So you have built the best eCommerce site experience you could think of. You may have captured a unique eCommerce niche, developed an attractive brand, fine-tuned your copy, and polished the site design. You’ve implemented some A/B testing and noticed an improvement in conversion. But why is cart abandonment rate so high and conversion so low? And more importantly, what you can do about it?
You are not alone. In fact, the following benchmarks show cart abandonment rates are high across sectors:
1. According to SmartInsights, average visitor-to-purchase eCommerce conversion rates sit between 1% and 6% depending on device, geography, and channel.
2. According to Bayard Institute, for those shoppers adding product to the cart and abandoning, the average shopping cart abandonment rates is 68% across industries. This number is the average calculated among a number of resources who have published their statistics on eCommerce cart abandonment. With such a high abandonment number, eCommerce sites have to take action to re-engage with hesitant shoppers.
3. According to Formisimo, the trend toward shopping cart abandonment seems to be increasing over the past decade. An average of 60% cart abandonment in 2006 has grown to 68% in 2014. However, since 2014, the cart abandonment average is decreasing once again. This is probably because of an increase in the number of conversion optimization techniques being used.
Next, let’s look at the reasons that shoppers abandon their carts. Let’s look at the graph below, then provide an explanation and examples for each reason.
1. Shoppers expect lower (or zero) shipping cost:
According to this BI Intelligence report, shipping costs are the #1 reason for cart abandonment. This Statista report cites that the number one reason for leaving a site without buying is ‘unexpected’ shipping costs showing up at the last minute of the checkout process before payment.
What can you do about it?
A. Provide free shipping up front.
Zappos is famous for providing free shipping to everyone, so they have eliminated this conversion killer upfront.
B. Provide free shipping above a certain expenditure or only for members.
Nike is transparent about their free shipping option on purchases of over $150 or to subscribed members.
If shipping is too costly for your business because gross margins are low, and providing free shipping to everyone will incur significant losses for the sale, you may want to look closely at your analytics and examine whether providing free shipping exclusively to new visitors may end up being profitable in the long run. For instance, if providing free shipping turns a visitor into a happy customer who ends up trusting your brand and purchasing a number of times from your site (while paying extra for the shipping on subsequent orders) then the actual cost of sponsoring free shipping for these new visitors, during the first purchase can be negated.
In other words, if free shipping is so important to first time visitors, and a significant segment of your first time shoppers end up buying more and becoming profitable customers in the long run, you’ve just found a profitable way of providing free shipping to these new visitors.
2. Shoppers were researching for total cost:
The second reason in the survey was that shoppers were not ready to buy yet. They were comparing total costs on various websites and wanted to know the final price including shipping, for comparison purposes.
What can you do about it?
A. If your store offers commodity products that can also be found on other stores, then make sure to use a price comparison service to adjust your prices according to changes in the market so that your pricing is always competitive.
B. Present total cost as early as possible. This creates a sense of trust and transparency. You don’t want the user to feel surprised. Here you can see how eBay is giving all the information about costs, delivery and payment up front.
C. Incentivize first-time visitors with an additional discount via a pop-up.
This fabric.com pop-up invites first time visitors to leave their email in exchange for receiving 10% discount.
More advanced pop-up functionality would use cookie-based data in order to only show up for first time users (meaning it would not show to users who had signed up before). In addition, an advanced pop-up functionality would use exit-intent technology. Meaning – it would not “disturb” the user until the point when the user’s mouse is ‘moving towards’ the closure icon.
3. Shoppers use the cart as a ‘save for later’ feature:
Sometimes, shoppers are not ready to purchase just yet and would like to keep their preferences for later.
Whether the reason is price comparison, or just saving the products for later consideration, shoppers use the cart as a ‘wish list’, and they expect it to be saved.
What can you do about it?
A. Some eCommerce sites keep the user’s unique cart, while some do not. If you don’t have such an option, you may want to consider implementing a cart ID, which shoppers can come back to easily. You may also want to use an expiration feature for carts to create a sense of urgency and drive shoppers to take action within a couple of days of abandonment.
B. Provide a ‘wish list’ feature that allows shoppers to save their preferred items for later. You can use this data in order to further personalize communication with shoppers in follow-up email. For instance, ModCloth uses a wish list functionality, and automatically send emails to shoppers when there is a price drop on products from their wish list.
Wish lists eliminate the trouble of searching products again, and therefore make it more likely that the shopper will complete the purchase.
Wish lists are also valuable due to the increasing habit of researching on mobile, and completing the purchase via desktop.
C. Ask for an email early.
When shoppers save their cart for later, it implies that they are interested in visiting those items again. In order to be able to send gentle email reminders, you want to collect shoppers’ emails as early in the process as possible.
For instance, Bonobos collects the shopper’s email address as the first step of their checkout process.
When trying to check out and buy an item, rather than asking for billing details, the first thing they ask for is an email address.
Theoretically, while this may lengthen the number of clicks until completion of the checkout, this allows for the start of a conversation, rather than optimizing the first purchase for a first-time visitor.
D. Send a series of cart abandonment emails to remind shoppers of their saved cart. In the email series you may choose to provide additional discount or free shipping, and add an element of scarcity (“only available in the next 24 hours”) to create a sense of urgency and drive action.
Here’s an example of a cart abandonment email:
E. Use Retargeting ad networks to approach shoppers with ads, reminding them of their abandoned cart. The cost of acquiring a new customer is 5 times higher than the cost for retaining an existing one. Retargeting ad networks such as AdRoll, allow you to place ads on sites that feature products the shopper has left in the cart.
4. Shipping date is too late:
Shoppers expect timely, and sometimes expedited delivery. A lengthy shipping time becomes an impediment for buying.
What you can do about it?
Come up with an attractive shipping offer, and be transparent about it.
You can also give the user different shipping options where the 2-day expedited shipping is ‘free’, subject to a commitment of an annual membership. Here is an example by Zazzle:
5. They couldn’t find a payment option convenient for them:
According to Internet Retailer, different payment options are preferred by shoppers in different countries.
So depending on your available geographies, you should include enough payment options for your targeted shoppers.
Here is the diverse set of payment options offered by BookDepository, an Amazon company, focused on international, free shipping of books. You may also want to add Amazon checkout to this list.
6. The design was not convenient enough:
In an era when competing alternative products are offered in many other venues, you don’t want bad design to drive potential customers to your competitor’s site.
Bad design can include: not providing enough information, hiding contact information for customer service, a confusing checkout process, an inadequate site search option, poor customer service or conflicting colors, and more.
7. Didn’t want (or wasn’t ready) to create an account:
Many shopping platforms and cart management systems are offering the option to pay without creating an account. For many users, this option is attractive. Klarna, with their ‘pay later’ feature, even allows for completing the whole purchase without triggering any payment options.
In summary, shoppers abandon their cart for various reasons and there’s a lot you can do to alleviate shoppers’ concerns or mitigate their reasons for abandonment.
Hopefully you’ve found this article helpful. Have you ever experienced any of the issues above? Have any of these pieces of advice been helpful to your eCommerce store? Please comment below.