What is the Average Cart Abandonment Rate?

As an online retailer, you may have noticed that not all customers who add products to their shopping cart actually complete the purchase. This phenomenon is referred to as cart abandonment. In this article, we will explore the topic of cart abandonment and discuss the factors that contribute to it. Additionally, we will offer tips for reducing this rate and improving your sales in the long run.

Why Do Shoppers Abandon Their Carts?

There are several reasons why shoppers may choose to leave items in their carts instead of completing the purchase. One of the primary reasons is cost. Customers may decide the total cost of the products plus the shipping and handling fees are too high for them. This may be due to a lack of transparency on the cost breakdown or sudden price increases.

Another common reason for cart abandonment is a complicated checkout process. Customers may feel frustrated with the number of steps required before completing the transaction. This is especially relevant when users are directed to another page to enter their credit card details or if there is an unexpected request for additional information just before the purchase goes through.

Finally, customers may abandon their carts due to a lack of trust in the website or store. This could be due to unfamiliar product details, a lack of customer reviews or an impression that the company is not trustworthy.

One additional reason for cart abandonment is the lack of payment options. Customers may prefer to use a specific payment method, such as PayPal or Apple Pay, but if the website does not offer these options, they may choose to abandon their cart. Additionally, some customers may not feel comfortable entering their credit card information on a website and may prefer to use a payment method that offers more security. Therefore, it is important for online stores to offer a variety of payment options to cater to different customer preferences and increase the likelihood of completing a purchase.

Understanding the Psychology of Cart Abandonment

It’s helpful to understand how customers think and behave in order to avoid the negative effects of cart abandonment. Researchers have found that people tend to incline towards impulsiveness or what psychologists call ‘System 1 thinking.’ This means that customers are more likely to take action when there is a tangible reward, or when the checkout process is simplified.

However, customers might have second thoughts about their purchase decision and engage in ‘System 2 thinking,’ which is more analytical and introspective. Customers may hesitate if they perceive the product as risky or if the checkout process seems complicated or unclear. Essentially, the challenge is to lead customers through a clear and intuitive experience so they purchase without the chance to change their minds and be swayed by their cognitive biases.

One way to simplify the checkout process is to offer multiple payment options. Customers may abandon their cart if they don’t see their preferred payment method available. Additionally, offering free shipping or a discount code can provide a tangible reward that encourages customers to complete their purchase.

Another factor that can contribute to cart abandonment is a lack of trust in the website or company. Providing clear and detailed product descriptions, customer reviews, and a secure checkout process can help build trust with customers and reduce the likelihood of abandonment.

Common Reasons Why Customers Leave Items in Their Carts

As we’ve already discussed, there are several reasons why customers abandon their carts. One of these reasons is because they are uncertain about the product they wish to purchase. For example, if a customer doesn’t understand the product description or if there are no customer reviews available, then they may be unsure about the item they wish to purchase and ultimately abandon their cart.

Another reason why customers may leave items in their carts is down to the website design. Websites that are difficult to navigate may put customers off, as well as sites that are visually unappealing. It’s important to design your website in a way that is intuitive and easy to use so that customers feel confident about making purchases.

Lastly, some customers leave their carts because the website they are using doesn’t feel trustworthy or safe. This could be because the website hasn’t been updated, or the checkout process isn’t secure. By ensuring that your site is safe and secure and is properly updated, you can help to put customer’s minds at ease and decrease the risk of cart abandonment.

One additional reason why customers may leave items in their carts is due to unexpected costs. If a customer reaches the checkout page and discovers additional fees such as shipping or taxes, they may feel misled and abandon their cart. To avoid this, it’s important to be transparent about all costs associated with the purchase and provide an estimated total cost early on in the shopping process.

How to Calculate Your Cart Abandonment Rate

Now, let’s discuss how to calculate your cart abandonment rate. To do this, you will need to divide the number of completed transactions by the number of shopping carts created. The percentage that you get is then your cart abandonment rate. For example, if there were 100 shopping carts created and only 60 completed transactions, the abandonment rate would be 40%.

It is important to keep track of your cart abandonment rate as it can provide valuable insights into the effectiveness of your e-commerce website. A high abandonment rate may indicate issues with the checkout process or pricing, while a low abandonment rate may suggest that your website is user-friendly and offers competitive pricing. By regularly monitoring your cart abandonment rate, you can make informed decisions to improve your website and increase conversions.

Industry Benchmarks: What is a Good Cart Abandonment Rate?

You may be wondering what a good cart abandonment rate is. Unfortunately, there is no ‘one size fits all’ answer to this question. The ideal abandonment rate for your business depends on a variety of factors, including your industry, your target market segment, your product line, and your sales volume. As such, you’ll want to compare your rate to industry benchmarks which you can find online in reputable industry reports or by using market insights data from the company you’re using to execute your online sales strategy.

How to Reduce Your Cart Abandonment Rate

Reducing your abandonment rate is crucial to increasing your sales and growing your business. Here are some tips to help you reduce your cart abandonment rate:

• Simplify your checkout process. Remove unnecessary steps and ensure the entire process is easy and intuitive for customers.
• Optimize your website design. Make your site visually appealing and easy to navigate so that customers enjoy using it.
• Provide clear and transparent shipping fees to avoid any nasty surprises for customers.
• Display trust signals like online reviews, money-back guarantees, or security certificates during checkout for ease of mind.

Tips for Optimizing Your Checkout Process

Here are some additional tips to optimize your checkout process and reduce the risk of cart abandonment:

• Allow guest checkout so that customers don’t have to create an account.
• Use address lookup features to make the form filling process as effortless as possible.
• Clearly display product images and descriptions to ensure customers know exactly what they’re buying.
• Provide a progress indicator so that customers are aware of how many steps they have left to go before completing their purchase.
• Offer multiple payment options.

The Role of Email Marketing in Reducing Cart Abandonment

Email marketing is a useful tactic in reducing cart abandonment rates. By automatically sending out a reminder email to anyone who has left items in their shopping cart, you can effectively bring them back and complete the purchase.

These emails should be personalized and include information about their cart’s contents as well as a clear and eye-catching call-to-action. Additionally, offering incentives like discounts or free shipping might be the nudge your customer needs to complete the purchase.

Leveraging Retargeting Ads to Bring Customers Back to Their Carts

Retargeting Ads are another effective tactic for reducing cart abandonment rates. These ads appear on social media or search engine results, strategically placed to target someone who has abandoned their cart on your website. By retargeting customers with ads that highlight the products they left behind and time-sensitive promotions, you can increase the likelihood of a customer returning to their cart and completing the purchase.

Best Practices for Recovering Lost Sales Due to Cart Abandonment

Recovering lost sales due to cart abandonment is crucial to increasing your revenue. In order to do this, it’s essential to implement an effective remarketing strategy that includes email marketing, retargeting ads, and cart abandonment recovery campaigns.

It’s also important to identify the most common reasons for cart abandonment on your site so that you can remedy them and prevent it from happening in the first place.

The Impact of Shipping Costs on Cart Abandonment Rates

Shipping costs are a key factor in cart abandonment rates. High shipping charges can deter customers from completing their purchase, which can result in lost revenue for your business. One way to address this issue is to offer free shipping, either with a minimum purchase threshold or for certain items or events such as sales or holidays.

Case Studies: Real-Life Examples of Companies Successfully Reducing their Cart Abandonment Rates

Let’s take a look at two companies who have successfully reduced their cart abandonment rates to inspire you.

Beautylish

Beautylish is an online cosmetics retailer that sought to solve its problem with cart abandonment. To tackle the problem, they redesigned their website and simplified their checkout process. They also added trust signals such as detailed product descriptions and free shipping incentives. These changes contributed to a reduction of 15% in their abandonment rate and an increase in their revenue.

ASOS

ASOS is another company that managed to successfully reduce their cart abandonment rate. They created a timed email campaign that targeted customers who abandoned their cart by sending them personalized emails with discounted offers or free shipping. This effort led to a significant reduction of 50% in their abandonment rate overall.

Future Trends: What Can We Expect in the World of Cart Abandonment?

The world of e-commerce is constantly evolving, and so are consumer behaviors. In the future, we can expect technologies like AI Chatbots, augmented and virtual reality, and seamless shopping on social media platforms to create new opportunities to reduce cart abandonment and optimize the customer journey.

In summary, reducing cart abandonment involves designing an intuitive and convenient process that instills customer trust and addresses their concerns. This requires assessing your website’s design, checkout process, shipping costs, and customer service, establishing a recovery strategy, and tracking your recovery metrics to improve continuously. Follow the tips and best practices described above to boost your sales and remain competitive in the years to come.