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Why customers abandon carts and what to do about it

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Chirag Taneja
Chirag Taneja
Chirag Taneja is the founder and chief executive officer of Gokwik.

Cart abandonment is a persistent challenge faced by online retailers, causing lost sales and revenue. However, many proactive measures can help curb this problem

 By Chirag Taneja

New Delhi: Cart abandonment is an issue prevalent across the entire global eCommerce market. According to the Baymard Institute, the average cart abandonment rate across industries globally is about 70%.  This means that more than two-thirds of online shopping carts are abandoned before the purchase is completed. In India, the situation is not much different. Many studies suggest that India too registers a high cart abandonment rate, ranging between 60% and 70%.

When customers leave the website without completing a purchase and with items still in the shopping cart, it results in lost sales and revenue, and impacts the overall profitability of an online business.

The reasons for cart abandonment in India can vary, but some common factors include:

  • Online payment security concerns
  • Lack of trust in online retailers and online shopping
  • High shipping costs
  • Lengthy checkout processes.

Additionally, factors like unique demographics and purchasing behaviour of Indian consumers, cultural differences, pricing dynamics, and the evolving Indian e-commerce landscape further contribute to higher cart abandonment rates.

Categories prone to cart abandonment
While cart abandonment is a great concern across all e-commerce categories, some of them are more prone to the phenomenon than others. For instance, fashion and apparel, electronics, and home and furniture are among the categories that typically experience high cart abandonment rates. Often, in these categories, shoppers abandon their carts if they find better deals or discounts on other websites, or if they encounter issues with payment options during checkout.

This is primarily due to factors like:

  • Size and fit concerns
  • High price points of goods sold in these categories
  • Quality and authenticity concerns
  • The need for detailed product information
  • Customisation options

Health, beauty and grocery are other categories that experience a high cart abandonment rate. In contrast, pets, FMCG, gaming, digital products, and food delivery are some categories that are comparatively less prone to cart abandonments.

Why shoppers abandon carts
Factors that lead to cart abandonment can be categorised into several key areas. These include unexpected costs, a complicated checkout process, a lack of trust, and limited payment options.

Unexpected costs such as high shipping fees, taxes, or additional charges that are revealed during the checkout process can be a major factor in cart abandonment. Shoppers may feel deceived or discouraged by hidden costs, leading them to abandon their carts.

A complicated checkout process that involves multiple steps, excessive form filling, or mandatory account creation can also contribute to cart abandonment. Shoppers prefer a quick and easy checkout process that requires minimal effort and time. Any friction or inconvenience during the checkout process can cause shoppers to abandon their carts and look for more user-friendly options.

Trust is crucial in online transactions, and if shoppers do not trust the website or the retailer, they may abandon their carts. Concerns about the security of online payments, privacy, and data protection can all erode trust and lead to cart abandonment. Retailers need to prioritise building trust with their shoppers through secure payment options, transparent policies, and clear communication.

Limited payment options can also be an important factor leading to cart abandonment. Shoppers expect to get a variety of payment options, especially today. These include credit/debit cards, net banking, digital wallets, UPI, EMI, Pay Later and cash on delivery. If one of their preferred payment options is not available or if the checkout process fails to accept a particular payment method, shoppers are highly likely to abandon their carts.

What retailers can do about it

Simplify checkouts
Nearly 46% of carts get abandoned due to a complicated checkout process. The best way to convert this percentage into actual sales is by optimising the checkout process. Reduce the number of steps, minimise form filling, and make it easy to edit and review carts before making a purchase.

Offer incentives
Another way to reduce cart abandonment is by offering discounts and incentives to shoppers. They help encourage shoppers to complete their purchases. However, keep in mind that selecting the right kind of discounts and incentives is critical. If they are not relevant, it will give them another reason to abandon their cart.

Meanwhile, apart from offering regular discounts and incentive schemes, retailers can also offer discounts at the payment stage to further reduce the chances of abandonment. For instance, boAt offers an extra 15% discount to all its shoppers who choose to pay via UPI. This additional rebate acts as a catalyst and ensures conversions.

Provide customer support
Offering seamless customer support throughout the checkout process can significantly help to reduce cart abandonment. Online retailers can offer live chat (web or via WhatsApp), phone support, or email support to help shoppers resolve any queries and concerns they may have during checkout.

Use remarking tactics
Online retailers can use different types of re-marketing tactics to recover abandoned carts. These can include:

  • Sending targeted email and WhatsApp reminders
  • Allowing shoppers to checkout within WhatsApp
  • Offering enticing discounts to lure shoppers to complete the purchase
  • Displaying personalised ads across various platforms

 Offer multiple payment options
Providing multiple payment options and clear information on shipping costs as well as delivery dates is another excellent way to reduce cart abandonment. Shoppers expect transparency and convenience in their online transactions. Online retailers must cater to these expectations to minimise the aftereffects.

For instance, UPI is one of the most commonly used digital payment modes in India today followed by wallets, and credit/debit cards. So, these are a must on every e-commerce website.

Ensure secure payments
Prioritise customer trust. Offer secure payment options and display trust badges or security seals that instil confidence in shoppers. This is highly critical in a country like India where nearly 60% of people still want to transact in cash and show less interest in digital payment modes. The more secure the payment option, the fewer the concerns about making online payments.

Provide transparent pricing
Clearly display all costs—shipping fees, taxes, and any other additional charges, upfront during checkout. This can significantly prevent shoppers from witnessing unpleasant surprises spurring them to flee.

Use mobile-optimised payments
Since a major chunk of the Indian audience shops via mobile apps, retailers must ensure that their payment solutions are mobile-friendly and easy to use. The more flexibility, the better the conversion rate, and vice versa.

To conclude, cart abandonment is a persistent challenge being faced by online retailers, causing lost sales and revenue. However, many proactive measures can help curb this problem. By prioritising website optimization to offer a seamless user experience, simplifying the checkout process, offering attractive discounts and incentives, driving retargeting campaigns, and providing exceptional customer service, online retailers can address common pain points and reduce the risk of cart abandonments.

Chirag Taneja is the founder and chief executive officer of Gokwik.

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