Being the sole culprit behind annual losses of $3 trillion for retailers, cart abandonment is an issue that should be given some serious attention.
A panel of online retail experts tackled the problem head on at Performance Marketing Insights: Europe and shared a few examples of how their own companies were helping sellers ease their conversion worries. Yet still, even with sections of retailers labelling things like abandonment part and parcel of an increasingly competitive selling environment, the general consensus is that losses of this scale are something that cannot be ignored.
It is thought that only 2-3% of visitors to an e-commerce site will express an intent to buy on their first browse. Of these, just 29% will complete their purchase, which means 71% of potential customers will abandon their cart before they check-out.
But there is hope on the horizon. After seeing a huge rise in this highly disadvantageous trend over the last five years, retailers, affiliates and ad tech providers are now prepared to go above and beyond to bring card abandonment down from major issue to minor hindrance.
Key contributors to the emergence of cart abandonment range from the self-explanatory to the extremely complex. There is something as basic as overall growth for online retail, meaning there are more companies competing for businesses and forcing their customers to develop a habit for pitting one retailer against another.
Then it is on to more complicated matters such as the rise in mobile ‘shopping’, largely considered to be positive for the industry, but where only a very small percentage of customers on tablets and laptops will buy while they are on their device.
In fact, retailers are even creating whole demographics for groups that will not convert, including those who wish to share products with their friends but have no intention of investing in their business.
Trends like cart abandonment cause a headache for individuals like Henning Scheel, of web traffic optimisation software provider trbo, who talked to PerformanceIN after his stint on the shopping cart conversion panel.
“They [retailers] know cart abandonment is a problem. They know it is growing, and they know they need solutions to address it.”
Scheel says this is a problem weighing heavily on the minds of offline retailers who move to online as a way of boosting sales. However, he says internet technology can also help them get out of this stick situation
“My advice would be to gather the data. When you have the information, you can then decide on your next steps. Keep your eyes and ears open, check the market, and test, test, test.”
Room for improvement
What is evident from some of the more technically oriented members of the industry is that retailers cannot afford to simply accept cart abandonment as a part of their business.
From the perspective of Jay Radia, who also works on web conversion as CEO of software group Yieldify, there are always things retailers can be doing to improve their shopping experiences. Customer segmentation, for example, is an easy way to provide real value for the everyday shopper.
“The key thing for retailers is being able to segment their visitors into different categories. It is really important now that each one of these visitors gets a different message which is appropriate for them,” says Radia.
He adds that consumers are now expecting so much more from online retailers, and a lack of personalisation could encourage them to look elsewhere.
High street help
Still, while online retailers may not like to hear it, some groups even believe that lessons from the offline model can help websites bring an end to high levels of cart abandonment.
As explained by fellow panellist Gregoire Fremiot, director of partnership management at RetailMeNot, online and offline will always walk down very different paths, but websites could do much worse than considering how the brick-and-mortar model encourages shoppers to come in, gather their items and walk straight to the till.
Although this would require a significant investment in research, Sheel believes the logic of ‘spend money to make money’ reads true in this scenario.
“If you’re paying money to have people come to your site, maybe it is worth investing a little more in making sure these visitors also convert,” he states.
Overall, perhaps the biggest reassurance for retailers is that cart abandonment affects every one of their connected parties.
Whether it is an affiliate earning money through conversions or the smallest link in their supply chain, purchasing is the industry’s lifeblood. With this in mind, it seems the force of an industry is behind solving this particularly thorny issue.