eBay's Fast N Free Program is starting to ramp significantly for consumers (and sellers)
In October of 2011, eBay quietly introduced a pilot program for a shipping improvement called Fast N Free. The program didn't get much buzz with sellers or buyers in it's initial roll out. However in the last month or two, we've seen a strong uptick from sellers increasingly interested in the program. They are interested because items that are in the program are converting substantially higher than those that are not. How much? Stay tuned we have some exciting new data on the program in this post!
Throughout this post, I'll refer to the program by the FNF acronym to save my fingers some work and also keep from slipping up and calling it Fast N Furious, which I have done in many meetings lately ;-)
In addition to seller questions, we're getting a lot of folks on Wall St. wanting to know more around why we are seeing eBay's SSS increase. I generally say that there's no specific silver-bullet, but eBay has 5-10 programs that are contributing to a better buyer experience. FNF is a great example of that type of a program.
So we're going to take a deep dive into FNF covering:
- Why is FNF hitting the radar now?
- The FNF Buyer experience
- The FNF Seller experience
- 6 tips to increase your FNF sales
- Conclusion - where we think eBay should go with the program
Why is FNF hitting the radar now?
Before jumping into the buyer and seller experience of FNF, you are probably wondering why we are talking about a program that essentially a year old and under the radar.
We asked Michael Jones, VP of Merchant Development at eBay: "Why are sellers suddenly getting excited about this program?" and he shared these stats on the program (all stats from Q2 2012):
- 12.7m - FNF transactions.
- 6.5m - unique FNF buyers.
- 140k - average daily number of FNF transactions
- 10% of the items viewed are FNF eligible - this is up from 1% items viewed FNF eligible in Holiday 2011
As you can see buyers are voting YES for the program with their wallets, which always gets sellers' attention.
The next section reviews the buyer experience so you can see why buyers are really eating up FNF.
FNF Buyer Experience
When you shop at most online retailers, you have a good bit of clarity around the cost of shipping and estimated arrival times. eBay has been focused on free shipping over the last years and now with FNF is adding a lot of clarity around the arrival time aspect of buying on eBay and the program highlights those items that are not only free, but fast (arriving in 4 days or less).
As a buyer, you don't see FNF until you get into a listing (it's not integrated/visible in search results). You will notice a green truck, the Fast N Free green text, and finally an unusually specific delivery time in the "Delivery" section of the listing. In the following figure, you can see an example. The red box was added by me to highlight the FNF part of the listing.
When the consumer hovers over the little question mark, this further messaging is provided:
To summarize the buyer experience, prior to going to the listing, the free shipping was highlighted, and this FNF messaging in the listing adds the details that not only is it free, but it is fast (in this case 3-4 days).
Ok, I'm a seller, how do I take advantage of this program?
FNF Seller Experience
One of the nice things about the FNF program is that as a seller there really isn't anything above and beyond what you are already doing that you need to do to benefit from the program. eBay has made two changes that have increased the number of items that are qualifying for the program:
- In the Spring release, they raised the eTRS shipping bar requiring tracking, faster 'time to ship' and uploading of tracking info. This gave eBay a lot more data to put into the program. Without tracking info, there's no way to for the algorithm to know that when you ship from zipcode X to Y it takes Z days.
- In the Fall release, eBay is releasing (September timeframe) a dashboard for FNF that will give sellers move visibility into how many of their items are qualifying. This will 'close the loop' and allow those sellers that really want to be in the program the ability to get FNF qualified for more of their items.
One question we get a lot is: "If eBay tells buyers my item will be there in 4 days, what happens if it takes > 4?" The good news is that eBay will protect you in this situation and give you an automatic 5-star on your shipping time DSR, even if your item doesn't arrive as they have anticipated. This dramatically reduces any risk from the program. That being said, we do occasionally have sellers that do not want their items in the program and there is an account-wide setting that you can use to block your items from the program if you really want to (not our recommendation).
6 tips to increase your FNF sales
We've been getting a lot of questions from sellers about the program, so hopefully we've addressed the fundamentals of how it works. Here are six tips to increase your FNF coverage (and sales):
- Free shipping is a must and has the benefits of improving your BestMatch score, DSRs, etc.
- Make sure to follow the Top Rated Seller requirements around time-to-ship, tracking information, etc.
- Make your standard shipping method, one that gets a package to the majority of the continental US in 4 days or less (USPS Prio, FedEX, UPS, etc.)
- Listings with 1 day handling automatically qualify
- Starting September 24th, the dashboard will be available - definitely check that out.
- Some of our customers are starting to consider some warehouse and shipping provider changes. You may want to consider something in the mid-West that is more central, or some of our customers with warehouses on the East/West coasts are exploring multi-warehouse type opportunities. Also consider moving your top sellers to fedex/ups shipping.
4 days is great, three days is better, two days - even better! We would like to see eBay use this program to continue to raise the bar on shipping. Amazon is conditioning consumers that 2 day free shipping is the norm and one day is a relatively inexpensive upgrade. Of course, we've long pointed out that eBay passes the costs of these programs onto sellers. We'd love to see some more sophisticated fee discounts for sellers to help defer the costs that this level of service are sure to generate.
As we point out in our SSS data, eBay is doing a lot of things right and this program is a great example. On its own, it is a small needle mover, but with several of the other programs eBay is executing well on, it really is adding up to a better experience for buyers.
We strongly recommend sellers look at embracing this program for Holiday 2012 and thinking long-term about the implications of a new eBay standard of 4-day shipping going to 2-day shipping.
ChannelAdvisor and FNF
For those readers that are customers, we are already doing everything to help you get FNF coverage:
- Automating postings to eBay
- Order management and routing to top shippers
- Uploading of tracking
- Integration with top CRM systems to make sure you are monitoring consumer issues.
As eBay rolls out the dashboard, we'll look at ways we can innovate and help you grow your sales around the program. If you have any questions, feel free to contact us via ssc.channeladvisor.com
SeekingAlpha disclosure- I am long Google and Amazon. eBay is an investor in ChannelAdvisor where I am CEO.