Peak Design sees wild ass savings in shipping costs, plus increases in AOV and revenue, by testing a shipping threshold.

The challenge

Shipping is becoming increasingly expensive, and analysis revealed Peak Design was losing considerable money on free shipping in the United States.

www.peakdesign.com

How surefoot helped

Peak had conducted some preliminary analysis and laid out shipping costs by country and order size. They knew they were losing money, but weren't sure where to start to most quickly recoup it.

We reviewed Peak’s shipping data and conducted further analysis to determine where the most money was being lost. By joining their dataset with order data, we determined an optimal shipping threshold and fee for customers who didn't meet the threshold.

We designed and developed the shipping updates in Peak's A/B testing tool and coordinated the necessary updates on their Shopify backend. We then launched the experience to 100% of US-based traffic for 2 weeks when no promotions, ad buy anomalies or other events were occurring (a pre-post test).

Analysis revealed implementing a shipping threshold led to triple-digit revenue gains and triple-digit savings in annual shipping costs!

Our approach

We reviewed Peak's shipping and order data to determine where they were losing the most money and where to start.

Based on that data, we built models to identify the optimal free shipping threshold and fee structure for customers who didn't meet the threshold.

We designed, developed and coordinated the shipping threshold details in Peak's A/B testing tool and Shopify.

We conducted in-depth analysis and modeling on data from the pre-post time periods.

We recommended additional shipping threshold iterations to test to further optimize savings and maximize revenue.

+2%

Annual revenue gain

+17%

AOV increase

+16%

Transaction increase in orders above threshold

-21%

Reduction in shipping costs

Services surefoot provided

Pre-test Analysis

Design and Development

Results Analysis

In their words...

When we initially looked at our shipping data, it looked like the opportunity to save on shipping costs was with international markets. But surefoot dug in and determined it was actually the U.S. where we were losing the most revenue to free shipping.

With their help, we tested the shipping threshold confidently and thoughtfully. The results were awesome and our VP of Finance and I are happy boys - more money back in the ol' profit machine!

Adam Saraceno

In-house word wizard, STL-style pizza aficionado and CMO of Peak Design

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