Shoppers adding items to their online baskets then leaving the website without completing the checkout process has become a worldwide phenomenon. Fortunately for eCommerce website owners, virtually abandoned baskets don’t leave anywhere near the amount of clutter as physically abandoned baskets. However what they do leave is a sense of frustration amongst sellers. Why is it that more than 2/3rds of the people who visit an eCommerce website drop out at the last minute? In this blog posts we’ll be exploring the possible causes of shopping cart abandonment (SCA) and some simple practices that will minimise dropouts and maximise revenue.
What Is Shopping Cart Abandonment (SCA)?
According to Webopedia, abandonment is defined as an eCommerce term used to describe a visitor on a web page who leaves that page without completing the desired action. More often than not, it is the main obstacle faced by eCommerce retailers. In fact it’s estimated to cost vendors between 2 and 4 trillion pounds a year! Research by The Baymard Institute found that the average eCommerce cart abandonment rate is a whopping 69%. Cart abandonment is most prevalent in the travel industry, where 81% of baskets are abandoned. In comparison,the fashion industry holds a 73% dropout rate which is surprisingly low. What’s more, abandonment rates are even higher on mobile devices (85.6%) in comparison to tablets (80.7%) and desktops (73%).
To work out your abandonment rate simply divide the total number of website transactions by the number of transactions initiated. The latter number can be established by setting up Google Analytics to track when someone adds an item to their basket, or visits the checkout page, whichever is most relevant to your industry. It’s worth bearing in mind that nobody will have a shopping cart abandonment rate of 0%. Even international fashion retailer ASOS have been transparent about their struggle with the occurrence.
Why Do People Abandon Shopping Carts?
1) Unexpected Costs
Imagine finding a bargain £3 product, adding it to your basket and then being hit with a £9 delivery charge. In this scenario it’s no surprise that 63% of shoppers will abandon their carts. Transparency is a primary concern for most customers, especially when it comes to shipping. Research consistently shows that nowadays online shoppers expect free shipping. We can blame big name brands such as Amazon for this, since they have commodified free shipping it and enabled it to be seen as a norm. Therefore it’s easy to understand why more than 50% of online retailers offer some form of free shipping.
Solution #1: Offer Free Shipping
As well as being a strong incentive for most customers, implementing free shipping can also increase your average order value (AOV) by up to 30%, so it makes sense to consider it! At first free shipping may feel like a burden, since it usually amounts to around 5% of the total order cost, which ultimately means a 5% smaller profit margin. However, Multi Channel Merchant found that 46.5% of small to medium businesses say that offering free shipping increased their revenue, so think of it as a long term investment.
If you’re still having doubts about whether free shipping is viable, there are other alternatives available. Firstly you could increase the prices of your products by around 5% and then offer “free” shipping. This means there’s no chance of you losing out since the money you ‘lose’ by offering free shipping is gained by the higher product pricing. Another effective strategy is to offer free shipping on orders that meet a minimum threshold. Moreover, setting the threshold slightly higher than your AOV will encourage customers to purchase more products. This is the tactic that ASOS use. Thirdly, you could offer free shipping on certain days or at specific times. The benefit of this method is it’s exclusivity, customers are more likely to go through with purchases because they don’t want to miss out on the deal. UPS found that when merchants occasionally offer free shipping, their sales increase by 20%!
Solution #2: Be Transparent
From a young age we’re taught that honesty is the best policy, and this rings-true here. Customers don’t want to be burdened with shipping fees at the last hurdle, they want this to be clear from the outset. If you offer a flat shipping rate make that known to customers. Simply displaying it in your website header is enough to provide visitors with the awareness they need to complete their purchases. The same can be said for eCommerce businesses who offer free shipping, since it’s a driving factor behind a lot of purchases so it deserves to be shown off! Alternatively if you offer neither free or flat-rate shipping, swap this header for a link to a shipping rate calculator. This is enough to tell website visitors that shipping costs depend on what is being bought and where its being delivered too.
2) Visitors are Merely Browsing
The expansion of the internet and the growth of eCommerce has lengthened the researching stage of the buyer’s journey. This is reinforced by SeeWhy, who found that less than 1% of visitors will buy from a website on their first visit. Customers will take time to explore the price, quality and delivery time of a product before they commit to a purchase. We’re experiencing a clear shift towards the omnichannel shopper, and online reviews play a pivotal role in this process. In this sense many customers use their shopping baskets as “wish lists” for future reference. This is more convenient than individually bookmarking each product, or manually searching for each product every time you want to refer to it. Likewise, online shoppers are becoming lazier so instead of manually calculating how much their shopping cart is going to cost, if users add items to their basket the total price will be displayed automatically with no effort. Therefore it makes sense why 75% of customers come to a website with no intention to purchase.
Solution #1: Remarketing and Retargeting
Retargeting should be a crucial part of your conversion funnel. Without retargeting people who come close to completing an order you’re essentially relying on one-touch conversions, which for most people is unrealistic. Website cookies go hand-in-hand with retargeting. At the most simple level even displaying a generic brand image to all bounced visitors can sometimes be enough to encourage revisits and conversions. However the piece de resistance when it comes to remarketing is definitely dynamic retargeting. This clever technology tracks abandoned carts and allows ads on other websites to be personalised to include the items they’ve left behind. This type of remarketing is most commonly seen on Facebook, which is done by installing the Facebook pixel onto your website.
Alternatively, you could send follow up emails once a cart has been abandoned. To work out the best approach for your prospects it’s worth conducting A/B tests covering different times and frequencies. Some customers will be more receptive to emails sent within 2 hours of abandonment and others will prefer emails sent after a few days. In fact, Salesforce note that emails sent within 24 hours result in an average recovery rate of 60%. To see the best results these emails should contain pictures of the abandoned items, product reviews, refund information and a clear call-to-action such as a link to the product page. Most SaaS applications, such as WooCommerce and Shopify, can be set up to do this automatically.
Solution #2: Add a Wishlist to Your Website
If you’re trying to stop your visitors using your websites shopping basket as a wishlist, it makes sense to give them what they want and provide a designated wishlist. ASOS, for example, allows users to save items in the size they want for up to 60 days. As we’ve already established, most users who visit your website aren’t ready to purchase but equally don’t want to forget about items. Wishlists are the perfect solution as they act as a constant reference point. Wishlists are particularly effective on eCommerce websites that are constantly adding new products as users will get into the habit of constantly checking the website and adding things to their wishlist.
3) Visitors Are Discouraged by the Checkout Process
Having an uncommon or complicated checkout process is an instant turn off for most customers. Baymard found that 37% feel that having to create an account before they checkout is an issue. It may only take 2 minutes but as the old saying goes, time is precious. Likewise if your checkout process contains lots of stages customers will find themselves questioning whether it’s really worth it. According to ABTasty 21% of customers will abandon their checkout if the process is too long. The same is true of checkout security. With cyber crime and data fraud are at the front of everyone’s mind, feeling comfortable on your website is a primary concern for buyers.
Solution #1: Automate
According to Nadimo the most effective way of shortening your checkout process and reducing user fatigue is by removing redundancies and unnecessary field forms. How essential is it to find out your customers age and gender, for instance? These demographics may be helpful for marketing purposes but they add an extra layer to your checkout which requires more time, more effort and may be considered irrelevant by some customers. Streamline your checkout and strip it back to the basics – all that’s really needed to fulfil an order is a users name, address, delivery information and payment details. This can be simplified further by using address look up technology to populate delivery information based on the users postcode. Adding a ‘remember me’ checkbox will also streamline future purchases.
Solution #2: Create a Progress Indicator
When you’re stuck in a queue at a brick and mortar store you can physically see how close to the checkout you are. Customers want this experience to be repeated online. Without this customers are clueless as to whether they’re close to the end goal or whether there’s boxes left to fill. Amazon offer a good example of this – their progress indicator eliminates ambiguity and sets realistic expectations. Customers are therefore less likely to drop out because they avoid becoming frustrated.
Solution #3: Allow Guest Checkout
In order to avoid frustrate customers by requiring them to create an account in order to complete their order, it’s worth enabling guest checkout. Doing this sacrifices some of the valuable customer data you gain from account sign-ups, but ultimately it will generate more sales. Asking for customers data in exchange for a one-time purchase is a lot to ask. If your market is saturated, by not offering guest checkout you may be encouraging customers to shop with competitors. On WooCommerce and Shopify guest checkout is easily done by clicking a checkbox in your settings. Alternatively you could allow social signups to allow customers to checkout by signing in to their Facebook, Twitter and Google accounts.
Solution #4: Take Obvious Measures
As we’ve already established, security is a primary concern for customers. Including trust signals on your website is a good way to show buyers that your payment is legitimate and the chance of fraud is minimal. There are several ways to reduce anxiety. Firstly, displaying security badges on your checkout page from well-known companies such as Mastercard, Norton and McAffee will serve as a powerful form of social proof. Essentially this means you’ll benefit from their sense of trust and credibility. Secondly, purchasing a Secure Socket Layer (SSL) certificate will allow your website to be transferred from a HTTP to a HTTPS domain. This is beneficial because HTTPS domains are more secure and harder to hack. Finally, including an about us page on your website which includes photos and short bios from each member of your team will prevent you been seen as a faceless brand. Knowing that there are real humans behind the screen will help to put customers minds at ease.
Solution #5: Offer Multiple Payment Methods
It goes without saying that most people will have their preferred method of paying for purchases, whether that’s PayPal, Credit Card, Cryptocurrency or mobile payment. By limiting the available choices and only offering one or two payment methods you’re creating unnecessary obstacles for your customers. Mobile payments are particularly important as they are becoming ever more popular, especially now that a large percentage of shopping occurs on mobiles. In fact between 2015 and 2018 the use of mobile payments was predicted to reach 166 million users worldwide. Similarly, offering PayPal contributes to customers sense of security since it takes users offline to complete payments.