Cart abandonment rate, also known as shopping cart abandonment rate, refers to the percentage of online shoppers who add items to their virtual shopping cart but leave the website before completing the purchase.
In simpler terms, it’s the rate at which customers abandon their online shopping carts without finalizing the checkout process.
Here’s a breakdown of cart abandonment rate:
- Calculation: It’s typically calculated by dividing the number of completed transactions by the number of shopping carts initiated (items added), then subtracting the result from one and multiplying by 100.
- Average Rate: Studies show the average cart abandonment rate hovers around 70%, meaning for every 10 customers who add items to their cart, roughly 7 will leave without buying.
- Impact: A high cart abandonment rate can represent significant lost revenue for e-commerce businesses.
Here are some of the common reasons why customers abandon their carts:
- Unexpected costs: Hidden fees, high shipping costs, or taxes added at checkout can surprise customers and lead them to abandon their cart.
- Complex checkout process: A lengthy or confusing checkout process with too many steps can discourage customers from completing the purchase.
- Limited payment options: Not offering preferred payment methods can be a barrier for some customers.
- Account creation requirement: Forcing customers to create an account before checkout can be an inconvenience and deter purchases.
- Price comparison and browsing: Sometimes, adding items to the cart might just be for comparison or browsing purposes, and not a definite purchase intent.
By understanding cart abandonment rate and the reasons behind it, e-commerce businesses can implement strategies to reduce it. This can involve streamlining the checkout process, offering guest checkout options, providing transparent pricing, and implementing targeted cart abandonment recovery tactics like reminder emails.
