Reasons for Shopping Cart Abandonment in E-Commerce

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Reasons for Shopping Cart Abandonment in E-Commerce

Any entrepreneur/retailer or anyone operating an ecommerce store has experienced the phenomenon of the abandoned cart, also known as a dropped basket. This occurs when customers cancel a purchase at the last step of the online process. They selected the product, made the decision to buy it, but abandon the cart at that very last instant. These are missed opportunities which according to some studies account for trillions of loss in sales. Therefore, it is of great importance for retailers to understand the reasons why basket dropping occurs in the first place. Jeanjean identified four major reasons for cart abandonment, which are complemented by useful tips to avoid them, reducing the percentage of dropped baskets:

1. UNEXPECTED COSTS: Concealing costs until the very end of the customer journey has been found to be not only infuriating for customers but a long-term ‘turn-off’ that leads to customers abandoning their purchase. For the retailer, this inevitably results in missed sales and might have a negative impact on future brand engagement.
   ⇒ Tip:The best way to prevent this from happening is for the retailers to be transparant and honest and present all costs upfront (delivery fees, handling and packaging fees, VAT etc.)
2. ‘NO THANKS, I'M JUST BROWSING’: One of the most common problems facing retailers is consumers browsing with no intention of buying. Some studies show that 99% of first-time visitors will do just that. Although consumers are time-tight they still think through their decisions – they want to reflect on the product before committing to purchasing it.
   ⇒ Tip: There are many strategies retailers can employ to tackle this issue: get email retargeting and display retargeting triggered at the right time after the cart gets abandoned; collect and use data to understand what interested consumers on the webpage, and perhaps offer combo deals with other products in order to maximize sales potential at the point of purchase. Google Analytics can be used to identify the ‘hottest’ products on your website, i.e. the ones that most customers have clicked on and engaged with.
3. BETTER OFF ELSEWHERE: It is important that retailers recognise that they might not be offering the best deal and monitor what competitors are offering both from a product and a service point of view. This type of cart abandonment is most common in low-cost, commodity-heavy baskets, where a disparity in price rather than quality is the determinant.
   ⇒ Tip: Retailers should frequently check what their closest competitors are doing and adjust their offerings to win the sales over the competition while being aware of costings and profit margins at all times. Using retargeting to emphasise services that competitors don’t offer then becomes important – these could be ‘free shipping’ or faster delivery, better presentation and packaging options, gift wrap availability, dispatch and delivery times, return and refund policy. For example, in my online store, as soon as we offered free shipping on purchases over £20 (average item price is £9), we’ve observed a 25% rise in the number of orders in the first 3 months of introducing this offer to customers.
   
4. MOVING FORWARD: 44% of consumers will abandon a purchase as a result of slow loading pages, or technical issues. Therefore, these and other threats to engagement should be avoided. It’s especially important for retailers to make sure their webpages are mobile friendly as studies show that the number of purchases made through hand-held devices has been constantly increasing.
   ⇒ Tip: A number of tools are available to retailers that can be used to analyse how fast it takes for the webpage to load, how long consumers spend on each page, which products/services they click on, when they leave the webpage etc. Making good use of this data can prevent the retailer from missing sales opportunities in the future.

In conclusion, a guaranteed way for retailers to improve sales is to act and deal effectively with the above mentioned cart abandoning reasons. Dropped baskets cannot be completely stopped from happening because they are a natural consequence of customer journeys. But understanding them and avoiding them as much as possible will surely have a positive effect on the bottom line.
My advice for entrepreneurs running an ecommerce business is to identify these issues early and take action.

⇒ What is your experience with dropped baskets? Have you applied any of the above-mentioned techniques? Did they work?
Sources: Thomas Jeanjean - Death of the Dropped Basket: Pipedream or the Future of Retail? Posts by Thomas Jeanjean