No matter how hard online retailers are trying to generate brand awareness and guide customers through their sales funnel, on average, only three out of ten online shopping carts will generate a sale. It is very clear why customers decide to abandon their shopping carts, and the main reasons for that haven’t changed in the last few years.
Nevertheless, reducing cart abandonment can be quite a challenging task. In this article, we will look into the most common shopping cart abandonment reasons, why they emerge, and how your e-commerce business can address them in the best possible way.
Why do customers abandon their shopping carts?
Indeed, a large percentage of cart abandonment is merely the result of how customers are browsing e-commerce sites. Many people will visit your online store to do window-shopping, compare prices, save products in their cart until the next payday, etc. However, if we exclude this segment, we get the following reasons as to why people abandon their online shopping carts during checkout:
1. Shipping costs
Shipping costs are the most often cited reason for shopping cart abandonment. Skipping shipping costs until the checkout stage might seem a bit manipulative by many shoppers. Obviously, it is really hard to provide an accurate delivery cost until the customer has selected all the products they wish to purchase from your online shop and has provided a shipping address. You might decide to offer free shipping by rolling the shipping cost into the price of the product. Nevertheless, this tactic raises product prices that might make your brand less competitive.
An alternative to free delivery that might reduce cart abandonment is to provide an estimate or a minimum delivery cost. These prices might not be 100% accurate, but it will be a guide for the potential buyer.
Another popular tactic that gives shoppers a heads up about delivery costs before they reach the checkout stage is to include a delivery cost calculator on your product pages. Your customers can enter their postcode to get a more accurate quote.
Talk to our team today to explore your options for calculating shipping and delivery costs.
2. Being asked to create an account
Brands often ask their customers to create an account for marketing reasons that will make it easier to maintain a closer relationship with them in the future. They know that if a shopper creates an account with them, it is more likely to turn them into a repeat customer.
Make sure that when you ask your customers to create an account, you have made it as easy and transparent as possible for them. Since you have already collected their details during the checkout stage, creating an account should only require them to choose a password. Always ensure though, that your process is compliant with GDPR.
But in the end, you should always try to give your customers a really good reason to create an account with you. You should ask yourself the same question they will ask themselves at that point: ‘what value does creating an account offer me?’. A discount perhaps? Better tracking of your order? Maybe access to exclusive offers? Whatever the benefits are for your customers, make it apparent to them when you ask them to create an account.
3. Complicated checkout process and safety concerns
Collecting as much information about your customers is indeed extremely beneficial for future marketing activities. Nevertheless, providing a direct and seamless shopping experience is of paramount importance. The road to checkout should be as easy as possible for your customers. Therefore, ask yourself if these extra fields on your checkout form can provide you with valuable data that will justify the possibility of some customers abandoning their carts because of too many fields.
You should always consider the potential cost of adding ‘one more field’ on your checkout page. If you decide that this extra field is absolutely necessary, consider presenting it to your customers after they have completed their order. That way, you can get the data you want without risking cart abandonment.
Another reason why people abandon their shopping carts is that they may not feel confident providing their credit or debit card information, especially when it comes to small online retailers. It is true that the increasing shift to online shopping and the decrease of face-to-face transactions caused by the Covid-19 crisis resulted in the rise of fraudulent attacks across the e-commerce landscape, and your customers are very much aware of that.
Online fraud can hurt your company financially and also permanently damage your brand reputation. WebSell webstores follow PCI compliance guidelines that will help reassure your customers that their card data will remain secure while shopping on your online store.
You need to make sure your website is secure with an SSL cert and begins with https:// also to reassure customers about a secure shopping experience.
Shopping cart recovery strategies
Even after carefully optimizing the customer journey and making checkout as straightforward and as possible, cart abandonment will continue to be a harsh reality for many online retailers. Therefore, developing some shopping cart recovery strategies is essential.
Start by creating an abandoned cart drip email campaign to be sent to those customers that have created an account or have already provided their email address during the checkout process. The campaign will entail a series of personalized emails sent at specific time intervals, and their purpose is to remind the customers about their abandoned cart while providing them with reasons to return and complete their order. And email marketing is absolutely essential for e-commerce success.
Another useful cart recovery strategy is abandoned cart retargeting. Retargeting is a form of online advertising that is targeted to consumers based on their previous online activity; in our case, their abandoned shopping cart on your online store. Retargeting tags an online user by including a piece of code called a pixel within your checkout page that sets a cookie in the customer’s browser.
Later, when that customer is surfing online, you can remarket on their Facebook feed, Google searches, etc. A highly-personalized abandoned cart retargeting strategy can be a very effective technique, especially if it is combined with incentives, and its main advantage is that it doesn’t require that the customer has provided their email address. However, retargeting is more expensive than email marketing, which is a low cost, high yield activity.
Cart abandonment incentives
1. Monetary discounts
There are various types of incentives to use with your shopping cart recovery email campaigns and retargeting. Monetary discounts are the most common incentives offered, and they can be a percentage or a specific amount. A percentage discount can be applied to any order value. However, when it comes to specific amount discounts, it might be better if you limit them to carts that are above a particular order value threshold.
2. Loyalty or reward points
The next most popular incentive is loyalty or reward points. For a new customer, you can use a message along the lines of ‘Get 100 points by completing this order and get $20 off on your next order’. For returning customers, you can change the message to ‘Use your 500 points and get $40 off your order’, for example.
If you don’t implement a loyalty or reward points system, consider offering a gift to customers that come back to complete their orders. Be it a free sample or a complimentary accessory for the product they have put in their shopping cart, a freebie is always a great way to lure people back to complete an order.
3. Shipping incentives
Companies like Amazon are slowly turning free shipping and free returns into a norm nowadays, but that doesn’t mean that it is feasible for every brand. Businesses should make sure that they implement a shipping policy that works for their business model, size, customer expectations, and margins.
If you decide that offering free shipping every time as an incentive is out of the question because it is something your company cannot afford, consider only offer free shipping after a certain order value, discounted shipping, or free upgrade to pricier next-day shipping options.
4. Targeted incentives
Cart abandonment incentives are a great way of encouraging people to return to your online store and complete a purchase. But offering incentives every time a customer abandons their cart is not always the best solution. Besides the fact that incentives cost your company money, offering them for every single abandoned cart can devalue your brand in the long term. If you offer consumers an incentive every time they abandon their basket, they will most probably become used to waiting for offers and perceive your brand’s original product prices as bad value.
Sometimes, a single reminder email will do the job just fine. If not, you might need to use incentives, but always do that in a targeted fashion. And bear in mind that you can always create urgency and make your shopping cart recovery email campaigns and retargeting more effective by making your cart abandonment incentives time-limited.
Cart abandonment is a very complex issue and almost impossible to eliminate fully. It is therefore crucial for online retailers to fully understand the reasons why customers abandon their shopping carts and pinpoint the improvements they need to make on the consumer journey and checkout page design to overcome as many of these issues as possible.
Unfortunately, cart abandonment has no single solution. A highly-personalized, well-executed marketing strategy that combines email campaigns, retargeting, along with the use of the right incentives can help bring customers back to your site to complete their orders.
Stathis Kampylis is the marketing and communication coordinator at Shiptheory, a best-in-class shipping management platform that connects retailers with the world’s best carriers to automate shipping labels, manifests, and tracking. He is the main contributor to Shiptheory’s E-commerce and Shipping Blog. Find him on LinkedIn.