Checkout conversion rates are a key measure of ecommerce success. High conversion rates indicate that your brand is connecting well with your audience and giving them an excellent online shopping experience. On the other hand, high rates of cart abandonment can be a sign that your DTC needs some TLC.
Cart abandonment is a significant issue for ecommerce businesses because it directly impacts revenue and profitability, customer experience and overall business growth. When browsers don’t become buyers, it can leave you and your team wondering why shoppers are abandoning their carts and what you should be doing about it.
Before you can start to solve the problem, it’s important to understand the negative impacts of cart abandonment.
Why Cart Abandonment Hurts Brands
1. Loss of Revenue
One of the most immediate and tangible impacts of cart abandonment is the loss of potential sales. When customers abandon their shopping carts, they leave behind products that they were interested in purchasing. This directly translates to lost revenue for your business.
2. Increased Customer Acquisition Costs
Ecommerce businesses often invest heavily in marketing and advertising to attract visitors to their websites. When these visitors abandon their carts, the cost of acquiring them does not yield a return. This inefficiency increases the overall customer acquisition cost (CAC).
3. Negative Impact on Customer Lifetime Value (LTV)
Customer Lifetime Value (LTV) represents the total revenue a business expects from a single customer over their entire relationship. High cart abandonment rates can negatively affect LTV by reducing the likelihood of returning or repeat customer purchases.
4. Diminished Brand Trust and Loyalty
Repeated instances of cart abandonment may indicate underlying issues with the shopping experience, such as lack of transparency in pricing, complicated navigation or poor website performance. These factors erode customer trust and loyalty, leading to negative perceptions of your brand.
5. Wasted Marketing Opportunities
Abandoned carts represent missed opportunities to convert interested shoppers into paying customers. Effective strategies like retargeting and abandoned cart emails can help recapture some of this lost potential, but without addressing the root causes, these efforts may not be as successful.
If your business does not implement abandoned cart recovery strategies, you’re missing out on the chance to re-engage potential customers and encourage them to complete their purchases.
Success Story: KUIU
With domestic ecommerce success in hand, outdoor apparel brand KUIU
set its sights on global markets. Read how they were able to grow
while seeing a 6.5X increase on its marketing ROI.
Read the KUIU story.
6. Competitive Disadvantage
In the highly competitive ecommerce landscape, providing a seamless and transparent shopping experience is crucial for retaining your customers. High cart abandonment rates suggest that your brand may be falling short in these areas, giving competitors an edge.
If a competitor offers a more streamlined checkout process with localised payment options, customers may prefer to shop with them instead, leading to a loss in market share.
Why Shoppers Abandon their Carts (and What You Can Do About It)
Unexpected Costs
Unexpected costs are the leading cause of cart abandonment, because they can create a feeling of distrust and frustration among customers just when they’re about to finalise their purchase.
- Extra Fees or Shipping Costs – Customers often abandon carts when confronted with unexpected extra fees, such as high shipping costs. You should include shipping and delivery fees throughout the purchase journey – from the product page to checkout.
- Duties and Taxes – Similarly, unexpected taxes can discourage customers from completing their purchase. Displaying estimated taxes upfront helps in managing customer expectations and reducing abandonment rates. This is especially important when your brand is selling to shoppers outside your home market.
Checkout Complications
A complex or frustrating checkout process can significantly contribute to cart abandonment. Simplifying and streamlining this process is essential.
- The checkout process is too long – A lengthy and complicated checkout process will deter customers. Aim to minimise the number of steps required to complete a purchase by enabling features like guest checkout.
- The shopper is forced to create an account – Requiring customers to create an account before purchasing can lead to cart abandonment. You can offer a guest checkout option to help retain those who prefer a quicker, hassle-free transaction.
- Technical Issues – Technical glitches such as slow loading times, session timeouts or errors during checkout can frustrate customers and cause them to abandon their carts. Regularly testing and optimising your site can alleviate these issues.
- Lack of local currency and payment options – Customers are more likely to complete purchases if prices are displayed in their local currency. Unexpected currency conversions can deter buyers. Different countries have preferred payment methods. Offering a variety of payment options tailored to local preferences can reduce cart abandonment.
Poor User Experience
A seamless and pleasant user experience is crucial for encouraging customers to complete their purchases. If customers find it challenging to navigate your site or locate products, they may abandon their carts out of frustration. Simplified and intuitive navigation can enhance the shopping experience.
Offering website content, customer service and checkout processes in the local language can enhance the user experience and reduce cart abandonment.
- Lack of Mobile Optimisation – With a growing number of shoppers using mobile devices, a lack of mobile optimisation can lead to cart abandonment. Ensure your site is mobile-friendly and responsive.
- Slow Website Speed – Slow loading times and technical issues can frustrate international customers. Investing in global CDN (Content Delivery Network) solutions can improve site performance across regions.
Conclusion
High cart abandonment rates don’t have to keep you up at night. You can win and retain global shoppers and achieve profitable growth. Copy-pasting your brand’s domestic checkout with all of the same payment methods, currencies, languages, checkout flows and other components into your international checkout is sure to increase cart abandonment.
Instead, you’ll want to localise the checkout experience and tailor it to each market. Give your shoppers the experience they expect with no surprises, and you’ll lower your abandoned cart rate and be well on your way to long-term, profitability around the world.
