Have you ever gone to the grocery store, filled your shopping cart with delicious items, and then decided to just…walk away? How about scanning items in the checkout line only to say “no” and just give up the whole business?
Of course, you didn’t.
Yet these two actions, cart abandonment and checkout abandonment, happen millions of times every day for online retailers around the world. According to a global study by Baymad, 69% of shoppers walk away from their cart. Of customers who stay at checkout, 41% will abandon their checkout.
It’s a ground wasted effort – and advertising dollars – going out.
Let’s take a look at how to measure and improve cart and checkout abandonment, or as I call it, “cartalytics”.
How to Measure Cart and Checkout Abandonment
Before you can improve dropout rates, start with some baseline data. Let’s define the two main metrics we’re looking to improve:
1. The cart abandonment the price is calculated using the formula: added to basket/(added to basket+purchases). It represents the percentage of customers who abandoned cart items out of all customers who added items to their carts.
For example, if 100 people added items to their cart but only 25 of them converted, the cart abandonment rate is: 100/(100+25)=0.8=80%. As a result, 80% of customers who added items to their carts abandoned them.
2. The checkout abandonment rate is similar and calculated with the formula: payment page started / (payment page started + purchases completed). It represents the percentage of customers who abandoned items in checkout out of all customers who added items to their cart.
Fortunately, Google Analytics includes this data for any advanced e-commerce setup. To get started, open the Conversions and Purchase Behavior section in Google Analytics. You should see a report for your customer’s onsite journey stages for the selected time period. When you view the chart from left to right, you should see how many visitors abandoned at different stages of the customer journey.
Both of these measurements are essential for recording over time. As you implement drop-recover strategies, keep an eye on changes to this view over time (at least twice a month).
How to Improve Cart and Checkout Abandonment
The first thing to keep in mind is that no one accidentally lands on your website – and everyone lands with it. some level of purchase intention. When looking at the two abandonment rates, follow these three rules: engage the customer, keep it simple (and fast!), and don’t sell past the close.
Much of cart abandonment is due to window shopping. These customers use the shopping cart to store “future purchase intent”. A good way to measure this is to look at cart abandonment rates for returning users. Often, a higher rate for this customer segment indicates browsing and a lack of immediacy in the buying process.
Combating this behavior is difficult, but another method is to engage the customer and help convert “in active carts” into active wishlists.
For example, when a customer is about to leave the site, a simple pop-up offering to save their cart if they enter their email address gives you the option to re-engage later. With an email in hand, you can use traditional re-engagement methods that introduce time-induced FOMO messages (e.g. items sell out fast or sale ends tomorrow).
In short, embrace navigation and keep the customer coming back later.
Simple friction is a second major source of shopping cart abandonment. When a customer has added an item to the cart, the payment path should be as short as possible. Amazon excels at this with its simple one-click buy it now button, but retailers can use other, even simpler methods.
For mobile customers on iOS (a category of devices where retargeting is complex), the Apple Pay system offers a fast checkout experience. In the example below from an online retailer, the Apple Pay button helps users navigate past the shopping cart and straight to checkout without any friction.
Friction can also be introduced by trying to “oversell” the cart. Adding upsells and introducing too many tracking events on cart actions can have a huge impact on page speed.
Site speed continues to be a leading cause of declining conversion rates, with slower sites experiencing dramatic reductions in conversions, average order value, and even brand loyalty.
A recent Radware study found that one in five customers will abandon shopping carts solely due to slow site performance.
In short, the best cart is often the one the user ignores entirely, ensuring a fast and frictionless experience.
Cancellation of payment
When it comes to payment, the experience should be surprise-free, frictionless, and most importantly, fast.
Let’s face it, nobody likes surprises when it comes to unexpected costs. Be upfront with your customer and give them all the information they need before checking out. For example, providing shipping costs earlier in the journey is one way to increase transparency. If you don’t, they’ll feel scammed or cheated and might turn to your competitors for a better deal.
Along the same lines, assessing when shipping costs can be eliminated is now a key part of a successful checkout. The ideal consumer cost is $0 (thanks Amazon!), but most customers are willing to invest in more products to qualify for free shipping. In fact, 90% of customers said they would take big steps to qualify for free shipping, including 58% who said they would add more items to their cart in order to qualify.
Retailers often see the checkout process as an opportunity to sell additional products, and that has some merit, but in moderation. When a customer checks out, take a moment to analyze whether introducing additional products is right for that customer.
For customers who have a single item in their cart and a short session duration, especially on mobile, keep it simple and fast. In comparison, customers who arrive at checkout with more complex carts and who have shown a longer engagement time are more open to upsell opportunities, especially if they unlock cost reductions like free shipping.
But the key aspect of payment is to keep the whole process as simple as possible. According to a study by the Baymard Institute, the average payment flow has 5.08 steps. Aim for a checkout flow well below 5 steps and you will stand out from your competitors.
You are now well equipped to better understand cart and checkout abandonment, how to measure it – and most importantly, and how you can improve your online store’s checkout experience as a whole.