Posted by George Gabriel on 04 Jun, 2014
Is abandonment making basket cases out of online retailers?
Basket abandonment is consistently the burning issue for online retailers, costing up to a staggering $3 trillion a year in potential sales. Basket abandonment is when customers place items in their online shopping basket, only to close the page and not complete the transaction. Independent research has shown that in 2013, up to 68% of shoppers have admitted to basket abandonment, leaving retailers with the challenge of how to drive better conversion rates. With the on-going increase of consumers purchasing items online, we look at some of the reasons for basket abandonment, and what retailers are doing about it.
Important considerations for retailers affecting both mobile and desktop channels are the types of shoppers, and the behaviour they exhibit when browsing. Independent researchers Amaze have found there are three types of shoppers that contribute more to basket abandonment than most.Firstly, the Vague shopper, who seeks more information from other parties before making a decision, Cost conscious buyers tend to make their purchases on rational cost criteria. This type of buyer often abandons their baskets as a result of external costs such as postage, frequently looking for the cheapest alternative. Lastly, Window shoppers, who are often the worst offenders of basket abandonment as they have no real intention to buy, and are using their shopping baskets as a ‘wish list’.
Statistics show that basket abandonment is prominent amongst both desktop and mobile formats alike, with a Jumio consumer study from 2013 showing abandonment rates as high as 67% across both platforms. In an industry where convenience and cost is key, there are many different reasons as to why online transactions do not cross the finishing line.
1. Price comparison
Most consumers often visit online retailers to check prices and compare products across a variety of websites. Through either going to another website, or simply becoming distracted by surrounding events, basket abandonment is at its most prominent in this situation.
Follow up emails and SMS to remind customers that they have items remaining in their online baskets ready to be checked out is becoming increasingly effective tool for retailers. These emails can provide incentives such as ‘buy these items within the next 24 hours to claim a 10% discount’. MCommerce apps are also using push notification to offer a gentle reminder for customers to complete transactions.
2. Long order forms
Long, over complicated forms to fill out can often frustrate shoppers, resulting in a lack of motivation to complete the transaction before checking out, particularly on small screens.
To combat this issue, online retailers are simplifying forms to make them less daunting for customers. Also, some retailers allow first time customers to make transactions on a guest basis, removing the issue of customers not wanting to take the time to complete long registration forms. Payment initiatives such as PayPal are offering customers the opportunity to make transactions much quicker, prompting as little clicks and data input as possible for shoppers.
Apps such as Uber allow the input of credit card details via camera, allowing users to provide credit card details more conveniently.
3. Time it takes to ship
Shipping times can be too long and/or be unclear, which can drive consumers to abandon their basket and simply visit a store or another site for their item, rather than having to wait days and/or feel pressured to stay in their house waiting for a delivery that may or may not come on a certain expected date.
Experts claim that click and collect will continue to boom, with more than three-quarters of UK shoppers using it by 2017, making receiving items considerably easier for consumers. Companies such as NEXT, John Lewis, Sainsburys, PC World and many others offer this service. Also, the Amazon Prime service offers a fast and unlimited one-day service for eligible purchases for an annual fee of £80.00. Retailers such as Argos integrate with Shutl, a same day delivery service too, which is another example of what retailers are doing to shorten waiting times for customers between making an order and receiving their item.
4. Costly delivery
For ‘cost conscious’ shoppers, shipping and delivery can often carry unexpected and pricey expenses. Similar to the issue of delivery time, Click and collect is an obvious option for users who don’t want to pay delivery fees. To keep costs lower for customers, retailers are offering free delivery for orders over a certain amount, and even free delivery in for any items in certain cases.
5. Not being able to see the product in the flesh
Not knowing what items will be like when they arrive is an issue for buyers who abandon baskets, particularly when purchasing clothing. Retailers are now trying to make it easier for customer by using Improved imagery, and models in a range of body shapes and sizes to exhibit how the clothes would fit on a variety of body types.
6. Potential hassle of returning items
Complicated return policies can be off putting to consumers who eventually abandon baskets. So alternative return options such as returning items back to the store, instead of sending the item by mail is another way that retailers are making returning an item easier for customers. Many retailers offer a free returns policy for customers who are worried about any unexpected costs for sending items back now anyway, which also alleviates one of the stresses of returning goods. Popular and accessible parcel delivery services such as CollectPlus are often a good option for consumers for an easy method of returning items 7 days a week. The company also claim that 90% of people who live in the UK’s towns and cities are within a one mile of a CollectPlus store.
7. Cross platform functionality
As more and more users browse on mobile devices, there’s been an increased need for cross platform functionality when browsing online retailers. When leaving a desktop computer, customers would no longer be able to access their basket from their mobile device, thus losing their accumulated items.
Retailers are now adopting persistent baskets, which hold on to the contents of buyer’s basket until their next visit whether it be on desktop or mobile sites, ready for checkout. Of course, there are limitations to persistent baskets. The user must have a personal profile with their respective retailer to access their baskets across multiple platforms.
8. Poor connectivity on mobile devices
A frustration for mobile consumers is often poor network coverage at crucial moments, increasing the length of time it takes for pages to load, or even worse, time out. To counteract this problem, more and more retailers are offering apps with offline browsing, where the user experience is uninterrupted in a situation where connectivity or network coverage is poor.
Currently, while all of these methods discussed can either discourage, or rescue abandonment, it is crucial that retailers continue to chip away at the issue by really getting into the head of their customer base to understand their needs and pain points. Online shopping is all about how retailers can deliver quality of service, easy of use, and most vitally, a convenient way for their consumers to buy products.
Our thoughts echo Jumio CEO Daniel Mattes’s call for retailers to provide a more streamlined and simple checkout process. If retailers fail to provide faster checkout options, consider the behaviour patterns of the different types of user, and address the safety of credit card and account information, the level of basket abandonment will remain the same.
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