Shopping cart abandonment

Shopping cart abandonment is a term used to describe the situation when a consumer adds items to their online shopping cart, but fails to complete the purchase. Shopping cart abandonment is a major issue for online retailers as it translates to lost sales and decreased revenue. It is a complex problem that can be caused by a variety of factors, including complicated checkout processes, lack of payment options, hidden costs, slow delivery times, and overall poor user experience. To help manage shopping cart abandonment, retailers need to focus on providing an efficient and enjoyable checkout experience, as well as offering a variety of payment options and transparent pricing.

Example of shopping cart abandonment

• A customer may add items to their online shopping cart, but then abandon the cart when they are presented with a complicated checkout process.
• Another example of shopping cart abandonment is when a customer is not given a variety of payment options and only sees expensive delivery charges after adding items to their cart.
• Shopping cart abandonment may also occur when customers are not given an accurate delivery estimate, or when their desired delivery date is not available.
• Finally, a customer may abandon their cart if the overall user experience is not enjoyable or if they are presented with unexpected costs, such as taxes and fees.

Formula of shopping cart abandonment

Shopping Cart Abandonment (SCA) is calculated using the following formula:

SCA = (Total Visitors – Checkouts)/Total Visitors

This formula takes into account the total number of visitors on a website and subtracts the number of successful checkouts from that total. The remaining number represents the total shopping cart abandonment rate.

The formula can also be expressed in terms of another metric, average order value (AOV):

SCA = (Total AOV – Checkouts AOV)/Total AOV

This formula uses the total AOV of the website and subtracts the AOV of successful checkouts. The remaining AOV represents the total shopping cart abandonment rate.

By using these formulas, retailers can gain a better understanding of the shopping cart abandonment rate and identify areas where it is highest. This data can then be used to optimize the checkout process and improve customer experience, which can help reduce the shopping cart abandonment rate.

When to use shopping cart abandonment

Shopping cart abandonment should be used when retailers wish to improve customer experience, reduce customer frustration, and increase sales. To do so, retailers should focus on providing a streamlined checkout process, a variety of payment options, transparent pricing, and reliable delivery times. Specifically, retailers should:

• Streamline the checkout process by reducing the number of steps and removing any unnecessary fields or information.
• Offer a variety of payment options to allow customers to make the payment method that suits them best.
• Clearly display pricing at each stage of the checkout process, including taxes and shipping costs.
• Set realistic delivery expectations and provide reliable delivery times.

By addressing the factors that contribute to shopping cart abandonment, retailers can reduce frustration and increase customer satisfaction while also increasing their sales.

Types of shopping cart abandonment

Shopping cart abandonment is a major problem for online retailers and is caused by a range of issues. There are several types of shopping cart abandonment, including:

• Impulse Abandonment: This occurs when a customer adds items to their online shopping cart with the intention of buying, but then changes their mind and does not complete the purchase.
• Complicated Checkout: This occurs when a customer finds the checkout process to be too complicated or lengthy, and abandons the cart before completing their purchase.
• Hidden Costs: This occurs when a customer is surprised by additional costs that were not visible at the time of adding items to the cart.
• Payment Issues: This occurs when a customer is unable to complete their purchase due to payment issues, such as lack of payment options or payment security concerns.
• Delivery Times: This occurs when a customer is dissatisfied with the delivery times or shipping costs, and abandons the cart as a result.
• Poor User Experience: This occurs when a customer has a negative experience with the website, such as slow loading times or confusing navigation, and abandons their cart as a result.

Steps of shopping cart abandonment

Shopping cart abandonment is a major issue for online retailers as it translates to lost sales and decreased revenue. To help manage shopping cart abandonment, retailers should take the following steps:

• First, retailers should focus on providing an efficient and enjoyable checkout experience. This includes streamlining the checkout process, making sure the website is easy to navigate, and providing customers with helpful information about the purchase.
• Second, retailers should offer a variety of payment options. This can include credit and debit cards, PayPal, Apple Pay, and other forms of digital wallets.
• Third, retailers should make sure that pricing is transparent and clearly stated on the website. This includes any additional fees or taxes that may be associated with the purchase.
• Fourth, retailers should provide customers with accurate information about delivery times and returns policies. This will help customers to make an informed decision about their purchase.
• Finally, retailers should ensure that their website is secure and that their customers’ personal data is protected. This will help to build trust and ensure that customers feel secure when making their purchase.

Advantages of shopping cart abandonment

Shopping cart abandonment can have some advantages for online retailers. These include:

• Increased understanding of customer behaviour - Tracking shopping cart abandonment provides retailers with insight into customer behaviour, allowing them to identify areas for improvement, such as user experience, payment options, and pricing.
• Improved customer service - By understanding abandonment rates, retailers can better serve their customers by providing more efficient and enjoyable checkout experiences.
• Cost savings - By tracking and addressing shopping cart abandonment, retailers can save money on marketing costs and lost sales.
• Increased engagement - Tracking shopping cart abandonment can also help retailers engage with customers who have abandoned their carts, offering them incentives and discounts to complete their purchase.

Effects of shopping cart abandonment

Shopping cart abandonment can have serious consequences for online retailers, and there are a number of limitations associated with it. These include:

• Loss of revenue: Shopping cart abandonment results in lost revenue for retailers, as consumers fail to complete their purchases.
• Diminished trust: Shopping cart abandonment can lead to a decrease in customer trust and loyalty, as customers may feel that their personal information is not secure.
• Lack of customer feedback: Unfinished purchases mean that retailers may not receive feedback from customers on their checkout experience, preventing them from gathering valuable insights.
• Customer frustration: Poor checkout experiences can lead to customer frustration, causing them to abandon their carts and shop elsewhere.
• Increased risk: Shopping cart abandonment can lead to increased chargeback and fraud risk for retailers, as customers may be more likely to dispute their purchases.
• Competitive disadvantage: Without an efficient checkout process, retailers may be at a competitive disadvantage, as customers may be more likely to shop with other retailers with better experiences.

Shopping cart abandonment — recommended articles

Handling of customer complaint — Customer value creation — Advertising elasticity of demand — Abandonment rate — Delay in payment — Pareto analysis — Price setting — Trade allowance — Exceed customer expectations

References

• Kukar-Kinney, M., & Close, A. G. (2010). The determinants of consumers’ online shopping cart abandonment. Journal of the Academy of Marketing Science, 38, 240-250.
• Egeln, L. S., & Joseph, J. A. (2012). Shopping cart abandonment in online shopping. Atlantic Marketing Journal, 1(1), 1.
• Huang, G. H., Korfiatis, N., & Chang, C. T. (2018). Mobile shopping cart abandonment: The roles of conflicts, ambivalence, and hesitation. Journal of Business Research, 85, 165-174.