05 Feb Shopping Cart Abandonment is on the rise, so be prepared
No matter how good your shopping cart is at making the buying experience easy and fast for your customers, the reality of 2012 is that on average, shopping cart abandonment rates (the number of people who put things in the cart and don’t buy) are on the rise. One of the most basic reasons for this is that more customers are coming online armed with a “shop around” rather than “buy now” mindset. Customers spend more time window shopping and less time buying. What can you do about this?
The implications are that you still need the best shopping cart software for your business, but you must also work even harder at how you use your website to get customers to buy your products and services.
Shopping Cart Abandonment Rates – what the research is saying
That the shopping cart abandonment rate is rising across all industries is being supported by research evidence and is not just anecdotal. For example, a 2011 study by the E-tailing Group found that buyers are specifically seeking discounted products when shopping online with up to 47% of respondents in that survey saying they would only buy discounted products.
Research also shows that the rate of abandoment has been rising across all industries for the last few years, in spite of the efforts of marketers to increase conversion through specials and deals.
Why do people abandon carts?
Shipping costs are one of the major reasons worldwide that people abandon carts, and in competitive markets like the US, the research noted above found that up to 73% of survey respondents were seeking free shipping for their products. Research by Forrester Research from 2010 also found that shipping and handling costs to be the biggest reason why people don’t buy.
The main reasons for shopping cart abandonment are:
- Customers just shopping around for a better deal
- Objection to shipping price (comparing the end price of your product to the advertised price of the same or similar product at their local department store — no customers don’t take the cost of getting to the shop into account when comparing prices!)
- Objection to product price (can get the product somewhere else cheaper)
- Lack of product reviews, endorsement
- Fear of security issues when buying online (privacy, security)
- Delivery too slow
- Not ready to buy yet – want to buy later
What to do about Shopping Cart Abandonment
There two basic things that you can do about shopping cart abandonment:
- Deal with each abandoned cart on a case by case basis
- Deal with the general reasons that people abandon carts
We recommend you do both!
Here are some of the things that you can do:
- Use Discounts – fast moving consumer goods products like groceries and petrol use discounts every day, so take a leaf out of their book and develop a schedule of promotions on a daily, weekly or monthly basis. Rotating your specials will keep customers coming back to your site (if you have sufficient products to do so) and more traffic will keep your buyers fresh
- Use follow up emails or phone calls for abandoned carts – you could try offering deals for people to complete their purchase by throwing in something extra if they complete their order. Don’t be pushy or you’ll put off your buyer, however.
- Free Shipping Offers – as shipping is one of the main reasons that people abandon carts, free shipping can take one variable out of the equation, and reduce people’s buying objections. Studies have shown that for two sellers with the same products and same net price but one has a higher price and free shipping and the other a lower price with shipping, customers will tend to buy the one with the free shipping.
- Take advantage of the promotional features of your shopping cart: quantity discounts, multi-buy, free shipping over $x, cross sell, store wide sales, category sales, gift vouchers etc.
- Create a daily deal content page and optimise your page for your customers. At the end of each day, remove the deal and come up with a new one. Use a side banner to promote the daily deal.
- Offer Wishlists and use newsletters with the items in people’s wishlists, promoted. Wishlists get people who are just window shopping to indicate the products they are interested in, and capture those people as a future buyer. If a lot of people are wishlisting an item and not buying it, perhaps that’s a candidate for a special
- Use email marketing – newsletters, special offers, follow ups
- Encourage your customers to post reviews of your products on your site or on their Facebook page. Ozcart has a follow up email system to help you do this.
- Thoroughly review your product prices against what you consider to be your competition PLUS what shopping comparison websites consider to be your competition. That’s where your customers will be looking for your products and services after all!
Note that customers are savvy and know that increased competition puts them in a stronger position, so you need to be careful about how any blanket abandoned cart offers are provded – or else your customers will deliberably abandon carts in order to get the “deal”.
The good news for online shop owners is that there are more people shopping online, so regardless of the average abandonment rates, it means that if you can target your customers in the right way you have more chance of turning browsers into buyers.