Why e-commerce managers and marketers must support the buying cycle across multiple visits.
Conventional wisdom holds that the majority of visitors abandoning shopping carts are time-wasters, never to return to the site. New research shows that it's time to rethink what we know about abandoners: rather than being a bad thing, abandoning is a signal of intent, leading to a potential future purchase. In this column, let's examine how click-stream data can be used to predict future purchases, and introduce one of your best prospects, the Serial Shopping Cart Abandoner.
As we all know only too well, most website visitors don't buy.
In any given session, 97 percent of website visitors don't buy. This rises to 99.75 percent of first-time visitors. Of the visitors that add a product to the shopping cart, 71 percent don't buy.
I've just completed a study of online buyer behavior, examining in some depth what happens when visitors don't buy.
I analyzed the behavior of more than 600,000 people and a quarter of a million online transactions to understand what people actually do when they buy, and in particular, their behavior when they don't. Next week, I will publish the findings for the first time in an e-book, "The Science Of Shopping Cart Abandonment."
To understand more about abandonment specifically, I created three segments, looking at three different types of shopping cart abandonment behavior:
The patterns of one-time and serial abandoners split almost equally, with 43 percent and 42 percent abandoned transactions. To gauge intent of these different segments, I looked at the percentage that return to buy when sent remarketing emails. This is shown on the pie chart as the Recovery Rate.
On average, 18 percent of one-time abandoners will come back and buy when sent remarketing emails.
Meet the Serial Abandoner, Your Best Prospect
Contrast this with serial abandoners: a massive 48 percent will buy when remarketed. Serial abandoners are 2.6 times more likely to buy than one-time abandoners. It's not really surprising that the more a visitor returns to the site and abandons, the more likely they are to purchase.
This illustrates that abandonment, rather than being considered a "bad" thing, should be interpreted as a signal of intent. In fact, it can be considered a predictor of a potential future purchase.
This is a fascinating finding: it suggests that for the majority, customer abandonment is an essential part of the purchase cycle. As customers have become accustomed to the convenience of storing items in their shopping cart for later purchase, abandonment has become a natural part of their buying cycle.
Perhaps, as a result, we should change the way that we think about abandonment and consider a strategy to support the buying cycle across multiple visits. This is where email remarketing comes to the fore: deliver great service to abandoners, support their decision process, and on average, one in four will come back and purchase. If they abandon multiple times, then almost half will subsequently buy when remarketed.
Recent Goal Abandoners
The data in the pie chart, above, also shows how a recent purchase makes abandonment more likely. Looking at the average number of abandons for each purchase, it rises from 1.3 for all abandoners to 2.2 for this segment.
However, recent goal abandoners have the highest recovery rate at 57 percent. While they are more likely to abandon, they are also most likely to return and purchase.
You can conclude from this finding that recent activity, in the form of either a purchase or abandon, increases the probability of recovering a sale after shopping cart abandonment.
Further investigation of this segment revealed two significant behaviors:
(a) Customers returning to view the details of products they have just purchased, double-checking they had made the right choice; and (b) Customers purchasing complementary products to the original purchase (such as cables for electronics purchases).
The net impact of these two behaviors is a 64 percent higher than normal abandonment rate, and a 43 percent lower-than-normal average order value for recovered transactions from this segment.
To get a copy of "The Science of Shopping Cart Abandonment" sent to you as soon as it is published, click here.
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Charles Nicholls is a leading industry expert on ecommerce, web analytics, social media marketing, and online buyer behavior. He specializes in shopping cart abandonment and email remarketing, and serves as chair of the Conversion Academy. He has authored several books: "Lessons Learned From The Top 10 Converting Websites" and "The Science of Shopping Cart Abandonment," set for publication on December 13, 2011. Charles is a market analyst, blogger, commentator and regular contributor to e-commerce, and analytics publications. He is also founder and chief strategy officer at website conversion company SeeWhy.
Hong Kong, May 5-6, 2015
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