Quick answer: A good free shipping threshold usually sits a little above your current average order value, and a common rule of thumb is 10 to 30 percent higher, so many shoppers need to add one more item to qualify. Start with your average order value, your typical shipping cost and your gross margin, check that the extra order value covers the shipping you give away, and make sure you have products at the right price to help shoppers reach the threshold. Then show it clearly on the site, add a progress message in the cart, and test it for long enough to see the real effect on orders and profit.
Why thresholds work
Shipping costs are one of the most common reasons shoppers abandon carts. Unexpected costs at checkout feel like a penalty. Free shipping removes that friction.
Offering free shipping on every order, though, can be expensive. A threshold is a compromise. It gives shoppers a reason to add more to the cart, which raises average order value and spreads the shipping cost over a larger sale.
Done well, a threshold can lift order value and conversion at the same time. Done badly, it gives away margin on orders that would have happened anyway, or sets a target so high that nobody bothers.
Step 1: Gather your numbers
Before picking a figure, pull these from your store data for the last few months:
- Average order value (AOV). Total revenue divided by number of orders.
- Order value distribution. How many orders fall into each price band. The average can hide a lot.
- Average shipping cost per order. What you actually pay carriers, including packaging.
- Gross margin. What you keep after the cost of goods, as a percentage.
- Current shipping revenue. What customers currently pay you for shipping.
Our guide to ecommerce KPIs explains how to calculate these reliably.
Step 2: Look at the order value distribution
Group orders into bands, such as 0 to 25, 25 to 50, 50 to 75 and so on. You are looking for where most orders cluster.
If many orders fall just below a certain value, a threshold just above that cluster gives a lot of shoppers a small, achievable reason to add more. If orders are spread out evenly, the choice matters less and you can focus on margin.
Step 3: Pick a starting threshold
A common starting point is your AOV plus 10 to 30 percent. For example, if your AOV is 60, a threshold between 66 and 78 might be a sensible first test. Round to a clean number such as 75, which is easier to remember.
Adjust based on the distribution:
- If most orders are well below your AOV because a few large orders pull it up, use the median instead.
- If your products are expensive and most orders are a single item, a threshold may not change behavior much. Free shipping on all orders, built into prices, might be simpler.
Step 4: Check the margin math
The threshold must pay for itself. Run a simple calculation for a typical order that moves up to the threshold.
Say your AOV is 60, shipping costs you 8 per order, and your gross margin is 40 percent.
- A shopper who would have spent 60 and paid for shipping now adds a 15 item to reach 75.
- The extra 15 in sales brings 6 in gross profit.
- You now pay the 8 shipping cost instead of charging the customer.
In this example, you lose 2 on that order compared with charging shipping. That might still be worth it if the threshold raises conversion rate, because extra orders bring more profit. But you should know the number before launching.
Also consider orders that were already above the threshold. Those customers now get free shipping without changing behavior. That is a direct cost.
These are illustrative numbers only. Plug in your own.
Step 5: Make it easy to reach
A threshold only works if shoppers have something sensible to add. Look at your catalogue:
- Do you have lower-priced items that complement your best sellers?
- Can you suggest add-ons in the cart, such as accessories or consumables?
- Would a small bundle help shoppers reach the target naturally?
Our guides to product bundles and WooCommerce upsells cover ways to suggest relevant extras.
If shoppers have to add something they do not want, they may abandon the cart or return the extra item later.
Step 6: Show it clearly
A threshold nobody knows about does nothing. Promote it:
- A slim announcement bar across the top of the site: “Free shipping on orders over 75.”
- A short line on product pages near the price or add-to-cart button.
- A progress message in the cart: “You are 12 away from free shipping.”
- A progress bar in a mini cart or cart drawer.
The progress message matters most. It tells shoppers exactly how close they are and makes the reward feel achievable.
Step 7: Configure it in your store
Most ecommerce platforms support thresholds natively.
WooCommerce. Add a “Free shipping” method to a shipping zone and set the requirement to “A minimum order amount.” Decide whether coupons count toward the minimum. Then hide paid methods when free shipping is available, which may need a snippet or plugin. Our WooCommerce shipping guide covers zones and methods.
Shopify. Create a free shipping rate in your shipping settings with a minimum order price condition.
Check details carefully:
- Is the threshold calculated before or after discounts?
- Does it include tax?
- Does it apply to all regions or only domestic orders?
- How does it handle heavy or oversized items?
Step 8: Test and measure
Run the threshold for long enough to cover normal weekly patterns, ideally several weeks. Compare with the period before, or run a split test if your platform supports it.
Track:
- Conversion rate
- Average order value
- Share of orders at or above the threshold
- Shipping cost as a percentage of revenue
- Gross profit per order and in total
- Return rate on items added to reach the threshold
- Cart abandonment at the shipping step
Our article on cart abandonment explains how to measure drop-off.
Judge success on total profit, not just AOV. A higher AOV with fewer orders may leave you worse off.
Variations to consider
- Tiered offers. Free standard shipping over one amount, free express over a higher one.
- Membership. Free shipping for paying members or loyalty customers.
- Free shipping on specific products. Use it to promote best sellers or slow-moving stock.
- Regional thresholds. Different amounts for regions with different shipping costs.
- Free returns. For clothing, free returns can matter as much as free delivery.
For a broader view of shipping options, our guide to ecommerce shipping strategy compares flat rates, real-time rates and free shipping.
Common mistakes
- Setting the threshold far above AOV so few shoppers can reach it
- Forgetting the cost of orders that already qualify
- Hiding the offer until checkout
- Excluding so many products that shoppers feel misled
- Changing the threshold often, which confuses repeat customers
Questions store owners ask
Should I offer free shipping on all orders instead?
If your margins allow and most orders are a single item, building shipping into prices can be simpler. Test both approaches if you can.
How often should I review the threshold?
Review it whenever carrier rates, prices or your product mix change, and at least a couple of times a year.
Should the threshold count discounted totals?
Most stores use the total after discounts, so a coupon does not push an order over the line at your expense. Be clear about this in the cart.
The bottom line
Set your free shipping threshold from your own data: start a little above your typical order value, check the margin math, make it easy to reach, promote it clearly and test it. The right number is the one that raises total profit, not just order size.
If you want help setting up offers and checkout flows that convert, see our Turn visitors into customers services.
