Still, product inflation and soaring shipping costs are making the service unsustainable as the prospect of recession threatens to wallop already-flagging online spending.Īmazon marketed free shipping as a differentiator and used pricey Prime subscriptions and fat profits from other businesses to underwrite its package delivery costs - forcing other retailers to follow, even if they lacked Amazon's advantages. It is an open secret that most retailers raise product prices to subsidize free shipping. Retailers are beginning to look more like some airlines, which charge for better seating, transporting luggage and also restrict use of frequent flyer points, Morris said. 'The days of free delivery are numbered,' Ken Morris, managing partner at Cambridge Retail Advisors, said of the fast-changing retail marketing tool. They are adding fees for faster service, raising minimum purchase requirements and making other changes that shift more costs to consumers who are struggling with financial issues of their own. LOS ANGELES, March 24 (Reuters) - There is no such thing as free shipping.Įven so, Inc (AMZN.O) and other online retailers who use so-called free delivery to cultivate customer loyalty are scrambling to keep it from draining profits as costs climb and e-commerce contracts.

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