BI Intelligence estimates that over $4.5 trillion of merchandise will be left in online shopping carts this year. Many marketers create an email to target people who abandon their cart and then they essentially wash their hands of the problem. But this is short-sighted, as even small changes in the recapture rate can generate large impacts in revenue. A merchant with $15m in online sales who can convert 25% of their abandoned orders would generate an extra $169M a year. As a marketer, this is somewhat low-hanging fruit we should be paying more attention to.
If you look at the primary causes of cart abandonment globally, you will notice that a lot of the reasons boil down to cost or website functionality.
That means that we can’t actually resolve cart abandonment without a holistic look at the customer experience. Here are 10 key approaches to reduce your shopping cart abandonment rate (though they are by no means the only tactics):
- Address the functionality gaps that are causing people to drop off during the checkout process. Conduct customer surveys, focus groups, and internal testing to identify and resolve pain points. For example, enabling guest checkout can help recoup the 10% of cart abandoners who leave because they don’t want to register.
- Review your product pricing and shipping costs. The majority of online buyers find shipping costs of more than 10% of the transaction value to be unreasonable and abandonment rates go up dramatically once they surpass 20%. Though it isn’t always possible to offer free shipping to everyone, consider offering it based on order minimums; this can have a side benefit of driving average order value up by as much as 30%. And look at the overall price points - key thresholds like $100 and $250 are very prone to drop-offs in purchasing rates.
- Offer alternate payment methods. The majority of online purchasers use alternate payment methods like Alipay and PayPal and many find them easier to use than credit cards, since they remove the barriers of entering financial and shipping information on every transaction. Plus, having more payment methods available actually makes online shoppers find your website more trustworthy, even if they do not use them.
- Up to 40% of abandonment is due to consumers using shopping carts for early stage buying behavior, treating it as a wish list for future purchases, storing items to access on another device, or summarizing their purchases to make final decisions. By providing additional website functionality to support this behavior, you can divert it away from the shopping cart.
- Although email capture rates on e-commerce websites can be as low as 2%, almost half of repeat cart abandoners will buy when they are remarketed to. With conversion rates for up to 6% of those targeted and about half of shoppers expecting an email, this can be a cost-effective way to automate engagement with shopping cart abandoners without seeming intrusive.
- Repeat customers and serial cart abandoners are more likely to repurchase than new visitors, so it’s very important that you actually start earlier in the process, with a welcome program to convert first-time purchasers into repeat visitors.
- Conversion rates on retail apps are 3x higher than on mobile browsers and account for 54% of all retail mobile transactions. A program of push notifications and in-app messaging can help recapture shopping carts from these frequent shoppers.
- Since you likely won’t have email addresses for the majority of cart abandoners, pixel-based ad retargeting is an important remarketing strategy. On average, 30% of non-converting shoppers will return to the website after being retargeted.
- Real-time abandonment offers that pop up on your website as the person leaves their cart can help recapture over 25% of abandoners. Some companies have also seen revenue per visit rise by up to 10% as a result of these targeted incentives.
- Not everyone who adds an item to their cart will buy online. Some may want to view it in person or are hesitant to buy online because of privacy or security concerns. Offer ways for people to continue their purchase offline, such as by requesting a product demo session or offering a store locator.
As marketers start to take more ownership of the entire customer experience, the shopping cart is a perfect place to start, since it offers huge potential revenue impacts.
*Statistics cited sourced from BI Intelligence, IBM, Forrester, IDC, LYONSCG, WorldPay, SeeWhy (SAP), Experian, Kuno Creative, Conversions on Demand, and Deloitte.