The typical eCommerce owner faces a myriad of challenges with their online business, from marketing to their ideal customers, to ensuring product delivery and building a seamless online experience. Perhaps the one issue that plagues the industry the most is shopping cart abandonment.
What is cart abandonment?
Cart abandonment is when someone adds items to their cart but leaves the eCommerce site without ever making a purchase. They may never return or they may have signed in with the intent to return later, but often forget to. Whether they got distracted, decided against the original purchase, or were simply making a wish list of items (a sort of online “window shopping”), cart abandonment is extremely common. According to Statista, 88% of shopping carts were abandoned in 2020.
Cart abandonment vs. checkout abandonment
Cart abandonment can happen at any time throughout the purchasing journey. Checkout abandonment, on the other hand, happens once a person proceeds with the checkout process. At what point a user chooses to abandon the checkout process can shed a ton of light on what part of the process might not be working for users.
For instance, if a payment information page doesn’t show security logos, a user might get apprehensive and leave. Or if the checkout process is unnecessarily long, a person might lose patience and abandon it altogether.
This is important because users who actually make it to the checkout phase are motivated buyers. In most cases, at least part of them intended on making a purchase. That’s why targeting and optimizing the checkout process can lead to higher customer conversion rates. (more on that later).
Why cart abandonment is dangerous for retailers
Cart abandonment is one of the biggest concerns for online retailers because the scope of the problem is so vast and represents trillions of dollars of lost revenue. Retailers can simply calculate their shopping cart abandonment rate by dividing the number of purchases made online by the number of shopping carts created. Subtract this number from 1, then multiply by 100.
For instance, if you had 250 online purchases but 500 carts were created, you’d have a cart abandonment rate of 50%. In reality, average shopping cart abandonment rates are much higher.
Effects of shopping cart abandonment
In 2020, the industries hit the hardest by cart abandonment were automotive (96.88%), baby and child (94.36%), luxury (92.61%), car rental (92.04%) and airlines (90.91%). While some cart abandonment is to be expected, these staggering numbers represent major lost opportunities for online sales. Where these numbers really start to hit home is at scale. In some cases, just decreasing your cart abandonment rate by 10% could mean thousands, if not millions, of dollars in monthly sales. In fact, according to Baymard Institute, $260 billion worth of lost orders can be recovered through optimizations to the checkout process.
Why customers abandon their carts
The internet is a noisy space with no shortage of distractions. From suddenly remembering to check email or Google a random question to being distracted by ads or listicles at the bottom of a screen, users can easily navigate between tasks online. And that’s when they’re just using a computer or smartphone. What happens when multiple devices such as TV, phone and computer come into play at the same time? Needless to say, it’s easy to get distracted.
Some level of distraction is expected. The same is true for browsing. Some users like to put together online carts with no intention of buying. Still, there are a handful of other reasons users abandon their carts. The most common mistake that eCommerce companies make is that they failed in one of the following areas: they didn’t build trust, they didn’t eliminate fear, or they didn’t reinforce the benefits of making the purchase.
- Fears over safety and security: Security and data safety are major reasons why people abandon their shopping carts. Divulging protected information online (think one’s credit card details), is a scary thing for many shoppers, so they need to trust that when they enter their payment information, it will be secure. The same applies to personal information like their cell phone or email. Many users bounce because they are forced to create an account and they don’t know how their data will be used.
- Extra steps: Consumers are kind of lazy, in all honesty (we’re consumers, too, so we can say this), so asking them to fill out personal information every single time they check out becomes tedious, daunting and frankly exhausting. eCommerce is all about tapping into user needs for instant gratification, so truly optimizing your consumer check-out process means providing streamlined options — a la Shop App — and making ordering your products or services as quick and painless as possible.
- No clear benefits: Online shopping may be more convenient than in-person shopping, but it can also be more complex. That’s why many online users compare prices, read reviews and research products in much more depth than they would if they were making in-store purchases. To that end, users need affirmation that they are making smart purchasing decisions. That’s where reinforcing the benefits of actually making the purchase come into play. Whether offering additional discounts or incentives like free shipping so that a user feels like they are getting a good deal or touting the quality of the product at hand, eCommerce sites can do a lot to move the customer along with confidence and eliminate buyer’s remorse or second thoughts about hitting the final button to place the order.
- Lack of trust: A final factor that leads to shopping cart abandonment is time and user experience. If the process is lengthy, or web pages load slowly, users are likely to bounce off a page. Or if the design of a site isn’t professional, a user might not think it is a reputable company. Design goes a long way in building trust with a user.
10 tips for reducing cart abandonment
- Build trust with security logos and reviews. According to a study by Baymard Institute,17% of users abandon their cart because they are afraid of giving their credit card information. Trust badges such as McAfee Secure, BBB Accredited Business, Verisign, Paypal Verified, to name a few, go a long way in helping users feel more confident about their purchase. Want to take trust a step further? Utilize social proof by displaying positive company reviews.
- Enhance user experience. A lengthy checkout process is almost guaranteed to make some users abandon their shopping cart. One way to mitigate this is to shorten the process. Make it simple and work with your developers to optimize page load times. Another simple solution is to visibly track a user’s progress through the checkout process. Consider a simple 3-step process that is visible to users, such as payment information, review order, and confirmation.
- Offer multiple payment options. While credit cards are a no-brainer for online shopping, many successful eCommerce companies offer additional options like Paypal, Apple Pay and Google Wallet. As mentioned above, do everything you can to build confidence that the customer’s payment information is secure.
- Save shopping carts. Some users put together carts for fun with no intent to buy right now. Others are eager buyers who got called into doing something else. Offer users the opportunity to save their cart by logging in or tracking cookies. That way, they can pick up where they left off, and in the event they do log in, you just scored their email address to contact them later.
- Offer guest checkout. While we just mentioned those email addresses are nice to have, a staggering 24% of users abandon shopping carts because they don’t want to login or sign-up. Consider the lost revenue of this group of people and whether their email address is worth all those lost sales. Guest checkout is an excellent way to recover some of them.
- Offer free shipping. The single biggest reason people abandon their cart is because of unexpected shipping costs. While it’s always good practice to make all costs known upfront (add shipping times too while you’re at it), many successful eCommerce companies target this customer pain point by eliminating it altogether. Free shipping is a very enticing offer for online buyers. You can also make free shipping a limited-time offer or make it contingent on total spend (for instance, free shipping on orders over $50) to further encourage online customers to buy now.
- Use an exit intent popup with a discount offer. When a user attempts to leave their cart, install a popup that clarifies their intent. Did they mean to leave? Would an additional one-time discount code incentivize them to make the purchase now? Consider installing this as a last-ditch effort to keep the customer engaged.
- Send a reminder email. Some best practices apply here. According to Barrilance, you can increase your conversion rate by between 8-10% by simply sending the email at an optimal time. They recommend sending a total of three follow-up emails at these intervals: 1 hour after abandonment, 24-36 hours after abandonment, and 72 hours after abandonment. Additionally, subject line matters here. Strive for personalization—both of the person’s name and details from their cart.
- Create a sense of urgency. Time-bound offers are an excellent way of encouraging your customers to take action. Whether making certain deals available for a short window of time or having an actual clock ticking down on your site, this helps users prioritize finalizing their cart checkout.
- Retarget customers who left. This strategy is employed by the most savvy eCommerce companies. It builds on the idea that once a brand is out of site it is out of mind, and leverages ads to quickly remind customers what they were looking at. Facebook retargeting is a great way to reach people because so many people use the platform multiple times throughout the day. Google Adwords and Bing Ads is also highly effective. By showing thumbnails of specific products that a customer was interested in, or simply showing your logo or other recognizable brand identity, you help users remember what they were looking for.
Start Reducing Your Cart Abandonment Today
A strategic eCommerce partner will work with you to reduce cart and checkout abandonment, optimizing your eCommerce experience. Contact us to schedule a discovery call and learn more about optimizing your eCommerce site for better cart conversion.