EO Partner Presents: Clearing the Path to Purchase
Many businesses contend with tire-kicking shoppers who don't commit to buy, but few companies wrestle with indecisive shoppers more than e-commerce businesses. According to a Forrester Research survey, the average rate of online shopping cart abandonment reported in 2009 was 51%, while others have estimated it as high as 70%. Virtual shopping cart abandonment has pained online retailers since the dawn of online shopping. Initially, shoppers blamed complicated checkout processes or a lack of technical knowledge for their departure, but only about 10% of respondents cited these issues as purchase busters in the Forrester survey.
Today, high shipping costs are often to blame. In fact, it's cited as the biggest culprit in the survey: 44% of the nearly 3,000 respondents reported abandoning their shopping carts for this reason. "Not ready to purchase" was the next reason listed (41%), followed by a desire to comparison shop (27%) and the price being too high (25%). With more consumers comparing prices and migrating across myriad purchasing channels today than ever before, elevated cart abandonment rates are likely here to stay. Here are seven steps you can take to motivate your consumers to complete their online purchases:
1.
Make shipping rates known early in the process, and consider discounts. Six out of 10 online shoppers indicate that shipping costs of up to 10% of the transaction value is reasonable. Not every retailer can afford a free shipping policy, but there should be room to play with shipping offers that are dependent on coupon codes or minimum orders. Whether you offer discount shipping or not, be sure the cost is clearly visible early and often to avoid surprises. In the Forrester survey, 22% of cart abandoners stated that shipping-and-handling costs appeared too late in the checkout process.
2.
Make the purchasing process easy. While site registration supplies valuable customer data, it's also a painful source of lost sales (as much as US$20 million, according to Forrester). Online shopping consultants recommend retailers allow non-registered customers to check out as guests. Afterward, you can offer incentives such as coupons and promotions to entice those customers to register.
3.
Reassure shoppers that their security is a top priority. In a 2009 survey by PayPal and ComScore, 21% of respondents cited security concerns as a reason for abandoning a virtual shopping cart. Anne Holland, founder of the research firm, MarketingSherpa, LLC, recommends posting reassuring security icons throughout e-commerce websites. Be sure to include privacy and security reassurances next to any fields asking for personal data. "It's stunningly easy to do, yet it drives me nuts to see how many merchants still completely ignore it," says Anne.
4.
Create trust. Communicate your online store's trustworthiness. Make your customers feel safe by clearly stating return policies and providing several ways they can reach you, including a phone number, email and postal address.
5.
Provide alternative payment options. Many shoppers prefer to use PayPal, Google Checkout or similar systems so that they can complete online transactions without entering their data for each purchase. According to Forrester, 75% of online purchasers have an alternative payment account.
6.
Ask abandoners why they didn't buy. Some online merchants use exit pop-up surveys for anyone who abandons a cart. But because security software frequently blocks popups, you might have better luck sending a follow-up email. When you notify customers that their carts are waiting if they want to return to your site, you can invite them to explain why they didn't complete their purchase.
7.
Encourage customer reviews by offering discounts. You can encourage online shoppers to share their thoughts— which might encourage others to buy—by following up purchases with personal emails highlighting discounts or adding a link to your e-newsletters. After all, satisfied customers are your most powerful marketing tool.
EO's partnership with FedEx provides EO members in the U.S., Canada and Mexico with valuable discounts on shipping services. For more information, visit www.eopartners.org or contact
[email protected]. For more articles like this one, visit the FedEx Small Business Center at
www.fedex.com/smallbusiness.
