There is nothing more annoying to an online retailer than an abandoned shopping cart. You’ve invested time, money, and effort in building an attractive, easy-to-use website; you’ve followed a sound marketing and advertising strategy; you have the customer on your site, and they’ve chosen the item they want. However, they don’t complete the purchase.
Abandonment rates are on the increase in recent years. For example, a study by Baymard found that IBM reported an abandonment rate of 68.95% in 2015, as opposed to just 61.36% in 2007. That is an increase of almost 7% in eight years. eMarketer suggests that the trend has continued, with an average worldwide abandonment rate as high as 74.3% in 2016.
It is unsurprising, then, that Evan Bakker at Business Insider estimated:
[eCommerce merchants] will have lost $4.6 trillion worth of merchandise to abandoned carts in 2016, up from $4.2 trillion in 2013.
If you want to understand why cart abandonment rates have risen, you need to understand why people abandon their shopping carts in the first place. This information can help us to understand why they are doing so more now than in the past. More importantly, it can also help us figure out how to avoid shopping cart abandonment in the future.
The first thing we need to consider is if you are seeing high rates of shopping cart abandonment, then there is likely something on your checkout page that is driving your customers away. If they have made it that far, then we know they like your products and were able to find them in your store.
So, what could discourage them right at the final hurdle? Kissmetrics points to two particularly interesting factors that we need to pay attention to: shipping charges and account creation, both of which they say “kill conversions”.
According to Visual Website Optimizer’s eCommerce 2014 study, “28% of shoppers will abandon their shopping cart if presented with unexpected shipping costs”, while 23% will abandon their cart if they have to create a new user account.
Similarly, in Baymard’s study, we can see that extra costs account for 61% of abandonments. A further 24% was attributed to being unable to see or calculate the total cost upfront.
If you put yourself in your customer’s shoes for a moment, it is easy enough to understand why people might abandon their cart. Perhaps you have just spent a few hours reading reviews and comparing different products to decide which is right for you. Maybe you have been shopping around for awhile, trying to find the best possible deal. When you finally add the item to your cart and go to check out, something changes.
Unexpected charges can be especially annoying to the customer and therefore a problem for the retailer. Suppose your competitor is selling the same product at a higher price, and also offers free shipping? That might explain some of your abandoned carts.
Similarly, 35% of respondents to Baymard’s study suggested that they abandoned their cart because the site they were using required them to create an account, while 27% claimed it was because the checkout process was too long or complicated.
Taken together, these complaints suggest that a simple, easy-to-use checkout page would significantly lower abandonment rates.
From a user perspective, having an account in place typically makes the checkout process easier. Therefore, it could be argued that these responses are from two separate kinds of users: those who would rather sign up once and be able to buy with as few clicks as possible, and those who would prefer to fill out their information with each purchase rather than create an account.
According to Greg Sterling at Marketing Land, “roughly 56 percent of consumer traffic to the leading US websites is now from mobile devices”, as opposed to traditional desktop computers.
However, as Dave Chaffey at Smart Insights points out, most mobile users also have a desktop computer and are (as his data shows) more likely to use the latter for their retail needs, with between 63.3% and 80.6% of visits to retail sites in 2015 coming from desktop platforms.
Criteo supports Chaffey’s findings with more up-to-date information. According to their in-depth study, while 46% of all eCommerce traffic in the final quarter of 2016 was driven through mobile phones, the rate of purchases was radically lower, accounting for only 27% of all purchases.
This, together with the studies that Chaffey cites, suggest that people are more likely to browse retail sites on mobile, but not to add anything to their carts. When they do, they are more likely than desktop users to abandon their carts.
Business Insider offers a succinct and accurate explanation: “It's easy to search for items on mobile, but entering all of the form fields at the checkout stage is still difficult”.
If users are going to browse your site on their mobile device, but only make purchases on their desktop computer, this changes the way they will interact with your store and products.
Factors such as surprise costs and mobile difficulties are factors that affect shopping cart abandonment rates, but they are ultimately not the underlying cause of most abandonments.
Zack Rutherford, writing at SaleHoo, provides a list of possible explanations for abandonment, including:
Provide an easy – and transparent – checkout experience
It’s always a good idea to be open and honest with your customers right from the start. With regards to shipping fees and any other extra charges, although you might include these on your checkout page, it’s advisable to give them a warning right from the start. Even if they have to be estimates on product pages and throughout the checkout process, this should help to provide transparency and reduce abandonment.
TradeGecko points out that offering free shipping, even if it’s not all the time, is a great way to drive sales:
It may be not feasible to fully eliminate shipping costs on your site all the time, but don’t underestimate the power of organising a couple or more free shipping promotions throughout the year.
Displaying your fees upfront might put off some people at an earlier stage. However, these people are generally the same ones who will abandon their carts if they see fees on the checkout page. Therefore, losing them earlier is no loss at all. What’s more, they will probably leave feeling better about your company if you are honest and upfront with them.
To avoid losing people who don’t want to create user accounts, you should also offer a guest checkout option. This makes it easy for people without accounts to shop with you, and will therefore increase your overall sales. If you really want people to sign up, you can always give them incentives to do so without locking unregistered users out completely.
There is another effective solution: “ask your users to register for an account after the sale, not before.” This has the advantage of allowing guests to buy from you, with the added bonus that some of them will sign up afterwards.
You need to keep your checkout process as simple and as easy-to-understand as possible, even for guests. There is a minimum level of information you can ask for – name, contact information, payment details, and billing / shipping address. However, any other fields should be optional, if present at all.
Including a progress bar on the checkout page also makes a big difference to your user experience. This makes it clear to your users how much of the process is left, and will help to avoid making them give up because it seems that they’re just filling out one long, endless form.
One way to capture more sales is to make your site more shoppable for mobile users. This goes beyond simply having a responsive site. If you want to counteract the negative effect that mobile and multichannel browsing has on your shopping cart abandonment rates, you need to give your users a good, cross-channel experience.
Perhaps paradoxically, both guest accounts and strong user accounts can help with this. As we discussed above, allowing guest purchases can save your users from having to fill out lengthy forms when they check out on your eCommerce site. This can be particularly advantageous to mobile users, who would otherwise have to type out lots of information using a touchscreen, which is a difficult task for many of them.
Conversely, a strong user account system makes it easy for multi-channel users to add a product to their shopping cart on their phone and they buy it on their desktop device. This sort of system also allows consumers to enter their payment information once on their PC, and then buy with a single click on their phone, once they are signed into their existing account.
As previously mentioned, a simple and streamlined checkout page – one that works as well on mobile as it does on desktop – is a must for the modern eCommerce platform.
A responsive checkout will make it easier for mobile users to make purchases without becoming frustrated, and provide a consistent, user-friendly experience for multi-platform users.
According to Kissmetrics, 13% of shoppers report abandoning a cart because of “payment security concerns”; SaleHoo reports a higher rate of 17%. Similarly, Baymard reports that 18% of shoppers “didn’t trust the site with my credit card information” and 8% felt that “there weren’t enough payment methods.”
All of these complaints add up, but can be resolved by providing a secure, trustworthy checkout experience.
Unfortunately, that can also mean providing shoppers with as many payment options as you possibly can. Each individual user has their own preferences and prejudices, so if you can provide their favorite payment option (or several alternatives to their least favorite) you’re more likely to secure their business.
Walmart is a great example of this. The American retail giant offers an “extensive list of payment options for their eCommerce site”, including “a variety of credit cards, third-party online payment services such as PayPal, and even Walmart rewards cards.”
It might be worth clarifying which payment types are available before your users see the checkout page. For example, many websites incorporate the logos of the payment systems they use into their global site footers.
As Dan Shewan at WordStream points out:
“if you’re not remarketing to people who came close to crossing the line, you’re effectively restricting yourself to just one shot at getting visitors to convert in a single session”.
More and more businesses are sending out retargeting emails, reminding customers of the items in their shopping carts, or making use of the remarketing options offered by platforms such as Facebook, AdRoll and Google AdWords.
As Helen Jones, co-founder and CMO of Beeketing, points out: Amazon is an especially great example of the value of follow-up emails. Their particular brand of retargeting allows them to reach out to customers who have abandoned their carts and to reduce their abandonment rates.
Retargeting emails are fairly simple, and most companies can do them in-house, which also makes them cheap to produce. You simply send out ‘reminder’ emails, to your registered customers, about the product they have added to their carts. If you’re clever, you can also use this opportunity to recommend similar items to purchase.
The potential downside to these approaches are that it only works if you have the customer’s email address, which you might not have if you allow guest purchases. You also run the risk of simply annoying them, and alienating them for good.
Remarketing via Facebook, AdRoll or Google AdWords is a subtler approach. However, it will require you to invest money before you see a return on your investment. The specifics vary depending on which platform you use.
The idea is simple: customers who have added an item to their shopping cart on your site will see ads all over the net for that specific item. Since they obviously like the item enough to click “add to cart”, they are more likely than the average web user to click on a link with a picture of that product. This, essentially, gives you a second chance to close the sale.
Retargeting and remarketing can even help you salvage some sales from the high percentage of customers who are “just browsing”. It is probably the only chance you’ll ever have to recapture those customers who change their minds for reasons beyond your control.
There are many factors that lead to high shopping cart abandonment rates. As we have seen, these include but are not limited to:
Each of these issues presents a challenge to be overcome. Retailers can address them by providing a transparent shopping experience from start to finish. It is necessary to eliminate hidden costs, to allow guest purchases, and to offer as many secure payment options as you possibly can.
Retargeting and remarketing are also a solid strategy, as they allow you to recoup some of your losses after your potential customers have left your site.
Ultimately, the best way to decrease your shopping cart abandonment rate is to provide the best possible user experience. If your customers can easily find the items they’re looking for on a well-designed, easy-to-navigate site, they’re more likely to buy from you.
TradeGecko’s innovative inventory and order management software can make your job easier. We offer a solution for eCommerce inventory management that easily syncs all of your shopping and shipping data, as well as integrating with leading shopping cart solutions such as Shopify and WooCommerce.
Check out TradeGecko with a free trial and see how we be a part of your solution for your business.