It’s no surprise the online shopping ecosystem has exploded in recent years. Quarterly earnings reports from some of the most popular brands indicate steady online sales growth versus brick-and-mortar sales.
A new report from Forrester Research forecasts online sales to grow to $414 billion by 2018, making up around 11 percent of all retail sales. Yet, as many retailers have seen, online shopping faces some unique challenges – such as cart abandonment.
An average of 67 percent of all online shopping carts are being abandoned, leaving behind billions of dollars in lost revenue for retailers. Brands can recoup these losses, however, by first examining the reasons behind the abandonment, and retargeting shoppers with personalized emails in order to motivate them back to the purchase.
By understanding what online shoppers value most – simplicity, transparency and personalization – retailers can convert shopping cart negligence into sales.
Simplicity is key
Consumers value the convenience of online shopping and have come to expect a seamless experience during every stage of the shopping process. The checkout stage is the most critical point of the shopping journey, yet many brands drop the ball by making this process difficult for the end user. According to Forrester, 11 percent of US consumers admitted to leaving a site due to a complex and lengthy user registration form. The registration process must be quick and easy to keep the shopper engaged and focused on completing the purchase. If retailers ask for too much personal information to complete a purchase, consumers may grow frustrated and leave the site altogether. If using a registration form during the checkout process, keep the form simple and straightforward, asking only the most necessary information (i.e. name and email) to keep the user moving forward.
The most successful brands have an easy checkout process involving just a few steps. However, many retailers mistakenly use this time to bombard the user with distracting offers in multiple pages. One study revealed that shoppers are taken through an average of 5.6 pages from cart to order confirmation. Another retailer from the same study took shoppers through a total of nine pages. Not only is this frustrating to the end user, but it distracts the shopper from the end goal: The purchase. If retailers can ensure the checkout process is easy to navigate and efficient, shoppers are less likely to abandon the purchase.
Imagine a budget-conscious shopper enters a site to browse for new yoga pants. After carefully evaluating that her items are indeed within her budget, she decides to complete the purchase. However, after taxes, shipping and other fees she decides to abandon the cart.
This is a common scenario for e-commerce brands that hide the total cost of the product until the very last step. Not only does this discourage shoppers, but it leaves them with a negative feeling about the entire online shopping experience. In this case, the retailer could have avoided the situation by displaying the total cost of the purchase at the start of the checkout process. This sets the customer’s expectations from the start and does not leave them with a negative feeling about the brand or the experience.
Winning over cart abandoners
Even with an easy-to-navigate and transparent checkout process, retailers cannot guarantee a shopper will not abandon a cart.
There are steps retailers can take to further deter abandonment. For example, adding personalized recommendations with quick view functionality to the cart page to enable shoppers to compare similar products on the spot without having to leave the cart However, multiple factors come into play, such as comparing price and product with a competitor and an expectation for free shipping.
This is why it is imperative for online retailers to retarget customers with personalized emails offers and similar product recommendations, products that help reach the free shipping threshold, and relevant recommendations based on the customers most recent activity (including any activity that takes place between the email being sent and opened).
For example, if the cart is abandoned, a retargeting email should be delivered within 24 hours of the cart abandonment, acting as a reminder that the items are still waiting for the shopper or to reengage the customer with targeted offers and personalized product recommendations.
Studies show the open rates for initial email averages above 40 percent. It’s a good idea to create a sense of urgency at this point, such as reminding the customer the item will only be available for a few more hours or that there is a limited supply. The urgency may motivate the shopper to act quickly, return to the site and complete the purchase.
Additionally, personalization technology also serves to promote the imagery and messaging that matters most to each individual shopper based on his or her unique profile. For instance, a retailer could identify that a specific shopper who lives in a cold-climate location only viewed warm weather clothing items on the retailer’s website. The resulting reminder email about the shopper’s cart contents might incorporate warm-weather imagery and recommendations based on this activity, but could also use locational context to deliver suggestions and offers for items relevant to cold-climate locations.
According to a report, 95 percent of shoppers took up to two weeks to complete a purchase after abandoning a cart. Personalization technology is a necessary step in reengaging potential customers with content, offers and products that are most relevant to them in order to convert them into buyers.
Savvy online retailers know that creating an easy and engaging experience will bring shoppers back again and again. Yet, even with access to all the right tools and resources, cart abandonment is not completely unavoidable. However, what retailers can control – user registration, checkout process, transparent pricing, personalized retargeting – will help drive shoppers back to their carts to complete purchases.
To realize ROI, e-commerce sites must closely examine how to make the shopping experience and the checkout process as streamlined and easy as possible. From there, it’s critical that personalized retargeting is utilized soon after a cart is abandoned to capitalize on the shopper’s interest. Brands that heed this advice will benefit from the ever-expanding online shopping market.
Meyar Sheik is CEO of Certona.