A busy e-commerce store is great—if shoppers are buying. But a lot of online traffic doesn’t necessarily equate to a lot of conversions. If you experience a high cart abandonment rate, you're not alone. Cart abandonment is a common and often difficult hurdle many online retailers face that can result in missed revenue and conversion opportunities.
To put this problem into perspective, e-commerce stores lose around $18 billion in sales every year because of cart abandonment alone. If that number isn’t alarming enough, next year, predictions for merchandise left behind in virtual carts is a colossal $4 trillion!
Thankfully, there are ways to change course and minimize cart abandonment. All it takes is the right resources and approaches. In this comprehensive guide, we’ll dive into what cart abandonment is, the reasons behind it, and different strategies to combat it. We'll also reveal the critical role that AI and machine learning play in helping e-commerce businesses conquer this challenge.
What is cart abandonment?
Cart abandonment happens when a potential customer adds products to their online shopping cart but leaves the website before completing the purchase. How often does this occur? According to Baymard Institute, way more than you think—70% of shoppers ditch their carts without buying anything. This means only three out of every 10 online consumers that add something to their basket actually complete their purchase.
Knowing your cart abandonment rate is essential to understanding your digital store’s performance. To determine your cart abandonment rate, divide the total number of completed transactions by the total number of add-to baskets that didn’t result in a sale. Then, subtract the result from one and multiply it by 100. The result is your total cart abandonment rate.
Cart Abandonment Rate = [1 - (Number of Completed Transactions /
Number of Shopping Carts Created)] * 100%
For example, let’s say your e-commerce store had 25,000 sales this month. However, the number of sales initiated was 90,000. By subtracting the result from 1, you can see that your cart abandonment rate is 72%.
Because this metric directly impacts your bottom line, knowing what it is can help you determine where to make improvements.
What are the main reasons for cart abandonment?
There are numerous reasons why shoppers leave items in their carts without buying. Understanding them is crucial to handling them effectively.
- Unexpected costs, such as taxes and high shipping fees, are some of the biggest turn-offs for customers, and why nearly half of all online consumers desert their carts.
- A long or complicated checkout process with too many steps can be annoying, and is why 26% of shoppers give up completing their purchases.
- Website performance issues, like technical glitches, slow loading times, and a lack of mobile optimization, can send potential customers running to your competitors' sites.
- Limited payment options can be a major hindrance for shoppers who expect to be able to pay with their preferred method (FYI: 9% of customers ditch their cart because of this reason).
- Mandatory account creation deters 24% of consumers from buying because of the hassle it creates during the checkout process.
- A lack of trust in website privacy and security are common triggers for buyers, and contributes to 45% of shoppers walking away from their carts empty-handed. (Source: RetailWire)
- Limited shipping and return options can cause customers to abandon their carts, especially if delivery times are longer than expected.
- Comparison shopping is a common practice that happens when shoppers use the cart to compare prices or products, and then leave to continue their research on other websites.
- Distractions from external factors, like a phone call or notification, can cause customers to leave an e-commerce site before completing their purchase.
How can e-commerce brands reduce cart abandonment?
Several strategies can be implemented to combat cart abandonment. Here are our top nine recommendations:
1. Send out abandoned cart emails.
Abandoned cart emails are friendly reminders sent to known visitors who left their carts without checking out, to encourage them to reconsider the products they left behind. They're also a way to connect shoppers to your brand and help you recover lost sales.
A study from Moosend found that 50% of cart abandonment emails are clicked on and even more, half of the recipients who engaged with the content of the email, ended up completing their purchase. To get the most out of your recovery emails, follow these key steps:
- List the items that are in the shopper’s cart.
- Highlight an incentive or social proof point, like free shipping or limited inventory, to create urgency and motivate them to finalize their purchase.
- Include customer reviews or positive social feedback for added credibility.
- Use a compelling, personalized subject line to improve your chances of the email getting opened.
- Don’t forget about strong visuals and a clear call to action (CTA) button.
- Set up an automated email sequence that is sent out over time to gently nudge users to return and complete their transactions.
2. Simplify the checkout process.
Shoppers expect a quick and straightforward checkout. Give them the opposite, and you’re likely to lose these visitors for good. A streamlined checkout process is essential to leaving a positive impression and securing repeat purchases. More so, it can give your conversions a 35.62% boost.
To optimize your checkout:
- Remove unnecessary steps by creating a one-page checkout that only asks for essential information.
- Offer a guest checkout option for those who don’t want to create an account.
- Save customers time by enabling autofill for addresses, credit card details, and other essential information.
3. Provide a variety of payment methods.
E-commerce retailers should do everything they can to make payment options flexible and convenient for their customers. The more payment options you offer, the more likely they’ll follow through with their purchase.
Here are a few ways to optimize the payment process:
- Expand your payment options to include everything from debit and credit cards to digital wallets like PayPal and Apple Pay.
- If your e-store sells to international markets, make sure to offer multiple currencies.
- Allow customers to pay in installments, through Buy Now, Pay Later (BNPL) services.
- Offer subscription services for relevant items that customers will want to order on a recurring basis, which can avoid checkout altogether (after the first purchase).
4. Display trust signals.
Building trust can go a long way in improving conversion rates. If shoppers feel their information is secure, they’ll be more likely to complete a purchase. And while there’s no guaranteed way of eliminating the worries of anxious shoppers, there are ways to provide some needed reassurance.
To boost your trust factors:
- Show trust badges, like security seals and payment icons.
- Highlight data protection measures, such as password encryption and SSL certificates (which is also a factor in Google search rankings).
- Offer a thorough return policy or money-back guarantee.
5. Utilize retargeting campaigns.
Retargeting ads strategically showcase abandoned products across different platforms, reminding visitors about their pending purchases and (hopefully) bringing them back to your website. Question is, do they actually work? Studies say they do, bringing 26% of shoppers back to your site.
The key to running successful retargeting ads is making them appealing to your target audience. To get your ads to outshine the competition:
- Keep your copy and design bold, concise, and straight to the point.
- Make sure these ads are only relevant to your potential customer's interests and needs.
- Position these ads on the websites and social channels your audience spends time on.
- Find the right balance between keeping these ads on relevant platforms for as long as necessary, without coming on too strong.
6. Incorporate exit intent popups.
An exit intent popup reminds shoppers of their abandoned cart when the window is idle for a period of time, or if they attempt to leave the page or close the tab.
The secret to their success is ensuring they appear at exactly the right time—and with the right messaging. If messages are irrelevant or your visitors get bombarded with them throughout their shopper journey, they’ll not only be fruitless, but could dissuade shoppers from visiting your site again.
Utilize this tool to its fullest advantage with these three tips:
- Make sure the messaging speaks to what is in the shopper’s cart and creates a sense of urgency.
- Include an appealing offer, such as a limited-time promo code, to persuade the shopper to continue their purchase.
- Avoid using other popups before this stage, and only trigger them when the visitor’s digital body language indicates that they're about to hop ship.
7. Make your website fast and functional.
If your website is hard to navigate and shoppers have to wait for pages to load during checkout, you risk losing customers (and sales). Fortunately, these problems can be remedied by having a fast and well-functioning website and mobile app.
To get your site in tip-top shape:
- Ensure your website's design is intuitive, decluttered, and user-friendly.
- Categorize products logically, and include filters, like color, size, and type, so shoppers can find the item they’re searching for more easily.
- Utilize AI-assisted search to help ensure shoppers are being served only the search results that are the most relevant.
- Speed up your site by compressing images, using a content delivery network (CDN), implementing lazy loading, and caching as much as possible.
8. Be transparent with pricing and policies.
When unforeseen issues arise, like high shipping costs or a less-than-desirable return policy, it can be an instant deal-breaker for would-be buyers. If you want to earn customer trust and convert cart abandoners at the same time, honesty is always the best policy. When in doubt, remember, it’s best to dish out the details sooner than later.
Here are a handful of tips for improving transparency before and during the checkout process:
- Communicate shipping fees, taxes, and any other costs as soon as possible – ideally on the product details page.
- If feasible, provide free shipping options, such as complimentary shipping on standard delivery, or thresholds to encourage users to complete their purchases.
- Display customer-friendly return and refund policies that are easy to understand.
- Inform shoppers of estimated delivery times.
- Let your customers opt in to how they’ll be receiving their shipping notifications (e.g. email, SMS, etc.).
9. Use social proof.
If you think adding a few reviews to your website is a waste of time, check this out: Online reviews can increase conversions by 270%! Why is this form of social proof so impactful? Simply said, it builds confidence and trust in your product and your brand.
To get the most out of this tactic, try these suggestions:
- Display a combination of reviews, ratings, and testimonials on your product pages and checkout page.
- To curb potential abandoners, highlight social proof on your checkout page.
- Shoppers are smart enough to detect fake reviews, so make sure you have a process for vetting review submissions.
What are some cart abandonment best practices?
Along with the strategies we mentioned earlier, adopting these best practices will help you reach your cart abandonment goals even more.
Personalize the shopping experience.
Chances are, you’re already providing some level of personalization on your website. But is it enough? A study by Zendesk found that 62% of consumers think companies could do a better job tailoring the customer experience. To deliver what shoppers want, use customer data to create personalized experiences for every customer, based on their unique preferences and browsing habits.
Pack your product pages with details.
You don’t need to write an essay to provide the necessary details shoppers need to determine if a product is right for them. But you do need some key pieces of information, or else you risk them going elsewhere that does. Start with detailed product descriptions and pair them with high-quality images that showcase the product in an appealing way.
Offer live chat support.
It’s easy to assume that customer inquiries are likely to take place long before checkout. However, questions (and issues) can arise at any time in the conversion funnel. Offering immediate, real-time assistance or chatbots to shoppers during the checkout process can prevent cart abandonment by alleviating frustration and making the final steps of the shopping journey a positive one.
Think about your mobile users.
If you’re only thinking about how to win over your desktop shoppers, stop—mobile shoppers have an even higher cart abandonment rate of 85.65%. Ensuring your e-commerce site or app is mobile-responsive will not only improve the user experience but make it easier for shoppers to cross the hand-held checkout line without any unnecessary hiccups.
Test the cart page yourself.
Instead of guessing what works (and what doesn’t), test it. Performing regular A/B tests on different elements of your checkout process and cart page will help you identify areas that can be optimized for higher conversions. These can include everything from the checkout process to button placements to messaging (including CTAs), and even promotional offers.
Track your cart abandonment.
If you don’t know how many shoppers are leaving their carts behind, and at what point they’re getting frustrated, you won’t be able to fix the problem. Keeping tabs on cart abandonment will help you identify specific pain points that are preventing customers from buying. This allows you to develop strategies to recover lost sales and improve the appropriate steps in the customer journey. Some popular and efficient ways to track abandoned carts are with Google Analytics, on-site heatmapping, real-time notifications, and e-commerce platforms with built-in tracking.
Follow up post-purchase.
It’s awesome when customers cross the digital finish line, but that doesn’t mean your job is over. Nurturing these relationships is pivotal to reducing the likelihood of shoppers abandoning their carts in future visits. After a customer has made a purchase, send them a thank-you email with their order details. You can also offer related products as an incentive for future visits—a great way to curb potential cart abandonment in the future.
Why is reducing cart abandonment so important?
Implementing effective cart abandonment strategies not only benefits e-commerce businesses – it also provides advantages to customers.
How It Helps E-Commerce Businesses
- Data Insights: When shoppers abandon their carts, it can provide valuable insights that can help you make improvements to your website and user experience.
- Improved Conversion Rate and Recovered Revenue: Actively addressing pain points will lead to more completed purchases.
- Increased Customer Retention: By reaching out and going above and beyond for shoppers who abandoned their carts, you can elevate trustworthiness, foster brand loyalty and encourage repeat purchases.
- Competitive Advantage: Customers are more likely to choose an online retailer that follows up and offers incentives to complete their purchases.
- Reduced Acquisition Costs: Cart abandonment strategies are often more cost-effective than acquiring new customers because they focus on shoppers who have already shown interest in your products.
How It Helps E-Commerce Customers
- Enhanced Customer Experience: E-tailers that utilize cart abandonment strategies tend to refine problems in the checkout process, which can result in smoother, more delightful transactions for shoppers.
- Personalized Offers: Emails and incentives can be customized based on the items left in the cart, making them more compelling and engaging.
- Convenience: Cart abandonment reminders can save customers time and effort by allowing them to return to their selections and complete the purchase without having to search for the products again.
- Savings Opportunities: Exit-intent popups and abandoned cart emails can include discounts or promotions that enable customers to save money on products they’re already interested in.
- Strengthened Trust: Strategies like displaying security badges, transparent communication, and following up with cart reminders show customers you care about their needs, which significantly builds credibility.
What role does AI play in reducing cart abandonment?
Artificial intelligence (AI) is doing wonders for online businesses, so it’s no surprise it plays a pivotal role in reducing cart abandonment, too. Here’s how:
It can provide a seamless checkout experience.
AI can streamline the checkout process by pre-filling forms, remembering preferred payment options, and reducing steps required to complete a purchase. This simplification can help prevent frustration and encourage customers to finalize their orders.
It predicts when a customer is likely to abandon their cart.
Machine learning algorithms can analyze user behavior to prevent abandonment before it occurs. AI-enabled personalization and email marketing campaigns then automatically intervene with personalized offers or reminders at the right moment to encourage customers to finish their transactions. E-tailers who employ predictive AI can see an 18% decrease in their cart abandonment rate.
It provides valuable behavioral insights.
AI can help you gain a deeper understanding of why users abandon their carts through the data it collects. This information can then be used to determine the best strategies your online store should implement to address the factors leading to cart abandonment and increase conversions. It can also segment customers based on various attributes, allowing you to tailor your cart abandonment messaging and incentives to each specific group.
It adjusts product prices in real time.
By analyzing factors like customer behavior, product demand, and competitor pricing, machine learning empowers retailers to adjust their prices dynamically, providing greater potential for customers to be persuaded to finalize their purchases.
Win the battle against cart abandonment!
While cart abandonment is challenging, it's not impossible to overcome. By implementing the strategies and best practices outlined above, e-tailers can significantly reduce cart abandonment rates and boost conversions. At the end of the day, every cart counts, so embrace the insights shared here to deliver a personalized experience that will delight your customers and give your bottom line the boost you deserve. Only then will you unlock the full potential of your e-commerce store.
Granify: The Abandoned Cart Whisperer
Our data-driven approach predicts and acts on user behavior in real time, ensuring a more tailored shopping experience that increases conversion rates for the world’s largest e-commerce brands. By continuously analyzing user interactions, we can identify when a visitor to your e-commerce site is likely to abandon their cart, and take proactive steps to prevent it.
Get in touch with our experts today to unlock the power to increase your conversion rate and turn those abandoned carts into completed purchases.
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