report by Statista, 73% of consumers said free shipping is what they value most when shopping online. Yet, many Shopify store owners fear that offering free shipping means taking a loss. The good news? You can offer free shipping on Shopify strategically — and boost conversions, average order value (AOV), and customer loyalty while maintaining healthy profit margins.

In this guide, we'll break down how to offer free shipping without hurting profits, backed by data and actionable strategies you can implement today.

Why Free Shipping Matters for Your Shopify Store

Before diving into the how, let’s understand the why.

Key Stats That Prove Free Shipping Drives Sales:

• 93% of consumers are more likely to buy if free shipping is offered (National Retail Federation).

• 58% of abandoned carts are due to unexpected shipping costs (Baymard Institute).

• Shopify stores that offer free shipping can see a 10–20% increase in conversion rates.

Offering free shipping reduces friction in the buying journey, helps you stay competitive, and increases customer satisfaction.

6 Smart Ways to Offer Free Shipping Without Losing Money

1. Set a Minimum Order Threshold

Why it works: Encourages customers to spend more.

Example: Offer “Free shipping on orders over $50”.

This strategy increases your AOV while ensuring shipping costs are absorbed by higher margin sales.

How to set your threshold:

• Analyze your current AOV (found in Shopify Analytics)

• Set your free shipping threshold 10–30% above your AOV

• Ensure your profit margins can support the shipping costs

Example: If your AOV is $42, set free shipping at $60.

2. Bundle Products to Offset Shipping Costs

Offer curated product bundles that include free shipping.

Why it works:

• Bundles increase overall sales per order

• Higher-value transactions justify offering free shipping

• Simplifies logistics with fewer packages

Example: “Buy 2 skincare kits, get free shipping + 10% off.”

3. Include Shipping Cost in Product Pricing

Raise your product prices slightly to absorb the shipping cost.

Formula:

Product Price = Product Cost + Desired Profit + Estimated Shipping Cost

Pros:

• Keeps checkout experience seamless

• Perceived value remains high if done right

Make sure competitors' pricing stays comparable even with the adjustment.

4. Offer Free Shipping to Specific Locations Only

Instead of global free shipping, limit it to key markets where shipping is affordable.

Action Steps:

• Use Shopify’s Shipping Profiles to segment zones

• Offer free shipping in your domestic market (e.g., US or UK)

• Provide flat or real-time rates internationally

This minimizes risk while still offering free shipping to a majority of customers.

5. Use Shopify Shipping Discounts

Shopify offers up to 88% off shipping rates with carriers like USPS, UPS, and DHL.

How to apply:

• Activate Shopify Shipping in your dashboard

• Compare discounted rates

• Pass on savings to offer free or subsidized shipping

Tip: Use Shopify’s “Carrier Calculated Shipping” for real-time cost accuracy.

6. Create Time-Limited Free Shipping Campaigns

Use urgency to drive quick sales without making free shipping your default.

Example Campaigns:

• “48-Hour Free Shipping Sale”

• “Free Shipping Weekend on All Orders!”

Promote these via email, SMS, and popups on your site.

Psychological benefits: Creates urgency and scarcity while allowing you to control the offer.

Optimize Your Shopify Store for Free Shipping Success

It’s not just about the offer — your store design and marketing must support it.

Display Free Shipping Prominently

• Use announcement bars (Shopify apps like Quick Announcement Bar)

• Mention free shipping on product pages

• Highlight it in checkout banners

Upsell with Cart Value Progress Bars

Use apps like Ultimate Special Offers or Honeycomb Upsell to show how close a customer is to unlocking free shipping.

“Only $10 away from Free Shipping!” can increase AOV by 15–20%.

Optimize Product Margins

• Negotiate better supplier rates

• Reduce packaging weight

• Switch to lighter/flat shipping methods

Marketing Strategies to Promote Free Shipping

Free shipping is a conversion booster, but only if people know about it.

Use Email Marketing

• Promote free shipping in abandoned cart emails

• Send time-sensitive free shipping offers to segmented lists

Leverage Social Media

• Create reels or stories featuring products with free shipping

• Use hashtags like #freeshipping, #shopnow, and #limitedoffer

Run Retargeting Ads

• Use Facebook and Google ads to remind past visitors of your free shipping offers

• Emphasize time-sensitive promotions

Case Study Example

Store: GreenGlow Naturals (Skincare Brand)
Problem: Low conversion rates due to shipping fees.
Solution: Added “Free shipping on orders $55+” and used a cart progress bar.
Results:

• 23% increase in AOV

• 18% boost in conversions

• Reduced cart abandonment by 12%