It’s a great day - your online store is attracting traffic, everything seems smooth and there isn’t a cloud in the sky.
Until Google Analytics reveals a problem.
Your traffic is up, but your sales aren’t, and your funnel shows a clear drop-off point: your cart.
Your shopping cart abandonment rate is much higher than you’d like.
What gives? Why are customers so close to the finish line but never crossing it?
We’ll explain why this happens and how you can reduce your cart abandonment to as close to 0% as possible. Hopefully, you’ll get a few ideas on how to turn your window shoppers into paying customers.
Here’s what we’ll cover:
- What is cart abandonment and why it’s important
- What are the reasons for shopping cart abandonment
- How does cart abandonment impact businesses
- What are the strategies to reduce online cart abandonment
- How to measure and analyze abandonment rates
- What does the future hold
And this is why you need to know more about shopping cart abandonment:
Source: Statista, showcasing online shopping cart abandonment rate worldwide from 2006 to 2024
It’s an e-commerce epidemic, and you can’t just keep coasting.
Understanding shopping cart abandonment
We can’t solve a problem we don’t understand.
So, before we get into the nitty-gritty, check this quick overview of what an abandoned cart means, why a customer decides to abandon a cart, and how that impacts a business.
Definition of shopping cart abandonment
Shopping cart abandonment happens when a customer adds items to their cart but leaves the site without completing the purchase. Your customer essentially ghosts you.
To calculate the abandonment rate, divide completed purchases by the total carts created, subtract the result from one, and then multiply by 100.
For example, if 500 carts are created on your site, but only 150 purchases were completed, you get:
150/500 = 0.30
1 - 0.30 = 0.70
0.70 x 100 = 70%
This means 70% of your customers leave without buying. This number might seem high, but according to Statista, it aligns with the 2024 global average abandonment rate of 70.19%, which has steadily increased over the past two decades.
But we need to differentiate between two types of abandonment to find the reasons for it:
- Browsing abandonment: Customers add items while casually exploring, without serious intent to purchase. This is often a part of the research phase when users are comparing prices.
- Intentional abandonment: Customers add items to the cart with a purchase intention but leave due to various issues plaguing the website or checkout process.
The latter is generally more serious because it indicates that a customer was interested in making a purchase but encountered obstacles. These obstacles are yours to fix.
The customer journey
You can’t (and shouldn’t) address shopping cart abandonment if you don’t know your customer journey.
Here’s a refresher - the customer journey is the complete experience your customers have with your brand from the first point of contact to post-purchase interactions.
You can group it in various stages depending on the business and its marketing activities and use it to understand customer behavior, pain points, and decision-making.
A rough customer journey may encompass the following stages:
- Awareness
- Consideration
- Decision
- Purchase
- Post-purchase
- Loyalty
If you haven’t yet created a customer journey map, here’s an example of what it can look like (but it can vary significantly depending on the needs of the business):
Source: Digital Insights
Online shopping cart abandonment often happens during the decision and purchase stage, where customers have chosen a product but face issues that stop the sale.
What could that be?
13+ common reasons for cart abandonment
Cart abandonment is a common problem. It’s so common in fact, that many studies research the reasons why consumers leave during checkout.
Novice marketers may immediately blame a buggy checkout page, but that’s not even scratching the surface.
Here are some of the reasons consumers ghost you at checkout:
- Slow website performance or technical issues.
- Unexpected costs (e.g., shipping fees, taxes).
- Complicated or lengthy checkout process.
- Prices are displayed in foreign currencies.
- Inability to see the total costs upfront.
- Mandatory account creation.
- Lack of trust in site security.
- Unsatisfactory return policy.
- Limited payment options.
- Limited shipping options.
- Slow expected delivery.
- Declined credit card.
- Too much upselling.
And here’s the percentage breakdown of the main reasons for cart abandonment:
Source: Statista
Looks like it might not be a buggy page after all.
When it comes to one of these reasons - a site that shows incorrect currencies - we’re currently working on adding geo currencies to our suite of features at Geo Targetly.
By using the platform, your site will automatically show the correct currency based on the visitor’s location, so that’s one less thing you have to worry about.
The impact on e-commerce businesses
Digital shopping cart abandonment isn’t just a headache for e-commerce and marketing managers or a random metric to track - it has a tangible impact on a business.
Some of the most pressing issues it can cause include:
Financial implications
Abandoned carts are missed sales that drain your budget. They can trigger a financial ripple effect.
For example, some e-commerce platforms remove the carted item from the inventory and reserve it for the current shopper. If that shopper abandons the product, another user can’t purchase it. So, you’re losing out on two potential sales simultaneously.
Besides this, a higher cart abandonment rate increases customer acquisition costs. When you spend on ads to attract visitors to your site who don’t complete purchases, your costs rise without yielding returns, inflating your CAC.
Other financial implications may include:
- Reduced ROI on marketing spend
- Increased marketing and retargeting costs
- Lower profit margins (after enticing lost customers with discounts)
Brand perception
Whenever customers encounter friction on your site, their perception of your brand suffers.
While not every issue drives customers away, the ones who leave may spread negative word of mouth (e-WOM). If you work (or have worked) in marketing, you’ll know that negative reviews can quickly kill your brand.
Consumers are more likely to share negative reviews than positive ones, so it would only be a matter of time before your business is drowning in criticism.
Customers frustrated by your checkout process or who find your site untrustworthy can deter future buyers. In turn, you’ll have a lower customer lifetime value (LTV), fewer repeat purchases, and little to no customer loyalty.
Analytics and metrics
To keep your finger on the pulse, you need to track the metrics that matter - and abandoned cart rate is one of them.
In e-commerce, this directly affects revenue and conversion rates. But you won’t be able to make the connection if you don’t familiarize yourself with your analytics.
Metric reveal customer behavior and the reasons behind online shopping cart abandonment. This insight will help you take the appropriate steps to optimize your sales funnel, understand how you can recapture lost revenue, and explore new marketing opportunities.
According to Baymard Research, the average large-sized e-commerce site can increase its conversion rate by a staggering 35.26% with better checkout design. This translates to $260 billion worth of recoverable orders.
Now, think about how much money you’re missing out on with an abandoned cart rate of 60%.
Strategies to reduce shopping cart abandonment
Now, let’s talk solutions - how can you reduce your shopping cart abandonment without overhauling your entire site?
Streamline the checkout process
Statistics reveal that customers abandon their carts when faced with complex, time-consuming procedures. For some websites, the most time-consuming process is the checkout itself.
When websites require customers to jump through hoops to create accounts, verify their accounts, and fill out numerous details just to buy something, the effort feels unwarranted. It’s similar to a cashier hounding you for your address at the register - you’d likely leave the store, too.
So, marketers should always prioritize simplicity.
For example, reduce the form fields before checkout. Keep your forms to essential information, like their email and name.
Besides this, offer guest checkout options instead of forcing account creation, which creates unnecessary obstacles and hinders a quick checkout.
Enhance transparency
Another major reason customers abandon carts is unexpected costs like shipping fees or taxes that only appear during the final checkout. When buyers realize they’ll pay significantly more than expected, they’ll leave (and feel deceived).
To combat this, display all costs upfront. The best way to prevent “sticker shock” is to make the shopping experience trustworthy. Show estimated shipping fees on the product page and don’t conceal any information until checkout.
Additionally, have clear and strong return and refund policies to build customer confidence. When customers know they can easily return an item if it doesn’t meet their expectations, they’re more likely to complete their purchase, as the perceived risk decreases.
Your return policies should always be transparent enough to alleviate concerns about product dissatisfaction.
Build trust
Many customers leave websites during checkout due to a lack of trust in website security.
Online shopping can feel risky, especially for high-value items. But while you can’t just add a pop-up telling your users you’re legit, you need to show them.
Demonstrate legitimacy by displaying security badges and SSL certificates on your checkout pages. These reassure users their personal and payment information is encrypted and secure.
Another way to build trust is by showing testimonials and reviews near the cart or checkout page. Social proof is crucial in e-commerce, and people are still more likely to trust other buyers than brands.
If you’re running a new business that still hasn’t gathered testimonials - do not fabricate them. Instead, focus on providing value to existing customers and ask them for genuine feedback when appropriate.
Or, you can also use platforms like GeoTargetly to optimize your campaigns with location-based marketing, an affordable and quick way to hitch your wagon to the latest trends.
Improve website performance
Customers expect a fast and seamless online shopping experience. Slow loading times are the exact opposite of what you should give them.
Google and SOASTA reported that for every second delay in mobile page load, conversions fall by up to 20%. In just five seconds, you could lose all would-be customers. Therefore, a slow website is never a good idea, even if it means sacrificing some interactive elements.
Don’t overlook mobile responsiveness. Often, developers work and test on desktops, so mobile-friendliness is rarely a priority. This shouldn’t be the case - mobile responsiveness should be at the forefront of your (and your developer’s) mind.
According to Pew Research, 76% of Americans reported shopping online using a smartphone, meaning a poor mobile experience can drive away three-quarters of your customers. If there’s awkward navigation, slow load times, or hard-to-click buttons - your abandoned cart rate will keep going up.
Retarget and follow-up
Your relationship with your customers isn’t over if they leave your site. Even if they didn’t purchase this time, you should stay top-of-mind when they browse again.
A great way to do that is by sending personalized reminder emails to customers who abandoned their carts. According to a Klaviyo report, businesses that use this tactic earn back 3.33% of lost sales and drive the highest engagement across industries.
These emails serve as a nudge to remind people of the items left behind, so be sure to address the customer by name and reference specific items from their cart.
You can also include incentives like discounts and free shipping. For example, businesses can send an email offering a 10% discount if the customer completes the purchase within a certain timeframe, or let them know they can quality for free shipping by adding one more item.
Alternatively, display special offers directly in the cart (e.g., “Add one more item for a discount” or “You’re just $5 away from free shipping”). You may also opt for softer CTAs like “Continue” instead of “Buy” or “Checkout”.
Offer multiple payment options
Since you’re getting all kinds of people on your site, it’s logical to cater to as wide a group as possible, which includes payment options.
The more diverse the payment methods, the more likely customers are to complete their purchase, as you’ve already covered all grounds.
Ensure your site accepts major credit cards, PayPal, Apple Pay, and other digital wallers.
Many shoppers have strong preferences, so when their preferred option is unavailable, they might not even consider buying. This tells you that you’re the one who needs to be flexible.
Add to the experience
Lastly, evaluate the entire shopping experience on your website from a customer's point of view.
An often overlooked idea, suggested by Reddit users experienced in e-commerce, is to incorporate FOMO (fear of missing out) experiences.
For example, you can display messages like “Two people are also looking at this item.” This creates a sense of urgency and encourages customers to follow through with their purchases. What’s more, it taps into social proof, which is already a significant driver of conversions.
The cherry on top should always be your customer support options. Offer various ways for customers to reach out for help, such as live chats, surveys, email addresses, and phone numbers so that users have support when encountering difficulties.
Measuring and analyzing abandonment
To know how to fix an issue, you must first understand it.
This rings true in our everyday lives, but it’s also crucial for the success of a business. Such is the case for cart abandonment, as well.
If you want to improve your rates, you need the data. Here’s how you can get it:
Tools and software
Most marketers don’t do manual calculations to analyze abandoned carts (thankfully). But this means we need to rely on various tools and software to track user behavior, identify drop-off points, and create targeted solutions for recovering lost sales.
Unfortunately, nothing is simple in the marketing universe and you won’t find one tool to get the job done from A to Z. So, you’ll need more tools that track different steps of your buyer’s journey that you then need to integrate.
Here are the most common analytics tools you can use to diagnose issues:
A/B testing
A/B testing is an effective method for measuring and reducing cart abandonment. It entails experimenting with aspects and elements of your site and comparing two versions to see which performs better in terms of conversions or other metrics.
These tests enable data-driven decisions that improve user experience and reduce friction in the customer journey.
A/B testing requires time, patience, and an existing hypothesis. You need to identify the issue beforehand along with the potential problem areas you want to test. Then, you can set clear goals against which you’ll determine the winner.
Check out some expert tips on effective A/B testing from our CMO, Kiril Bunin:
- Always test one variable at a time
- Run only one test at a time, especially for the same page
- Do a pilot test beforehand
- Determine what statistical reliability is significant (it should be at least 95%)
- Let the tests run for at least a week or two before deciding
- Test idea development with AI
- Define objectives before starting the test
- Ensure you have a statistically significant sample size to draw conclusions
- Monitor the performance while the tests are running to spot unexpected changes
- Don’t get demotivated by failed tests, learn from them
Future trends
So what does the future hold?
We’ve already looked to the past to examine some of the most common reasons for digital shopping cart abandonment and outlined a few methods to rectify it - what’s next?
Digital technology changes rapidly and we’re not Nostradamus, so we can’t predict the future (unfortunately, or we could’ve told you why your abandonment rate is high!). But let’s indulge in a little speculation and talk about what’s likely to happen:
Personalized shopping experiences
Now that we have highly detailed targeting options from our users, including feedback that they value personalization, it’s no surprise they’ll ask for a custom online shopping experience.
We expect that soon, our customers won’t be satisfied with “personalization” like seeing their name or getting product recommendations based on past purchases. They’ll demand deeper, more granular interactions that rest on precise data orchestration and an understanding of their thoughts and opinions before they’ve expressed them.
The future of personalization may include:
- Real-time product recommendations
- Convenient checkout innovations
- Intuitive experiences with AR/VR
- Use of AI and machine learning
- Custom fraud prevention
Or, maybe it will be something entirely different…
Advanced payment solutions
Besides personalization, brands will need to be much more cautious of the checkout experience to ensure it’s simple, fast, efficient, and mobile-first.
We say this not because of sheer opinion, but because mobile payments with digital wallets are expected to be the fastest-growing payment method globally, with a 61% estimated share of transaction value in e-commerce and stable, gradual growth in the last 5 years:
Source: Boku Mobile Wallets Report
Consequently, we look forward to seeing advancements like:
- Adoption of digital wallets and one-click payments
- Automatic recurring payments in subscription billing
- Cryptocurrency payments for a subset of consumers
- Biometric payments that utilize fingerprint and facial recognition.
Conclusion
So, let’s recap:
Shopping cart abandonment is when customers add items to their online cart but leave the site without completing the purchase.
Addressing abandoned carts before they’ve turned into a bigger problem should be on every business’ priority list, as it directly affects revenue and customer retention efforts.
But not everything is black and white.
By implementing and continuously upgrading strategies to remedy the situation, you can reduce your abandonment rates and improve sales performance.
The most important thing is for companies to stay proactive and not despair at the sight of a high rate. Instead, use it as the push to research and refine solutions to better meet customer expectations.
Additional resources
If you want to go deeper into the topic, we recommend the following studies on cart abandonment:
- Online shopping cart abandonment: a consumer mindset perspective
- The determinants of consumers’ shopping cart abandonment
- The roles of conflicts, ambivalence, and hesitation on mobile cart abandonment
- Understanding shopping cart abandonment by segmenting & profiling
- Electronic shopping cart abandonment: What do we know and where should we be heading?
And if you’re more into non-academic studies to get the latest scoop on e-commerce optimization, check out these resources:
- Shopify Blog
- BigCommerce Blog
- Wix Blog
- HubSpot Blog
- Neil Patel Blog
- The Ecommerce Playbook Podcast
- Brave Commerce Podcast
- Future Commerce Podcast
- Ecommerce Conversations Podcast
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