This Christmas Australia Post plans to waive online shipping costs from more than 40 of Australia’s leading stores including Myer and Target, but consumers have been warned to be wary of ongoing fees.

Australian online shoppers have been encouraged to pay a $9.95 sign-up fee to access Australia Post’s new membership program Shipster.

Members will receive free shipping for online orders at Athlete’s Foot, Booktopia, Clinique, Cotton On, Harvey Norman, Lorna Jane, MAC, Myer, Platypus, Review, Target, The Body Shop, Toys R Us, Typo and Vans, among other participating stores.

Each member will also receive a bonus free Deliveroo food order each month.

In the lead up to Christmas, between now and New Year’s Day, free shipping will apply to online shoppers who spend at least $25 and when shipping comes to less than $20.

However, from January 2 onwards, it will cost $6.95 each month for shoppers to avoid shipping fees.

These non-refundable fees will be charged directly to the nominated account on a rolling basis unless the subscription is cancelled, according to the Shipster terms and conditions.

Griffith Business School’s David Herold told The New Daily that customers “should be very careful to sign up as these limitations may make it very hard to benefit from the offer”.

How does it work?

When buying a product at one of the participating online outlets, the shopper will enter the email they used to create their Shipster account.

The shipping fee will automatically vanish on eligible purchases at the checkout.

The program is being trialled until January 1 across metropolitan Melbourne, Sydney and Brisbane.

After several quick searches in the postcode address tool, The New Daily found that suburbs such as Narre Warren, Berwick, Lara, Pakenham and Macedon were not considered within the “eligible” metropolitan Melbourne area – all within an hour’s drive of the CBD. Similarly, Ipswich near Brisbane, was outside the Shipster delivery zone.

Up to 60 transactions can be made in any three-month period, regardless of delivery location.

In recent years, Australia Post has revealed more than 70 per cent of its parcels are from online shopping purchases.

Australia Post acting managing director and group CEO Christine Corbett said the initiative would enable customers to buy more Christmas gifts online.

“With online shopping growing from 11.5 per cent to 15 per cent in the last 12 months, we’re predicting the busiest year for online shopping we’ve ever seen at Australia Post,” Ms Corbett said.

An Australia Post spokeswoman told The New Daily that the collective subscription costs would be shared with participating retailers during the trial period.

‘Be careful’ of return fees

Griffith University’s Mr Herold told The New Daily that the shift follows a trend in Europe where shipping costs are included in all prices of online goods.

“And even the return is for free [for example, in case you don’t like your new shoes],” he said.

“More generally, the Australian Post has a big advantage because it’s a huge organisation, so they can leverage their services. They already drive every day to almost every address in Australia, so some more packages do not have a big impact [on economies of scale].

“However, the transportation costs are still there and these costs won’t get away, so either the online shopper increases the prices or pure online shopping companies use the removal of shipping costs as part of their competitive advantage [and absorb the costs in their overall price structure].”

Monash University’s Sean Sands, managing director of Australian Consumer Retail, said the program would not only benefit consumers but also Australian retailers.

“In particular, with regard to competing against the likes of Amazon who already have similar subscription postage models,” he said.

“This is the big win here, but for consumers that do online shopping this is also a fantastic opportunity to save some money.”