The only guide you need about shopping cart abandonment

Seeing a potential client discover an item and make payments quickly is the dream of any eCommerce retailer. The buyer may browse the item multiple times and review the details.

Finally, they add it to their virtual cart. But just as you’re set to receive funds during checkout, the shopper disappears without a trace!

Relatable? Cart abandonment is a common headache for many digital businesses today.

Reports from the Baymard Institute noted that about 70% of online shopping carts get abandoned. That means seven out of ten customers walk away without making a purchase. Indeed, that’s huge.

It even gets worse, as Forrester noted that online retailers lose an estimated $18 billion in annual revenue due to abandoners.

Despite various reasons why clients leave their carts, losing these potential sales can be heartbreaking. 

However, you can reel those customers back in with the right approach and reclaim revenue.

This comprehensive guide will discuss why users abandon the items they intend to purchase, its impact on businesses, and proactive strategies to reduce the rate.

What is shopping cart abandonment?

Shopping cart abandonment occurs when potential buyers add an item to their online carts but exit without making payments.

This uncompleted transaction is a significant issue for eCommerce businesses as it represents lost revenue opportunities.

According to Barilliance research, the global average for cart abandonment is 77.73%.

The rates are higher for mobile devices, with buyers abandoning around 81% of carts due to poor experience or problems during checkout. In contrast, desktop users have a lower percentage of around 74%. 

But there’s more! The study noted that crucial holidays like Black Friday and Cyber Monday experience low rates at 74% and 69%, respectively.

Regional variations also play a role. For instance, Spain experiences a hefty 86% abandonment rate, while the Netherlands sees a lower rate of 65%. 

These stats reveal one thing: you need strategic efforts to reduce the rate at which customers leave the checkout process. 

Why do users abandon carts? Top 7 reasons exposed

Unexpected shipping costs, complex checkout processes, or insufficient payment options are some of the reasons for cart abandonment. Knowing why this situation occurs can help you address the issue promptly.

1. Unexpected shipping costs

Nothing frustrates a client more than reaching the checkout stage only to discover the shipping costs are much higher than anticipated.

This is one of the biggest reasons for cart abandonment. Baymard Institute noted that 48% of shoppers ditch their purchases due to high logistical fees. 

Reducing this cost is essential for eCommerce businesses to prevent cashflow problems, especially during crucial sales periods like the holiday season. Businesses that offer transparency in shipping costs will likely see fewer abandoned carts and enjoy a stable cash inflow.

2. Lengthy checkout process

You’ll lose customers if your checkout process is too long or complicated. When you ask shoppers for unnecessary information, their frustration grows. This makes them more likely to leave before completing their purchase.

An ideal point of sale should be as simple as this format:

Cart > billing info > shipping info > payment > confirmation.

If you have anything beyond this, you risk discouraging your shoppers and ultimately driving them away. Thus, simplifying the checkout process helps you to improve user experience and generate more revenue.

3. Mandatory account creation

Forcing your shoppers to create an account can be a major turnoff, particularly for first-timers. They may not want to spend extra time filling out forms or feel uncomfortable sharing personal information.

Such situations may occur, especially when eCommerce sellers prepare for high-shopping periods like the Chinese New Year.

During such periods, there’s an influx of new buyers who just want to purchase an item quickly.

When you require them to create an account despite their one-time purchases, they may patronize other competitors who allow guest checkout.

4. Lack of payment options

Today’s shoppers expect flexible payment methods.

Many prefer using digital wallets like Apple Pay, Google Wallet, or PayPal to avoid exposing their credit card details online.

Others search for alternatives such as buy-now-pay-later (BNPL).

If you don’t have these available, they may ditch your store and go elsewhere. 

5. No discounts or promo codes

Everyone loves a good deal, especially loyal and first-time shoppers.

If they get to your point of sale and don’t find any discount, these customers may leave you for other rivals that’ll offer them a better option.

To mitigate such risks, you can try incentivizing first-time purchases by offering promo codes to convert them to sales.

An attractive price cut can be the decider for a user to complete their purchase or consider other alternatives. 

6. Payment security concerns

Shoppers want to feel safe when inputting their payment information.

If an online store lacks trust signals like SSL certificates, secure payment badges, or positive customer reviews, consumers may hesitate to complete their purchases.

The fear of data breaches is real. Customers will prefer exiting your website than risk inputting their personal information due to improper security measures.

7. Longer than expected delivery times

Everything moves fast in today’s retail space, and consumers expect quick delivery.

Big brands like Amazon align their delivery windows to shoppers’ expectations with options like same-day or two-day shipping.

If your customers only learn about how long you’ll deliver their items at the checkout stage, they may ghost. This is particularly true with essential goods or gifts that individuals want to arrive as quickly as possible.

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The impact of high abandonment rates on eCommerce businesses

Cart abandonment is a missed opportunity that can cost your business.

When customers leave your online shop without buying, it has a bigger impact than you might think.

Let’s examine the effect of this situation on your brand. 

1. There is a massive drain in revenue 

eCommerce businesses collectively miss out on huge revenue due to shopping cart abandonment.

Whenever a consumer doesn’t pay for their items, it’s like throwing money out of the window.

This significant revenue loss would have supported your growth plans, such as expanding your product line, investing in new technology, or improving customer experience. 

2. You spend more acquiring new customers

When shoppers leave their items behind, it increases the cost of customer acquisition.

Regaining a lost buyer involves using costly retargeting ads, promotional emails, or special discounts.

According to Harvard Business Review, customer acquisition can cost 5 to 25 times more than retaining existing ones. That means each abandoned cart adds extra financial strain, which can limit growth opportunities. 

3. You risk losing your buyers to competitors 

The eCommerce landscape is very fierce, and losing your customers is your competitors’ gain — a situation you want to avoid by all means.

If a shopper ghosts you, there’s a good chance they’ll find a similar product elsewhere. 

This is prevalent in sectors with similar products, and customers can compare prices across multiple sites.

When you don’t appeal to your buyers, you cede more market share to your rivals. 

4. You’ll have trouble with inventory management

High abandonment rates can throw your inventory management into chaos.

When a customer picks a product online, it’s often marked as “reserved.” This is done with the hope that such an individual will buy the item soon.

But that’s not always the case, and this can lead to stocking issues. 

This is evident during peak seasons when every sale counts.

In these periods, you want to have a clear understanding of your inventory to meet users’ demands.

However, when individuals add items to their carts and abandon them, it leads to inaccurate stock levels. 

Ultimately, this disrupts your supply chain and affects your ability to meet consumers’ needs.

5. You could run the risk of a lower customer lifetime value

Frequent cart abandoners can signal a lower customer lifetime value (CLV). This metric refers to the total revenue you can expect from a shopper over the course of your relationship with them.

If clients are leaving your site, there’s a high chance they’ll not make repeat purchases. 

As you struggle to convert these buyers into loyal clients, your efforts to retain them will prove abortive.

However, focusing on reducing cart abandonment helps improve customer retention.

There’s a possibility they’ll return for future purchases, thereby ensuring your long-term profitability. 

6. Customers won’t trust your brand

Building trust is essential for long-term success in eCommerce.

However, when shoppers frequently leave your site, it indicates that it’s unreliable or doesn’t meet expectations.

Over time, this erodes customer loyalty, making them less likely to return or recommend your site to others.

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How to calculate the cart abandonment rate

A high cart abandonment rate does more harm than good.

Therefore, knowing how to calculate this metric is essential for optimal success. It measures the percentage of customers who add items to their cart but don’t complete their purchases. 

To calculate this rate, note the number of shopping carts created and completed purchases in a period. 

Next, use this formula:

• Divide the number of completed purchases by the number of shopping carts created.
• Subtract the result from 1
• Multiply the result by 100 to get the percentage

Mathematically, [1 - ( completed purchasesshopping carts created)] x 100%

💡Let’s consider this hypothetical example:

Assuming that in January 2024, 2000 virtual carts were created, only 500 of these were purchased. Plugging these numbers into the formula:

Cart abandonment rate = [1 - ( 5002000)] x 100% = 75%

So, in this example, 75% of carts were abandoned.

How to reduce cart abandonment and scale higher

Mitigating cart abandonment entails optimizing your checkout, offering multiple payment options, providing transparent shipping costs, leveraging retargeting ads, and highlighting your returns policy. 

These proactive strategies can be game-changing for your eCommerce business. Let’s discuss them further.

1. Optimize your checkout experience

If your checkout is simple and smooth, you’ll get more conversions.

If otherwise, you may find those potential sales slipping through your fingers.

So, what should you do?

‍Reduce the number of steps involved at your point of sale.

In addition, offer a one-click checkout option, which is great for users who may already have their details set in a previous purchase. 

Apple excels in this regard. Its mobile payment service, Apple Pay, offers customers the quickest and most secure way to pay for products via their iPhones, iPads, or smartwatches. It eliminates the need for users to manually input their credit card information every time.

Also, these devices automatically fill in billing information based on saved preferences.

2. Accept multiple payment methods

Not all your shoppers will prefer the same payment method, especially if you cater to a diverse demographic. Therefore, provide a diverse range of payment options, from digital wallets and e-wallets to credit/debit cards. When customers are spoiled for choice, they’re more likely to complete their purchase, hence reducing your abandonment rate and driving significant sales.

3. Offer transparent shipping costs

Shipping costs can be a deal-breaker for many shoppers, especially if the charges don’t justify the purchased items.

To solve this, you can offer free delivery on orders over a certain amount.

Also, strategically include the logistical fees in your product prices.

If none of these options are feasible, you may negotiate with local pickup services and offer discounted shipping rates to your customers.

Remember, be transparent about your shipping costs before your clients check out. 

4. Make your return policy easy for customers 

A well-crafted return policy can work wonders in preventing clients from ghosting you.

Customers often hesitate to pay for an item because they’re unsure if it’ll meet their expectations.

However, when you clearly state that your returns are easy and hassle-free, you alleviate these fears. 

Interestingly, when your return policy is prominently displayed during checkout, you can drive conversions faster. Research shows that 16.5% of purchases are returned, highlighting how important it is to have a system in place. 

When shoppers know they can get their money back as easily as they can spend it, they feel more confident about hitting that “buy” button.

5. Leverage cart recovery emails

Cart abandonment isn’t always the end of the road for many!

Therefore, you can win back those potential customers with smart retargeting ads and follow-up emails.

In fact, these messages have an impressive open rate of over 45%.

This means that one in two individuals who receive such an email will click it and likely pay for their items.

So, remind users to complete their purchases and even offer discounts to spur them to action. Ensure your messages are well-timed and personalized to improve recovery rates.

6. Invest in a trustworthy eCommerce platform

The foundation of a smooth shopping experience is trust.

As such, it’s beneficial to choose a platform that will ensure your site is responsive and operates seamlessly across devices.

If it’s slow or difficult to navigate, especially on mobile phones, you’ll discover more clients abandon their purchases for somewhere better.

A solid platform enhances the user experience and helps build customer trust. This investment pays off, especially when running high-traffic sales events like Black Friday deals or holiday shopping.

7. Create a social commerce strategy

Social commerce is the practice of selling products on networking platforms, and it’s a fast-growing trend.

When you make your checkout process seamless across platforms, you’ll reduce the chances of users leaving mid-purchase. 

Rather than redirect users to your online store, provide efficient payment methods that’ll spur them to pay quickly.

Also, don’t forget the power of social proof. Include customer testimonials or reviews on your social media pages to build trust. It will assure shoppers you’re reputable and trustworthy.

This increased confidence will enable them to make repeat purchases. 

While these strategies help with abandoned cart recovery, it’s vital to note that they can’t make all customers return.

However, reducing abandonment rates helps convert potential sales into actual revenue.

Ultimately, you’ll be able to stay ahead and stand out among your rivals in this competitive eCommerce landscape.

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5 easy ways to optimize your customers’ shopping experience 

Having an optimized shopping experience is beneficial in generating more sales. Imagine entering a physical store with unarranged aisles, rude staff, and confusing signs.

That would be frustrating, right?

The same thing applies to a digital shop.

If your website isn’t easy to navigate, lags, and not user-friendly, shoppers will leave immediately.

Consequently, you should cultivate an environment that makes it easy for your customers to find and buy what they need.

Here are aspects to focus on to ensure your shoppers stay around your site longer.

1. Make sure your website is easy to navigate

Your categories should be clear, and products must be easy to find. Integrate a well-organized menu and search function to help customers quickly find what they want.

2. Improve your site’s load time

Speed matters a lot, so ensure faster load times for your site.

If it lags, your shoppers will look elsewhere.

So, keep them engaged and spurred into making payments via your fluid interface.

3. Optimize your website for mobile shoppers

Mobile devices contribute to over 50% of web traffic.

As such, you’ll find customers using their smartphones to browse and shop in your online store.

So, ensure your site works and is optimized for all screen sizes. 

4. Streamline your checkout process 

You should ensure the payment process is straightforward. A complicated one will frustrate customers and make them ghost you.

Also, offer multiple payment options and make sure shoppers can review and edit their carts before checking out.

5. Provide easy access to customer support

No online store is pitch-perfect! Your clients may be stuck in the payment phase or want to make inquiries.

Thus, ensure you have active agents to help them out. Y

ou can also integrate multiple modes, such as live chat, email, or phone support, to help resolve queries quickly.

When you readily offer help, shoppers are more likely to complete their purchase.

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Get the best financing deals with Stenn

The reality of cart abandonment is clear: every lost sale is a missed opportunity to increase revenue. It’s not easy to see a customer show initial interest and then leave without making a purchase.

For obvious reasons, there’s an urgent need to resolve these issues.

Thankfully, you’re now well-equipped with clever strategies that can reduce the rate at which shoppers ghost your store.

As you employ these tactics, it’s equally important to recognize that you also need quick and reliable funding to maximize your efforts and boost growth. 

That’s why partnering with Stenn can be beneficial to your digital business needs.

Say goodbye to long waits or complex paperwork.

With our lightning-fast revenue-based financing, you can access the funds you need to boost your inventory and your overall sales within 24 hours. 

Ready to keep the momentum going? Partner with us and watch your conversions soar!