What is Cart Abandonment?
Picture this, you like an item online. Then you hit "add to cart" on the it. But suddenly you change your mind and leave without purchasing the item. This is called cart abandonment.
Can you imagine that the cart abandonment rate is actually 70%? Well, according to research, 7 out of 10 people abandon their carts without buying anything. However, that depends on the industry. Either way, this is a major challenge in the world of e-commerce.
Because of this businesses lose their opportunity of making revenue. That's why, all the e-commerce brands monitor the statistics of cart abandonment to understand the issue, and resolve it.
Why Does Cart Abandonment Happen?
People abandon their online shopping carts for various reasons. Sometimes it could be due to a lengthy checkout process, or their own personal reasons. However, some of the common ones are as follows.:
- Unexpected Costs
Buyers only get to see their final amount at the time of checkout. Sometimes additional charges like taxes or delivery cost can make the total cost go above the budget. This can make them abandon the cart. - Complicated Checkout Process
If the checkout process is lengthy and complicated, then it may confuse the buyers. They may not have the time to go through all the forms and steps. This can lead them to simply abandon the cart. - Lack of Payment Options
Limited payment options can also discourage the buyers from completing their purchase. Not everyone can pay through the same method. They prefer to choose the mode of payment that is convenient to them. Lack of it may lead them to abandon their carts. - Security Concerns
If a website doesn't feel safe and secure to the shoppers, then they may decide not to buy from it. This can also result in leaving items in the cart without any purchase. - Browsing with No Intent to Buy
Some shoppers add items to their carts casually while browsing. They do not intend to actually buy them. They may do so to explore new stuff or to compare the prices. Such users also eventually abandon their carts. - Distractions or Interruptions
Sometimes, due to external distractions such as phone calls, or real-life interruptions, buyers' attention can be diverted. Due to this, they may forget to complete the checkout process. This also results in the abandonment of the carts. - No Guest Checkout Option
If a buyer has to make an account, or sign up on a website first, then they may choose to abandon their carts. Some buyers prefer the guest checkout option. - Mobile Experience Issues
If the page loading is slow, or the site's design is not optimised properly for the mobile users, then they may also abandon their carts.
Why is Cart Abandonment Important?
Because everytime a buyer abandons the cart, it's a lost opportunity for the online businesses to generate revenue. Therefore, it's important for them to focus on its metrics, and work on bringing down the abandonment rate. Following are the reasons as to why it's important:
- Lost Revenue
Because of cart abandonment issues, businesses lose their opportunity of making sales. In order to make profit, they have to focus on increasing their sales. That is only possible if they are able to find the reason behind why buyers are abandoning their carts. - Customer Behavior Insights
By studying the metrics of cart abandonment, businesses get an insight into why users leave their carts. Whether it's due to high cost or the complicated checkout process. Once they are aware of the issue, they can fix it. - Retention and Engagement Opportunities
Cart abandonment shows the businesses which customers took interest in their items. They can encourage these customers to come back and complete their purchase. It's easier and cost effective for the businesses rather than getting the attention of new customers. - Improved Customer Experience
By understanding the reason behind cart abandonment, businesses can fix the issues. Whether it's a slow website, high prices, or complicated checkout process. By fixing the problems, businesses can make shopping easier and convenient for the users.
How to Reduce Cart Abandonment?
It requires strategic actions to fix the problems as to why customers leave without buying. Following are some of the effective strategies that can help in reducing cart abandonment:
- Streamline the Checkout Process
- By making the checkout process simple and easy through reducing its steps.
- By avoiding asking for unnecessary information, and to speed up the checkout process, use of auto fill can be helpful.
- Offer Free or Transparent Shipping
- Offer free shipping or make the shipping cost clearly visible to the buyer at the time of checkout.
- Enable Guest Checkout
- Do not ask the user to sign in or make an account with the site to complete their checkout. Instead allow them to do so as a guest.
- Provide Multiple Payment Options
- Give users plenty of payment options to choose from. For example: allow them to pay through credit cards, PayPal, Apple Pay, PayPal, or Google Pay.
- Optimize for Mobile
- Make sure the website is designed for small mobile screens as well. The page loading speed should be faster, and navigation easier for a mobile device user.
- Add Trust Signals
- Show the users that the site is trustworthy and reliable. This can be done by Including SSL certificates, trust badges, secure payment icons, and visible customer reviews. It helps the new users in building their trust.
- Implement Cart Recovery Emails
- Reach out to the users who abandon their carts via email. Gently remind them of the items in their cart, or offer them free shipping and discount to encourage them to complete their purchase.
- Use Exit-Intent Popups
- If a user is about to leave a site without making any purchase, show popups offering them discounts. This can encourage them to buy before leaving.
- Display a Progress Indicator
- By showing the steps of the checkout procedure, users can feel how close they are to completing it. This gives them a sense of progress. It can make them feel their efforts are not a waste of time.
- Leverage Retargeting Ads
- By using retargeting campaigns on social media and Google Ads, users can be reminded of their abandoned cart. This can encourage them to return to the site to complete their purchase.
How to Spot and Measure Cart Abandonment?
To spot and measure cart abandonment, monitoring of the metrics through analytics tools provides helpful insights. Here’s how it can be measured and identified:
1. Cart Abandonment Rate Formula
Use the following formula to calculate the cart abandonment rate
2. Analytics Tools
The use of tracking tools like Google Analytics, or Shopify Analytics helps in monitoring the cart abandonment rate. With their help, businesses can identify and resolve the problems that lead to the abandonment of the carts.
3. Behavior Tracking
To understand the behaviour of customers, tools like Hotjar or Crazy Egg offer insights. It helps the businesses to track and pinpoint the reason where customers abandon their carts.
When to Focus on Cart Abandonment Recovery?
Cart abandonment recovery should become a priority when the following starts to happen:
- Your Abandonment Rate is Higher than Industry Standards
Always compare your cart abandonment rate to that of your contemporaries. If the typical benchmark of your industry is 60-80% , but yours exceeds that, then it's time for you to investigate the reason and fix it. - Seasonal Sales Campaigns
A lot of customers tend to abandon their carts during peak sales season, such as Blessed Friday, or holiday shopping season. In order to make profit and generate revenue during this time, focus on bringing back these customers by sending them reminders, or offering them discounts. - Frequent High-Ticket Abandonments
If most of the abandoned carts have expensive products from the website, then consider targeted recovery strategies. Send these customers personalized discounts or offer them to make payment on installments. - Behavioral Triggers
Gather insights from analytics to understand the behaviour of users. Find out why they left their cart, especially after spending a lot of time on the checkout page. Send reminders, or discount offers to encourage them to return and complete the purchase.
