Opportunities to Cash in on Abandoned Carts
Attracting customers is always important. But ensuring they complete their online purchases is absolutely crucial.
Online shopping already accounts for more than $3.5 trillion in sales worldwide and was expected to represent nearly a quarter of all retail commerce by 20231. But with the outbreak of the COVID-19 pandemic, those expectations have fundamentally expanded.
Indeed, 80 percent of shoppers shifted at least some of their in-store spending online during the pandemic2. And with consumer spending under pressure, “merchants simply cannot afford to miss out on digital sales due to poor payment experiences,” concluded 451 Research3.
Surveys show a staggering 88 percent customer dropout rate at the online checkout stage near the start of the pandemic4, with as many as 38 percent of consumers in the U.K., for example, abandoning items in their shopping cart at least once a week5. For online retailers, this loss of sales can have a dramatic impact on potential revenue. But at the same time, it presents a major opportunity to convert digital shoppers.
88% customer dropout rate at the online checkout stage near the start of the pandemic4
80% of shoppers have shifted at least some of their in-store spending online during the COVID-19 pandemic2
If retailers could reduce the dropout rate—even by a small percentage—billions in untapped revenue could be gained. In fact, even before the surge in COVID-related e-commerce sales, a 2019 investigation into cart abandonment rates revealed that $260 billion in potential sales could be salvaged by improving the online shopping experience6. And with e-commerce sales in the U.S., for example, up an estimated 44.5 percent7 by the middle of 2020 compared with a year earlier, this opportunity to ensure against potentially lost sales becomes even greater.
Going forward, how can retailers win more customers and turn an ongoing industry weakness into one of the greatest revenue opportunities for e-commerce?
Your business can start with the following strategies that will help you cash in at the cart.
1. Remove Unnecessary Steps at Checkout
A landmark study of major online retailers found that 26 percent of U.S. shoppers abandon their carts because of complicated and time-consuming checkout processes.8
Customers cited unnecessary steps, such as:
- Filling out separate name and address fields
- Providing separate home and billing addresses
- Creating an account prior to purchase
One technology that is key to delivering a frictionless online checkout experience is Discover® Secure Remote Commerce (SRC). This new globally interoperable checkout solution enables a Click to Pay checkout experience that is more simple, streamlined and secure. By streamlining the customer payment process—eliminating passwords and the need to repeatedly fill in payment and shipping information, for example—studies suggest that the final payment steps can help retailers capture many of the customer transactions that are otherwise lost.
26% of U.S. shoppers abandon their carts because of complicated and time-consuming checkout processes7
2. Provide A Variety of Payment Methods
Online retail is now a global phenomenon. So, it’s more important than ever to offer a variety of payment methods to satisfy the needs of not only your local base, but international customers as well. One recent survey found that 48 percent of cross-border shoppers in the U.S. abandoned a purchase because their preferred payment method was not available9.
In fact, one out of five online shoppers globally reported similar reactions—leaving their shopping carts because they could not pay with the method they wanted, with consumers in the Americas and India most preferring traditional payment cards, according to a survey by UPS10.
3. Show Customers the Cards You Accept
When it comes to improving your customers' payment experience, it's not just about simplicity and variety but also transparency.
Among the most important steps to improve the customer experience is to let customers know what card brands are accepted. While credit and debit cards remain the most popular payment methods worldwide, mobile wallets have found greatest appeal in India and online payments are most popular in Europe11.
For example, by showing acceptance of Discover Global Network cards, merchants not only conveyed acceptance of Discover Cards from the U.S. and Diners Club International®, but also opened their business to international cardholders, including Troy (Turkey), RuPay (India), BC (South Korea), Elo (Brazil) and more.
4. Remove Account Creation at Checkout
In one study of online shoppers, 34 percent said they abandoned their carts at checkout because they had to create a new account before they could buy12. Consumers demand speed, simplicity and ease when they are paying for their goods. Creating a new account is the last thing on consumers’ minds, especially as new online offers abound as the ongoing pandemic pushes merchants online and competition increases.
34% of online shoppers said they abandoned their carts at checkout because they had to create a new account before they could buy11
Instead, merchants should consider innovative UX ideas, such as partial account creation—where only an email and password are needed—or a “shopping as a guest” option. These simple changes can play a major role in the potential success of your business.
The long-term gains? Brand loyalty and incremental sales.
5. Seize the Potential of Autofill
Just as contactless has revolutionized in-store speed at POS, autofill has transformed e-commerce by creating a faster, shorter and more seamless checkout experience.
It's not just time being saved. It's sales, too. Some people use autofill as a way to remember their details when they don't have their card number readily at hand.
Yet, to benefit from the increased conversion rates autofill can bring, e-commerce sites and text fields within it need to be set up correctly. A poorly designed form that does not populate in a matter of seconds can be a significant source of frustration–even enough to lose a sale.
Let Simplicity Be Your Guide
Creating a simple, intuitive customer experience may lead to big rewards:
- Streamline steps at the checkout
- Accept a wide variety of payment methods—and clearly show which ones
- Don't force customers to create an account
- Optimize your site for autofill
If online retailers used just some of these strategies, previous studies showed that customers' overall conversions would improve by 35 percent.13
For any global e-commerce business looking for increased sales and improved customer satisfaction, the opportunity is clear. And especially in this time of social distancing and in-store restrictions, there is no better way to help boost online sales than encouraging customers to complete their purchases by streamlining their journey.
For more information, Download the Protecting Online Sales from Abandoned Carts Infographic
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References
1Statista, October 2020. E-commerce worldwide - statistics & facts. Viewed 4th November 2020.
2 451 Research, 2020. COVID-19 Update: 2020 Trends in Customer Experience & Commerce. Viewed 4th November 2020.
3 451 Research, 2020. COVID-19 Update: 2020 Trends in Customer Experience & Commerce. Viewed 4th November 2020.
4 SaleCycle, March 2020. How Coronavirus is Affecting Ecommerce: Stats. Viewed 4th November 2020.
5BigCommerce and Klarna, Navigating needs. The path to profit in eCommerce, June 2020. Viewed 4th November 2020.
6 Baymard Institute, 2019, 40 Cart Abandonment Rate Statistics, Viewed 2nd November 2020.
7 U.S. Department of Commerce, 2020. Quarterly Retail E-Commerce Sales. Viewed 18th November 2020.
8 Baymard Institute, 2019, 40 Cart Abandonment Rate Statistics, Viewed 2nd November 2020.
9 451 Research, July 2020. Moving Payments From Commodity to Commerce Catalyst Through Optimization and Orchestration. Viewed 5th November 2020.
10UPS, 2019. UPS Pulse of the Online Shopper. Viewed 4th November 2020.
11UPS, 2019. UPS Pulse of the Online Shopper. Viewed 4th November 2020.
12 Baymard Institute, 2019, 40 Cart Abandonment Rate Statistics, Viewed 2nd November 2020.
13 Baymard Institute, 2019, 40 Cart Abandonment Rate Statistics, Viewed 2nd November 2020.
The information provided herein is sponsored by Discover® Global Network. It is intended for informational purposes, and is not intended as a substitute for professional advice.