Photo by Andrea Piacquadio
Over the past few years, online shopping has exploded in popularity, and for good reason. The convenience that online shopping offers simply cannot be met by physical stores. Online shopping enables people to order any product from any location and have it delivered directly to their homes. But this level of convenience can also come with some unexpected consequences.
In some cases, a product can be more expensive from an online retailer than if you were to simply go to your local store. This isn’t usually because the products actually cost more from online retailers, but rather because there are generally some hidden fees with online shopping. Today, we’ll be discussing some of the most common causes of hidden costs for online shopping as well as how to avoid them.
Some of the Most Common Hidden Costs
Markups And Additional Charges
In many situations, online stores will mark up the prices of their products to cover some or all of the fulfillment cost. The reason businesses do this is because recent data has shown that online shoppers hate paying for shipping. For instance, many online buyers are more likely to purchase a product that costs $30 but comes with free shipping than they are to purchase a $25 product that also charges $5 in shipping. It is fairly common these days for digital storefronts to add the cost of shipping to the price of a product and then offer customers “free shipping.”
But markups that include shipping aren’t the only additional charge that consumers may face when buying products online. In physical stores, the price they display on the product is typically the price you pay, but digital stores will oftentimes add extra fees to the end of your purchase. Some of the most common hidden fees are service charges and membership fees. These costs generally aren’t displayed until the final step of the checkout process, making them difficult to account for before finishing the purchase.
Expedited Shipping Options
There is no denying that overnight shipping is incredibly convenient for purchases that need to arrive quickly, but it can also be outrageously expensive. In some situations, same-day or overnight delivery can cost more than the actual product you’re having shipped. Remember to search for the product you need at local stores before jumping for expedited shipping options. This will not only help you save money, but it is much kinder to the environment as well.
Impulse Purchases
Many online retailers rely on impulsive spending habits to make a quick sale. Online stores typically receive fewer return requests because of the additional hassle consumers face. At physical storefronts, it is fairly simple to walk in and ask for a refund. But with online stores, the return process and policies related to it can be vague or difficult to find. Some eCommerce businesses will prey on impulse buyers and hope that they find the return process too inconvenient to deal with.
International Transaction Fees
One of the advantages of online shopping is that you can purchase products from anywhere on the globe. However, there are additional fees related to buying products internationally. Firstly, you need to consider the conversion rate between your native currency and the currency of the country you're buying a product from. On top of this currency conversion rate, there are also international transaction fees. International transaction fees are costs that you must pay for your card issuer to convert the transaction across different currencies. This could cost you an additional 3% of the entire price of your purchase.
Photo by Andrea Piacquadio
How to Avoid These Hidden Costs
Compare Prices
You should always compare prices before finalizing a purchase when shopping online. There is a great deal of competition in the eCommerce industry, so use this to your advantage. There is a good chance that you’ll be able to find a similar product, or even the exact same product, for a cheaper price somewhere else. It is much easier to compare prices online than it is at physical stores. Before you make a purchase online, take a moment to visit a few other websites and see what they have to offer.
Keep an Eye On Shipping Fees
Shipping fees are unavoidable in online shopping, but that doesn’t mean you can’t find a better deal. Different delivery carriers will often charge different shipping rates depending on your location and the starting location of your purchase. It is pretty common for stores to offer different shipping methods, so be sure to select whichever method gives you the best deal. You can even use a USPS shipping calculator to find the best deal for shipping your products. Remember, expedited shipping may be convenient, but it is also incredibly costly. Ask yourself if you really need the product immediately before you choose overnight or same-day delivery.
Be Wary of Related Products
One of the most common ways that digital retailers capitalize on impulsive spending habits is by recommending products that are related. You may have seen this in practice whenever you scroll to the bottom of a product page and see a few other products labeled, “frequently bought together,” or something to that effect. Purchasing these products isn’t a bad idea if you genuinely need them, but that isn’t always the case. Ask yourself if you seriously need one of the recommended products before you commit to buying them.
Buy Locally Whenever Possible
The most effective way to avoid high shipping fees and international transaction fees is to buy local products whenever possible. Not only will this guarantee that you don’t need to convert your home currency to a foreign currency, but it will also ensure that your products will be delivered quickly and cheaply. In general, the less traveling your purchases have to do to arrive at your home, the cheaper they will be. This also means that less fuel is used to transport your purchase which means you’ll be contributing less to pollution.
