Shopping Cart Abandonment Rate

Shopping Cart Abandonment Rate: Introduction 

Often, customers add products to an online shopping cart but move on without purchasing them. In other words, they abandon their carts without finishing check-out. They thus contribute to the shopping cart abandonment rate of an eCommerce business.

What is the shopping cart abandonment rate and why is it important? How to calculate the cart abandonment rate and what are some ways to reduce it? Find out in this article.

What is Shopping Cart Abandonment Rate? 

Shopping cart abandonment rate, also known as checkout abandonment rate, is a metric that measures the percentage of online shoppers who add items to their shopping cart but then leave the website without completing the purchase.

Ecommerce businesses generally do encounter abandoned carts. There are always customers who view products, like them, and add them to their shopping carts – only to give up without completing the transaction for various reasons.

However, it becomes a cause for concern when the shopping cart abandonment rate exceeds a certain value or keeps increasing. In such cases, the metric becomes an indication of underlying problems that an eCommerce business may want to resolve sooner rather than later.

As the abandonment cart rate increases, the loss of sales revenue for eCommerce businesses also increases, which is why it is an important KPI (Key Performance Indicator) to track.

How to Calculate Shopping Cart Abandonment Rate 

To calculate the shopping cart abandonment rate, divide the number of completed purchases by the total number of shopping carts created in a given period. Then subtract this value from 1 and multiply the result by 100 to express it as a percentage.

Shopping cart abandonment rate = 1 – (number of completed purchases / total number of shopping carts created)*100

For example, consider that an online store had 1,000 shopping carts created in a given time period. Out of these, 300 carts were completed purchases. The shopping cart abandonment rate would be calculated as (1 - 300/1000) x 100%. In this case, the rate is 70%.

The average shopping cart abandonment rate lies between 68-74%. A rate larger than this is considered a high cart abandonment rate.

How to Decrease the Shopping Cart Abandonment Rate 

There are many strategies through which eCommerce stores can bring down their shopping cart abandonment rate. They span several ends of the business operations, from marketing to payment to customer support. Some of these include:

1. Provide guest checkout: Forcing shoppers to create an account for a purchase may push them away, leading them to abandon their carts. Offering guest checkout is a practical way to ease the process of purchasing. Customers who do not want to sign up or register their personal details can take this route and complete the transaction.
2. Offer multiple payment options: Providing limited payment options prevents customers from completing their purchases. Thus, eCommerce stores should offer several different payment methods, alongside helpful features such as the option to save billing details. Stores may research the payment options their target customer base prefers and make sure to integrate them into their online store.
3. Ensure cost transparency: Do not spring hidden or additional costs over customers at the last step of the checkout process. When that happens, customers are pushed to quit shopping and abandon their carts. Ecommerce stores must ensure all costs are transparently shown to customers clearly on the page, with breakdown where needed. When shipping costs apply, consider providing an estimate before the customers enter their billing information.
4. Smooth website navigation: Make sure your store website is smooth and user-friendly. Allow customers to navigate easily between different steps of the purchase process. This covers steps such as adding items to cart, providing payment and billing details, product pricing breakdown, and the payment process. Do not overcomplicate the matter, keep the flow between different steps effortless, and add helpful navigation buttons so that customers are not frustrated into abandoning their carts.
5. Offer free shipping: Attract more customers by providing free shipping. Where there is a shipping fee involved, customers are prompted to reconsider their decision. However, free shipping motivates them to proceed and buy items in one go, as they feel that they save money on a purchase. This is also important as a growing number of online shoppers today expect stores to offer free shipping.
6. Friendly refund and returns: Make sure to offer a feasible but also customer-friendly return and refund option. This allows customers to develop trust in the brands that they are buying from. They feel at ease making purchases, since they know that they can avail themselves of the return and refund option without too many hassles. This encourages them to proceed and finish the purchase.
7. Robust customer support: Customers may have many questions when considering a product and trying to purchase it. Make sure your website offers them the support that they need during this process. This includes keeping a helpful and updated FAQ page, where stores provide answers to the most frequently arising questions. Another possible way is to integrate live chat support, where customers can get responses immediately, and do not abandon their carts due to doubts.

Key Takeaways 

• The shopping cart abandonment rate refers to the percentage of customers who, although add products to their carts online, end up terminating the buying process without checking out.
• Shopping cart abandonment rate can be calculated by first dividing the number of completed purchases by the total number of shopping carts created in a given period, then subtracting this value from 1, and multiplying the outcome by 100 to express it as a percentage.
• Several things may push customers to abandon their shopping carts, such as hidden costs, clunky websites, lack of diverse payment options, and poor customer support.
• Businesses can decrease the shopping cart abandonment rate in several ways. These include providing guest checkout, multiple payment methods, free shipping, friendly return and refund policy, and responsive customer support.