When Good Shopping Carts Go Bad

It’s no surprise that shopping online is different than buying in ‘the real world’.  The differences are endless and the simplest distinction is in the outcome— the conversion rate.

Many reports put the average online conversion rate at 2%-3% percent and the cart abandonment rate above 60%.*  Imagine your local supermarket with half full carts scattered throughout the store, people asking each other for product reviews and opinions, hunting for coupons during checkout. Yikes! But that is today’s self-created online reality.

Online channels have historically developed their own set of rules (When was the last time the supermarket asked you to add an item to your cart before you could see the price?) which could be fostering abandonment.  On the upside, these online merchants have options; when people leave items in the cart online there are ways to follow-up in hopes of getting customers to convert.

In the supermarket, if you removed an item at the last minute, or walked away from your cart, you don't expect the cashier to chase you down in the parking lot offering you 10% off if you buy within the next 30 minutes.

Enter the world of abandoned cart remarketing

In the example above, website analytics married to email creates a profitable remarketing opportunity for savvy merchants.  A Google search on “Abandoned Cart Remarketing” will return results featuring  best practices from all the top-tier Email service providers.  I recently sat through an informative workshop outlining the steps to scrape shopping cart data from your web analytics tool, drop in a template, add your incentive code and deliver it to the customer only minutes after they left your site.

The deeper you align your marketing efforts to your individual customer’s behavior, the better your results.  Rich insight leads to campaign modifications that can counter negative behavior and minimize the ‘Pavlovian’ traps that cause shoppers to abandon.

But what happens when Good Carts Go Bad?  

Unlike the Rotisserie infomercial, it’s not “Set it and Forget it”.

Understanding WHY the customer abandoned is critical for honing in on what the best remarketing efforts would be and which could be counterproductive.

"Do you know what percentage of your abandonment is due to buying behavior and what percentage to transaction failure?"

What about the customers who WANT to purchase but your site fails them?

Let’s see how plays out in the ‘real’ world of online commerce

1. Customer attempts to checkout
2. Site fails the customer (cart issue, site error message, UI issue, 404…)
3. Customer abandons with items left in the cart
4. Remarketing kicks in – the customer gets email invite to re-engage, along with a discount
5. Customer attempts to convert
6. Site Fails, Again

Ouch, you are now blindly encouraging the failure, customer after customer, putting your brand at risk and you didn’t even see it. Can you think of a worst case scenario?

Your Customer‘s Reaction:

1. After your marketing dollars create demand, they give up on your site and buy from the competition, which is simple online – that competitor is merely a couple clicks away.
2. They spread the word that your site failed them,  frequently on widely disseminated channels, such as  blogs, review sites or social networks
3. They unsubscribe from your email list, or even worse mark you as “SPAM” out of anger

That potential  customer who started out trying to give you money has now become a brand liability.  This occurrence in volume can affect your email sender score threatening to send your following campaigns right to the junk/SPAM folder.

Extreme example? Yes. Possible? Sure.  Pete Blackshaw wrote a book on just the topic, ‘Angry Customers tell 3,000’ and Forbes.com turned the topic and event panel into a 3 minute video, ‘Cyber Shoppers Complain’.

Death by 1,000 Cuts

You have now lost an online sale which could trickle into off-line brand avoidance and with social media influence, potentially impact your ability to attract future customers.  Internally, your email manager is wondering why the opt-out rate is increasing (even with successful opens and clicks) and your line-of-business owner sees high-value customers leaving your database.  Your long-term customer valuation metrics start dipping south and without visibility into the user’s online behavior, everyone starts asking the question, “Why”?

When the sink overflows the first thought might be to grab the towel… You may want to turn the water off first….

Look hard into your abandonments, meet with your entire marketing team and asking the hard questions, starting with ”Why are people not completing transactions?”.  Discovering, indentifying and fixing these issues will not only improve your overall conversion rate immediately, it will fine tune all associated remarketing efforts.   Your email team will thank you, along with your boss, shareholders and oh… your customers too.

-- Dave Ewart, Director, Online Marketing

* Coremetrics Benchmark 2008 December US Retail Report

Comments

[Sean Power]

great post Dave. However, I think that it's dangerous to ask the question "”Why are people not completing transactions?” internally. A marketing team needs to rely on gut instinct and previous experience instead of hard numbers and measurements. I do believe that the question you ask is the most important one to ask - just that it needs to be asked to those abandoning through voice of the customer tools. You can try and guess your customers motivations .. but wouldn't it be better to simply ask 'em :)

again, neat post. cart abandonment is certainly a very frustrating issue :)

[Dave Ewart]

Thanks Sean.
I completely agree on incorporating Voice of Customer tools to understand motivations, we have great partners doing just that (ForeSee and OpinionLab). I'll add, it becomes even more powerful when those comments are tied to the user’s actual experience. Receiving "Your website failed me" comments from any channel without proper context can be ambiguous and slow to solve: marketing issue, server error, usability?

However, marry that and any other customer feedback to the actual visitor’s session and you have the complete view and actionable data. In this case, a possible adjustment to the remarketing effort by removing those who failed due to site issue or alerting the call-center.

Asking the customer is an obvious way to gather data, but it also requires the customer alert you to the issue. When they leave silently or chose to vent in 3rd party mediums you still need a solution to discover, find and solve the issue as they are not your QA. The best solution: encourage all forms of visitor input (emails, call center, surveys, twitter) and tie back to the experience. You now have knowledge to find others who experienced the same issue or behavior to get complete impact to the business.

In terms of Marketing using gut feel and experience – all good things that are made better when backed directly up with user data. It is amazing how quickly internal discussions get resolved when competing groups sit and watch people attempting to complete transactions. It removes the guesswork and replaces it with hypothesis that can be tested and evaluated for success. This gets everyone on the same page and the organization on the path to being data-driven.