When you launch your first online store, it’s easy to get optimistic about sales. For small businesses, an online storefront can broaden their reach and add to their revenue. But it’s more common that they miss out on many opportunities to do so. This is mostly because of shopping cart abandonment—a common problem with online stores.
What Is Shopping Cart Abandonment?
The term “shopping cart abandonment” means that a visitor to your website initiated the buying process, but did not follow through on the purchase.
Maybe they start by clicking on the “Buy Now” buttons on your products or by adding items to their online shopping cart. Then, they leave the website before their transaction is completed. If you have enough of these unfinished transactions, your business is leaking a good deal of potential revenue.
An estimated two-thirds of shopping cart transactions are abandoned, according to a collection of statistics gathered by Baymard Institute. If you’re a small business owner, odds are that you can’t afford to miss out on two thirds of potential orders. The best way to avoid this is to use strategies that reduce shopping cart abandonment. This guide will show you how.
How to Reduce Online Shopping Cart Abandonment: 4 Simple Ways
If you’re just about to open your first online store or if you’re new to eCommerce, we recommend that you go through these guides first:
- eCommerceWhat Is eCommerce?Laura Spencer
- eCommerceHow to Start Your Own Online Store (Beginner Guide)Brad Smith
- eCommerceHow to Start Selling Products Online Successfully (In 2017)Tracey Wallace
Once you’ve set up your online store, it’s now time to optimize it and reduce your cart abandonment using the following strategies:
1. Upfront Shipping Policies
The most important strategy for reducing cart abandonment is to be upfront about your shipping rates and policies.
Users don’t like being surprised by additional expenses. A study from Baymard Institute found that the most common reason why people abandon their carts doing checkout is “extra costs are too high.” A study from FuturePay, a payment processor, had similar findings. They found that "cost of shipping" and "cost of order became too expensive" were the top two reasons why online shoppers abandoned their carts.
From the very beginning of your customer’s shopping journey, present them with clear, simple information relevant to shipping and handling. Avoid introducing additional fees, policies, or confusing shipping at the last step. Here are some ways to apply this:
Have Free or Flat Shipping Rates
Since extra costs are the primary barrier to completing online transactions, remove this barrier by offering free shipping. Usually, businesses offer free shipping by absorbing the shipping costs into their product prices.
Apart from reducing cart abandonment, free shipping offers are likely to aid customers in spending more. In a case study by VWO, a website optimizing service, they found that a free shipping offer increased the average order value by 7-percent for an online skincare shop.
Still, free shipping offers are easier said than done. For many small businesses, offering free shipping can cut into their profits or raise their product prices in a way that they’re no longer competitive. Here are some alternative approaches:
- Free Shipping Threshold. Rather than offering free shipping across all orders, have a minimum order value that customers should reach if they want to qualify for free shipping.
- Flat Shipping. Alternatively, you can take the surprise out of shipping fees by offering flat shipping rates across all orders.
- Discounted Shipping. You can also offer shipping rates that are discounted or lower than expected. For example, Sportchek, an eCommerce store for athletic wear, standard shipping is free for orders that cost less than $20 to ship. If your shipping rates are higher because of your delivery address or the type of shipping you prefer, you’ll have to pay the balance that exceeds $20.
- Restricted Free Shipping. Your online store might make your products available for sale all over the world, but your free shipping offer doesn’t have to be as expansive. You can restrict free shipping offers to specific countries or regions. In the example below from Republic of Tea, free shipping is restricted to U.S. domestic orders. It also combines a free shipping threshold offer, since orders also have to be over $59 to qualify.
Display Total Order Cost Estimate
The most common reasons why people abandon their online carts isn’t just about shipping per se, it’s about the total cost of the order. From the Baymard Institute study cited earlier, 24-percent of users abandon carts because "I couldn't see/calculate total order cost up-front." In other words, simply showing an accurate estimate of the total order can help avoid cart abandonment.
To make sure that you build the right expectations with online shoppers, display an accurate estimate of the total order cost at all times. Include tax, shipping and handling, and other fees. Every time the user adds another item or makes changes to their cart, the estimated total should change accordingly. For Threadless, a shirt company, their online shopping carts automatically estimate additional charges and factor them into the total:
There’s also a more manual approach, such as the example from BucknBear Knives below, which asks the user to fill up some shipping location information to get a more accurate shipping and tax estimate:
2. Follow Up on Open Carts
Sometimes, you can win back those people who have already decided to abandon their carts. These follow-up strategies can encourage customers to complete their transactions:
You can trigger special offers to appear on the screen just before a user attempts to close the window or leave their shopping cart. These offers should entice users to keep shopping or to complete the checkout process. The offer is typically a discount or a freebie.
Xero Shoes, for example, displays the following pop-up offer a few seconds after you’ve opened your shopping cart for the first time. For users who were thinking of dropping their carts, an offer like this could encourage them to follow through with the purchase.
If shoppers are required to send in their email address when they first add items to their cart, you can easily send email notifications to remind them of incomplete transactions. According to eMarketer, click through rates of cart abandonment email notifications can be as high as 40-percent. Click-to-purchase rates are at around 30-percent, which suggests that some online shopppers do intend to complete their transactions when reminded.
In one case study for Peak Design, which sells outdoor camera gear, the company was looking to use email marketing to recover abandoned shopping carts. For this campaign, they sent their first notification email 30 minutes after the cart is abandoned. They followed this up 30 hours later with another email, this time with a discount offer:
As a result of these emails, Peak Design was able to recover 12-percent of abandoned shopping carts by sending out emails.
In other words, getting the email addresses of your shoppers is essential, especially if you want another chance at recovering their unfinished transactions.
In fact, you should send your first emails within an hour of the user abandoning their cart. Data from Barilliance, an eCommerce optimization service, found that the best conversion rate (20.3-percent) for the first email reminder happens within the first hour. If you wait longer, it lowers the chances of users completing their transactions.
3. Make Users Feel Secure
Another barrier that users face when completing the checkout process is their worries about security. A survey from FuturePay found that 38-percent of online shoppers are concerned about the website not being safe or secure enough.
How do you address your online customers’ security concerns? Consider the following strategies:
Use Recognizable Trust Logos
It’s important to have visual markers reminding users about the security of your website. These visual markers are usually a badge or seal with an image of a lock or a checkmark, showing that the site has been verified.
Most eCommerce stores use many different trust badges. You might have SSL (Secure Sockets Layer) seals from Norton, Symantec, and other SSL providers, showing that communication between your website and the user’s browser is encrypted.
You might also have accreditation badges from the Better Business Bureau, Google Trusted Store, and others, showing that your business has been verified. There are even trust seals that are just graphics or icons of locks, without being accredited by a third party.
But most online shoppers are not privy to the differences between these trust seals. In fact, most users often go by the familiarity of the brand or organization on the logo. A study from Conversion XL found that seals from familiar brands like PayPal, Norton, and Google were the most trusted.
While your online store does need to be technically secure, you still need to reassure customers in a way that they understand. Get familiar brands on your security badges so that your users can feel more confident about putting their credit card information into your forms. Keep this in mind when you’re creating your eCommerce store.
Prominent Security Indicators in Payment Sections
The closer a user is to sending in payment information, the more you have to emphasize your site’s security. In Baymard Institute’s checkout usability study, they found that users trust the parts of the checkout process that are closest to the trust seals—even if the other parts are equally secure. They also found that users, when shopping on sites of lesser known brands, are more likely to raise concerns if there are no visual cues emphasizing security.
Addressing these concerns means highlighting security badges and features near the payment section of the checkout process. For example, GrowlerWerks, an online store that sells microbrew equipment, reminds users that transactions are secure and encrypted just as they're entering their payment information. It might be better if recognizable trust seals are also next to the payment form, but for now the small padlock icon next to the credit card number field will have to do.
Checkout Process Should Be Glitch-Free
Finally, your website should be free from glitches or errors, especially within the checkout process. The Baymard Institute study indicates that 22-percent of online shoppers abandon their carts because the website had errors or crashed.
To avoid glitches and errors, test your entire checkout process from start to finish. Follow-through on at least one transaction. Use both desktop and mobile devices as well. Any transaction fees or shipping costs you need to pay during this test is just a small price to pay for ensuring that your online store loads fast and error-free.
4. Simplify Checkout Steps
Users are unlikely to go through with checkout if it takes several steps to get there. From the Baymard Institute study, “too long/complicated checkout process” was the third most common reason why people abandoned their online carts. In other words, minimizing and simplifying checkout steps can help people feel more at ease with completing their transactions. Here are some tips on how to achieve this:
Remove Mandatory Account Registration
Online shoppers don't like registering new accounts on a website just to check out a purchase. Thirty-five percent of online shoppers don’t follow through on transactions because they’re required to create an account on the site, according to the Baymard Institute study. A similar survey from Visual Website Optimizer also found that 23-percent of online shoppers abandon carts because they "had to create a new user account."
Since a small business eCommerce site can’t afford to lose one-third of potential transactions, it’s best to make account registration optional instead.
In the example below, Finn Utility, an online shop that sells fly fishing gear, has optional registration. While shoppers can still register for an account, they can also check out without doing so:
Use Fewer Than 8 Form Fields
The average checkout process contains 14.88 form fields, according to Baymard Insitute’s checkout usability study. But, their eye-tracking studies found that the greater the number of form fields, the poorer the usability of the checkout experience. They found that "a fully optimized checkout flow can be as short as 7 form fields."
You can reduce form fields by having a single field for the customer’s full name or collapsing optional fields such as “Address 2” or “Company Name” (see below.) You can also leave the billing address collapsed if the user chooses that the billing and shipping addresses are the same. These techniques reduce the visual clutter and make the checkout process appear as simple as possible.
Use a Progress Indicator
It also helps to give users an idea about how long the checkout process is and which step they’re currently in. A progress bar or indicator can help.
Research from the University of Toronto found that people prefer to have progress indicators on the user interface when completing a task. In a split test conducted by LeadPages, an opt-in form with a progress bar had 28-percent more conversions than one without. If users know how many steps are left in the checkout process, they can feel less overwhelmed and focus on the task at hand.
Your progress indicator doesn’t have to be complicated. Mollyjogger, an online store for outdoor equipment, has a simple progress bar in their checkout process. Above the form is a line of text indicating the different steps: Customer Information, Shipping Method, and Payment Method. The part that’s in bold, dark letters identifies the checkout step you’re currently in.
Don’t Let Online Shopping Cart Abandonment Hurt Your Business
When it comes to closing sales on your online store, you can always do better. You can beat the odds and don’t have to miss out on most of your potential orders. Start by testing one or two of the above tips and measure the results for yourself. Once you’ve followed through on most of the above strategies, your conversion rates will be higher and business can grow bigger.
Editorial Note: This content was originally published in 2017. We're sharing it again because our editors have determined that this information is still accurate and relevant.
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