It’s been described as the bane of the online retail industry, and for good reason: shopping cart abandonment costs retailers over $USD4 trillion per year. And to make matters worse, it doesn’t have to be this way – 63% of this could be recovered, experts say, if only merchants were a little more savvy.
But is it really that simple?
In an era where the digital landscape is changing rapidly, it’s easy to blame online retailers for simply not keeping up. Many retailers, for example, still focus on their desktop shopping experience, despite the fact that users now spend far more time on the mobile web.
Blaming retailers entirely, however, potentially ignores the bigger picture. When shopping online, many consumers don’t go directly to a retailer’s site – they arrive there via a shopping aggregator, or social media site. Given that research shows consumers increasingly visit an aggregator prior to making a purchase, do these sites also have a role to play in decreasing shopping cart abandonment, and ultimately helping retailers increase sales?
Shopping cart abandonment – how bad is it?
When it comes to shopping cart abandonment, it’s fair to say that the situation is pretty dire. In 2016, the global average for cart abandonment was over 77%, which was in fact an increase from the 2015 rate of 71%.
One of the main reasons for this increase was the percentage of users shopping on their mobiles. Cart abandonment statistics on a mobile are the most dire of them all: an incredible 86% of consumers abandon their merchandise when shopping on their phone.
This statistic is one that retailers increasingly need to pay attention to. After all, we are now spending 2.8 hours per day on our smartphones (which equates to more than 51% of our total browsing time).
Unsurprisingly, the high cart abandonment rate significantly contributes to a poor mobile conversion rate overall. Global statistics show that mobile conversions rates remained relatively stagnant last year at 1.55%, compared to their desktop counterparts at 4.14%. So it’s fair to say that if retailers want to capitalise on the fact that smartphones are becoming our shopping tool of choice, much needs to be done to optimise our experience there.
Are retailers to blame?
From a mobile perspective, there is indeed a lot more retailers could be doing – after all, up to 91% of small to medium business websites are not yet fully mobile optimised.
Mobile optimisation aside, however, there’s far more the average retailer could do to optimise their checkout process and reduce cart abandonment.
Checkout processes too complex and time consuming
From a checkout perspective, customers expect simplicity and speed, yet it seems they usually don’t get it. Research shows that 27% of cart abandonments occur due to time restraints, and a further 23% occur as the checkout process is too complex.
Why is this? Firstly, many retailers require customers to sign-in (or sign up) to check out their items. This takes up an extraordinary amount of the customer’s time, and has so many potential barriers, such as: Does the customer remember the email address they used? Or the password? If they’re new, can they verify their email address?
It’s of little wonder that so many customers fall out of the process during this step.
In addition to clunky sign-ins, some retailers tend to make checkout process too complex. If a customer has to move through multiple screens, for example, with no end in sight and no idea how far they’ve progressed, and they simultaneously have to fill out multiple form fields, they’ll undoubtedly give up quickly.
Payment and shipping issues
If you’re an eCommerce retailer, one of the most important things you need to get right is your payment and shipping options – or you risk an exponential increase in shopping cart abandonments.
According to research by Hubspot, five of the eight reasons that customers abandon their shopping carts are related to payment and shipping problems. When it comes to payment, there are many interrelated issues retailers need to solve for their customers, such as: Do I provide my customers with the payment options they need? Do they work on a mobile? Do customers feel comfortable with my website security?
Similarly, customers need to know that retailers have the shipping option they’re after (express, standard, courier, etc.), and overall, that shipping and payment processing costs combined don’t lead to an intimidating price spike (one study found that 9 out of 10 customers find free shipping and no payment processing charges to be the most important factor when shopping online).
There are a few reasons for shopping cart abandonment that are simply out of the control of retailers, and some elements of consumer behaviour definitely fall in this category. For example, some customers are simply browsing or researching when shopping online, and the ‘experience’ in the online shop may not actually impact the outcome: they never intended to buy in the first place.
Customers also might walk away or get distracted when completing their purchase, or they may run out of time to complete the checkout (this is especially true on a mobile, and very difficult for the retailers themselves to control).
Are we ignoring the bigger picture?
To blame retailers entirely for shopping cart abandonment, though, is to fail to look at the broader user experience picture. After all, many consumers won’t go directly to a retailer’s site – they will arrive there either from a social media app, or an aggregator site.
The fact that consumers are increasingly shopping in this way is a trend that retailers can’t afford to ignore. According to Forrester, of the 2.8 hours per day we spend on our phone, 80% of this is spent within our top 5 apps, which for most of us includes multiple social media sites. Increasingly, social media is becoming our online shopping destination of choice – hence the rise in social commerce, a type of shopping where we use social media sites to purchase directly.
Even if we don’t use social media to make purchases directly, we are definitely using it to discover new brands. Research shows that retailers now spend an incredible $23.68 billion on social media advertising, and it is now widely regarded as the most effective way to reach new and existing customers.
Another successful way to reach customers (and similarly, a trend that retailers shouldn’t ignore) is the fact that during the ‘research’ phase of their purchasing journey, many customers choose to visit an aggregator. In fact, research has demonstrated the proportion of customers purchasing through an aggregator site is climbing, as they find such sites far more trustworthy and convenient than conducting research in any other way.
So this begs the question – is there more that social media and aggregator sites could (and should?) be doing to decrease shopping cart abandonment?
The potential for autofill
Given the amount of time we’re spending on social media sites, and the amount retailers are spending advertising there, it’s no wonder social commerce is on the rise.
However, early attempts by social media sites to capitalize on this trend have largely been unsuccessful. Facebook, Twitter, and Instagram have all tried to introduce a ‘Buy button,’ where a customer can purchase directly without leaving their respective apps, but results have been lackluster at best, with most of the buttons stuck in beta test phases, or as is the case with Twitter, abandoned completely.
Although there has been many issues preventing the buttons from being successful, two reasons have been most prominent. Firstly, retailers have had to integrate the button (which is a big ask, given that most retailers still don’t have mobile-optimised websites) and secondly, the buttons take customers straight to checkout, hence circumventing the all-important ‘research’ phase of the customer buying journey.
One service that has potential to succeed where this solution has failed is autofill. Through using intelligent autofill that doesn’t require integration, social media sites can offer their users the ultimate shopping experience.
With autofill, users can respond to an advertisement, be directed to a retailer’s site, and then when they arrive at checkout, they can complete the checkout process up to 536 times faster as they no longer have to type on their mobiles.
Solving this problem – the ability to not have to type on a mobile – addresses one of the most problematic elements of shopping cart abandonment. This issue alone causes up to 37% of all abandonments, and is widely considered one of the biggest impediments to increasing overall mobile conversions.
The benefits of such a service for social media sites, and retailer sites alike, are clear. Firstly, social media sites will be able to improve the ROI for retailer’s advertising spend, which in turn will enable them to sell more advertising. Secondly, retailers will benefit from a vastly increased conversion rate – statistics suggest that customers are up to 2.2 times more likely to convert using autofill, which is enough to put a significant dent in the $USD 4 trillion that retailers lose through cart abandonment each year.
Aggregator sites could also benefit from the same service, albeit even more directly. Most aggregator sites profit directly from conversions – they receive a commission every time a customer purchases something from the end retailer. By helping retailers to convert more customers, they too can increase their profits, so it’s most certainly a win-win.
We won’t solve shopping cart abandonment overnight, but that shouldn’t stop us from trying. Retailers can (and should) do their part; but if we look at our online shopping experience holistically, social media and aggregator sites also need to contribute in helping to increase conversions and decrease lost revenue, once and for all.
Fillr has built the world’s most intelligent and accurate autofill that will seamlessly integrate into your app. Contact us today to find out how our technology can help your customers to transact faster and more effectively, boosting your conversions and revenue.