The latest Baymard Institute report on ecommerce indicates that online shopping cart abandonment rates are rising. In 2015, the abandonment rate averaged 72.75 percent, which was over 5 percent higher than one year before.
Listrack, one of Baymard's sources, revealed the recently measured six-month abandonment average had risen to 76 percent. A closer look at Listrack's bi-weekly trending index revealed a 5 percent jump in late May, which has been sustained in the weeks following. This suggests the latter half of 2016 could end with an even higher abandonment average.
Why are online shoppers dropping out of the buying experience three times faster than they're transacting business? Simplify Commerce by MasterCard cited "website issues, check-out process optimization and outside factors" as three top issues that interrupt an online shopper's buying experience. Other researchers speculate the emergence of comparison browsing on mobile devices and security concerns are potential causes for lower conversions.
Yet sales statistics suggest online shopping is alive and well. For example, a recent Bloomberg LP report indicated a 1.3 percent increase in online sales. And Internet Retailer magazine published statistics from the U.S. Department of Commerce, showing nonstore sales rose 12.2 percent in May 2016 alone. Paired with the rising abandonment rate, this data suggests the base number of online shoppers is on the rise.
According to a statement provided by payment facilitator FuturePay Inc., 25 percent of shoppers said they "would abandon a cart if a retailer doesn't have their preferred payment method." Additional data gathered by the company confirmed an optimized shopping experience will lead to higher conversion rates. "If your user experience doesn't live up to a shopper's expectations, they will quickly move on," FuturePay stated.
An article from Business Insider confirms these claims. According to BI Intelligence research cited in the article, shopping cart abandonment is happening primarily at the point of payment and seems to be directly associated with requests for new information to be entered at checkout. The article stated, "Four of the top five reasons users are bailing out of the checkout process stem from the logistics of entering information through desktop or mobile." This comment follows a rundown of the top abandonment statistics revealed through the study.
This report and others focus on ecommerce usability and conversion trends, all citing lengthy and complicated checkout forms as a major barrier. For example, if shoppers are asked to enter a shipping address or payment information, the chance of cart abandonment reportedly increases by approximately 39 percent.
The desire to reduce shopping cart abandonment is driving initiatives by such behemoth etailers as Amazon.com and Wal-Mart Stores Inc. to tie wallet apps to the checkout process. With streamlined and seamless ways of populating personal data and preferred payment methods, these merchants are disrupting traditional checkout processes.
Their success at tackling abandonment issues may explain the recent wave of wallets emerging into the payments ecosystem. According to the latest data, the number of proprietary wallets in the marketplace has now surpassed 100 and is climbing daily.
Companies like FuturePay, BlueSnap Inc., Magento Inc., and Simplify Commerce are also helping merchants further optimize the shopping experience to minimize abandonment. Through the use of mobile apps and pre-authentication methods, they're enabling merchants to reduce the number of steps a user must take to complete a shopping experience. For example, if a shopper can bypass the need to login or create an account to purchase goods, that shopper is reportedly 23 percent more likely to finalize a shopping transaction.
In short, less friction is the theme behind optimizing checkout and minimizing abandonment. "You probably spend a lot of time on your home page," Scott Fitzgerald, BlueSnap Senior Vice President of Marketing, said in a CNP Expo presentation. "I would suggest you spend as much time on your checkout page."
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