Free Shipping vs. First Order Discount: Which Converts Better?

Free shipping thresholds and first order discounts are both proven conversion boosters, but free shipping typically has a bigger impact—especially when shipping costs are a late-stage barrier. Free shipping not only lifts conversion rates but also increases average order value (AOV), while first order discounts tend to drive fast, deal-seeking purchases rather than long-term, repeat buyers.

Conversion Rate Impact: Free Shipping vs. First Order Discount

  • Free Shipping Threshold: Lifts conversion by 7–20%+ and increases AOV by 10–30%. Works best for reducing cart abandonment and encouraging shoppers to “top up” their order to hit the free shipping mark.
  • First Order Discount: Boosts conversion 15–25% over baseline, but typically attracts price-sensitive buyers. Has little or no impact on order size and may lower margins.

Psychological Drivers

  • Free Shipping: Removes the “extra fee” pain point, simplifying the decision at checkout and feeling more valuable than a small discount. Shoppers will often add extra items just to qualify.
  • First Order Discount: Creates urgency and gets deal-seekers to buy now, but can train shoppers to expect discounts and potentially lower your brand’s perceived value over time.

Strategic Considerations

  • Free shipping works best for boosting conversion and order size, especially with repeat or returning shoppers.
  • First order discounts are ideal for rapid growth and customer acquisition, but can erode margins if used too broadly and don’t always drive repeat sales.
  • Test both with your own catalog, price points, and audience—results vary based on margin, AOV, and customer segment.

For newcomers:
Free shipping thresholds usually win for conversion and bigger baskets; first order discounts can drive quick wins but often bring in more bargain-hunters than loyal fans. Try both, measure the results, and pick the strategy that matches your goals and profit margins.

  • Free Shipping
  • First Order Discount
  • Conversion Rate Optimization
  • Average Order Value (AOV)
  • Cart Abandonment
  • Ecommerce Strategy
  • Deal Seekers
  • Impulse Buys
  • Profit Margins
  • Retention
  • Acquisition
  • Behavioral Triggers
  • Checkout Optimization
  • Pricing Psychology
  • Shipping Fees
  • Loyalty
  • Discounting Strategy
  • Threshold Offers
  • Sales Promotions
  • Ecommerce Best Practices