• February 1, 2015
  • By Leonard Klie, Editor, CRM magazine and SmartCustomerService.com

The Keys to Countering Cart Abandonment

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Research from eDigital Research and IMRG found that 77 percent of online shoppers abandon their carts before completing their purchases. This equates to more than $4 trillion worth of merchandise abandoned in online shopping carts in 2014, according to recent research from BI Intelligence. This report says that online retailers can recover more than 60 percent—or $2.4 trillion—of that amount, but such recovery must be done via the right channel and in a timely fashion.

"We do not know why so many people abandon [their carts], but a lot of times, it is likely because they did not like the final price of the item once they got it in their carts," says Sucharita Mulpuru, a Forrester Research vice president and principal analyst covering e-commerce and channel strategy.

"If you see that someone has abandoned a cart, the first thing you should do is send an email reminder, optimized and personalized to entice them to come back to the site and complete the purchase," Mulpuru says. Email, she adds, is likely the best outreach channel, given that the consumer is already online and can usually click on links sent within an email without having to take additional steps.

When an initial email doesn't work, some retailers have had success with push notifications to the customers' cell phones a day later, according to Kerry Reilly, director of product marketing at Adobe Campaign.

"An enhanced offer, like free shipping on the item already in their cart, will be most successful," Mulpuru says.

That does, however, expose online retailers to consumers who intentionally abandon their carts in the hope that the retailer will respond with a discount or other money-saving offer. This is the reason for 25 percent of cart abandonment, according to Andrew Pearson, vice president of marketing at Windsor Circle, a provider of customer retargeting software.

To combat this, Windsor Circle in August upgraded its Cart Recovery Solution with features that rely on a predictive scoring matrix to identify shoppers who frequently abandon their carts with the hope that companies will sweeten deals. The solution automatically removes discount codes from follow-up emails sent to those consumers.

"You're training customers to abandon their carts by offering them deals right away," Pearson says. "You're giving them an incentive to abandon their carts, and that's problematic because you're sacrificing margins."

But perhaps even more dangerous is not doing anything at all, which is usually what occurs, according to Mulpuru. "There's not a lot that [companies] are doing right now," she says.

To illustrate this, eConsultancy's Christopher Ratcliff went shopping on the e-commerce sites of 45 U.S. and U.K. retailers and then abandoned his cart on each to see what would happen. Five days after abandoning those carts, he had received emails from just three of the retailers.

In a recent blog, he noted that while sending an email immediately after the abandonment might make the retailer seem desperate, one sent within an hour asking if the customer had technical difficulties or if something went wrong with the purchase would be helpful.

An hour is best, according to Reilly. "Twenty to thirty minutes is creepy, but an hour is good," she says.

Adobe has numbers to back this up. According to the company's research, 90 percent of cart abandonments are lost forever after about an hour, and companies that reach out an hour after the cart is abandoned recover two-and-a-half times more customers.

For customers retargeted within the hour, the cart value grows by 66 percent, meaning that after the retailer lures them back to the site, the customers are putting more items in their carts before checking out, Reilly says.

Ratcliff goes on to advise retailers to include the abandoned items in the email, with links to the items and a note about how many of those items are still in stock. A sense of urgency and a call to action is always a good idea, he says.

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