One Sunday afternoon, back when I was in highschool, my dad took me to Costco. We spent hours walking the aisles and filling the cart to the brim with my favourite snacks, meals, books, and toys. You see for me, a trip to Costco meant the promise of many great weeks to come, but this Sunday was a little different.
When we got to the checkout there was only one line open and my dad wasn’t too happy about it. We waited as the cashier slowly worked through the bloated carts one by one, my dad getting visibly more agitated with each passing minute. Eventually, he turned to me and asked “is there anything we really need in here?”. Without really thinking, I looked over at the cart and shrugged, “I guess not”, I replied, and just like that we were walking out of the store leaving our cart abandoned there in the checkout aisle.
I was shocked. People don’t fill up shopping carts just to abandon them do they? Well, as my dad taught me on that fateful Sunday, sometimes they do and now that ecommerce is more popular than ever “sometimes” has become a lot more frequent. Experts like Salescyle put cart abandonment at an average of 75.6% across all sectors, with industries like travel ranging as high as 81.2%. These statistics paint a pretty clear picture: ecommerce has a huge cart abandonment problem and to be able to solve it, merchants first have to understand it.
Why Do Customers Abandon Their Shopping Carts?
Cart abandonment is a complex issue, not all carts are abandoned in the same way or for the same reasons. Understanding what leads different customers to bail out on a purchase is the first step to fixing the gaps in your user flow and converting more of your site visitors to happy purchasers. So, here are the top 4 reasons customers are abandoning their shopping carts.
1) The Customer is Surprised by Shipping Costs or Other Fees
Have you ever spent time humming and hawing over a purchase? Trying desperately to tell yourself that the benefits outweigh the costs and that at the end of the day it’ll be worth it? What if when you finally convinced yourself to pull the trigger you were met with a few extra surprise costs just before you clicked order. These fees would at least make you stop and second guess yourself if not abandon the purchase completely. If you’ve got surprise costs lurking in your purchase flow, this is exactly what’s happening to your customers.
Extra charges like shipping, handling, duty fees and even taxes can throw a customer's mental value calculations out of whack and cause them to drop out of your sales funnel in a hurry. A lot of brands think that putting these costs up front might scare customers off immediately but hiding them until the last click can stop a sure purchase in its tracks and leave a customer feeling ambushed or deceived.
With a rewards program you can go one step further and actually reverse the demotivating effect of surprise costs by allowing your loyal customers to redeem points at checkout. Now instead of being shocked at how expensive a purchase is becoming, they can be pleasantly surprised by a discount! Your customers will be flying through your checkout process (and taking their full shopping carts along for the ride).
2) The Checkout Process is Too Complicated or Requires Account Creation
Ecommerce is often heralded as the easier, faster, and all around better alternative to the hassle of an in-store experience but it doesn’t always live up to the hype. For every brand like Amazon that streamlines the customer experience with one-click ordering there are many still making their customers jump through hoops just to make a purchase.
The purchase process often involves providing your first/last/middle names, your shipping address, your billing address, your email address, your telephone number, your postal code, your city, and your country. Lord help you if you have to create a store account, you’d better get ready to pick a username, a password - no a more secure password, your mother’s maiden name, the name of your childhood pet… give up yet?
Well even if you haven’t, your customers might have. A long or complicated checkout/account creation process is one of the top causes for customers abandoning their shopping carts, and for good reason too! A difficult online checkout leaves a customer wishing they could just drive to the store, pay for a product and move on with their day.
This doesn’t have to be the case though, once again a rewards program can come to the rescue and help move your customers through the purchase process with welcome points. These are points you give a customer for creating an account with your store. They’re the friendly introduction that helps start a customer relationship on the right foot. Instead of being frustrated by an account creation process, your customers can actually get excited about it because they get something out of it too! You’ll end up converting more purchases and your customers will be one step closer to redeeming their first reward, it’s a win-win!
3) The Estimated Delivery Times are Too Long
Impulse purchases have been ruining monthly budgets for as long as commerce has been around - some customers just can’t help themselves. The rationale of an impulse buy is quite understandable if not downright relatable. You’re browsing the web or walking through a mall and you see something that catches your eye. Maybe you make the mistake of actually touching the product in the store or open up a new tab on the website and all of a sudden you realize you’re in too deep. You’re already picturing yourself using the product and enjoying its benefits and you know you just have to have it now.
The operative word in that sentence is now. Impulse purchases are built on a sense of immediacy - an impulse. You see something you like and you’re so excited you have to have it right then and there. However, with just a few simple words, this excitement can come crashing down in a hurry - “estimated delivery time”.
Sometimes, not being able to get the product soon leads to not wanting to get it at all. To an excited customer, getting a product by the end of the week and getting it by the end of the month can make a world of difference. In fact, Amazon’s Prime subscription service is built on this truth. Patience might be a virtue but for most customers it’s not going to stop them from abandoning their shopping carts.
By providing your customers with free shipping rewards as a part of your rewards program, you can sweeten the deal of waiting for their product. By still giving them a nice reward to enjoy in the moment, they may not mind so much that they have to wait for their products. They’ll experience the satisfaction that comes from redeeming an earned reward and they’ll feel better about the estimated wait because now it’s free!
4) The Customer Experiences Payment/Technical Issues
The reasons for cart abandonment we’ve discussed so far are unique challenges presented by the dawn of the ecommerce age, but tech hiccups can happen almost as easily in a store as they do online. These issues can take many shapes, from insufficient funds on a debit card to a declined credit card to tech/network troubles that stop a store or site from processing a payment.
The road from technical issues to an abandoned cart is a pretty straight one. If a customer can’t pay, then they can’t purchase. There’s only so many times a customer is going to refresh the page or re-enter their information before they realize their payment just isn’t going through and they leave the site.
While a rewards program can’t help you fix technical issues on the rest of your site, you’ll want to make sure it doesn’t cause any of its own. Smile.io rewards programs (to pick a completely random example) are built to withstand extremely high traffic volumes with remarkable stability, processing over 9,500 requests per minute on Black Friday last year. If you’re using a rewards program to patch up gaps in your purchase flow make sure you’re using one that doesn’t create any new gaps of its own.
A Rewards Program Won't Leave You (or Your Carts) Abandoned
Whether it’s surprise costs or a confusing checkout process, customers may stop purchases for any one of a number of reasons. Now that you understand the big four, you can get to work on helping these customers pick up where they left off and a rewards program just might be your biggest asset.
A rewards program can turn surprise costs into surprise discounts that will send customers straight through to the order confirmation page and (if you pick the right provider) won’t give you technical issues on even the busiest days of the year. Rewards programs can also smooth out account creation by giving customers welcome points to look forward to and can help put the “pulse” back in your impulse shoppers with the immediate gratification of a free shipping reward. So even if your customers try to abandon your brand, your rewards program never will.