So, you have been researching cart abandonment rates, trying to understand your own business’s abandonment issues, only to discover that things are not quite as simple as they seem. You may find that your own rates are much higher than the average. If so, you may even wonder how this is the case.
Is your business performing more poorly than the typical competition? Are you doing something differently that is impacting your online checkout performance or online advertising? Do you simply have a case of bad luck or a losing streak that doesn’t seem to want to go away?
While individual performance is one key factor that influences your specific cart abandonment rate, it isn’t the whole story. It can be tricky trying to determine why your cart abandonment rate differs from the average and what you can do to equal or better it over time. While it is important to understand the specifics of your own business and what works/what does not work, you need to have an accurate understanding of the big picture as well.
To start, you need to understand that cart abandonment rates differ from industry to industry. This means that a large part of your overall success or failure may depend on the industry in which you are doing business. A large number of factors can influence how easy or difficult it is to have a successful performance with an online shopping cart in any given industry.
Here are just a few of the specific factors you should be aware of that differ from industry to industry.
The Challenges of Doing Business with Online Shopping Carts
When they first came about, online shopping carts seemed like the silver bullet of successful online business. On paper, it seems to solve many of the traditional challenges of running a small business, especially in the retail industry. By focusing on online transactions, a shopping cart eliminates much of the largest hassles and financial issues traditional brick-and-mortar stores encounter on a daily basis.
In theory, an online shopping cart can be a more budget-friendly way of doing business with customers. For one thing, it can eliminate the need for a brick-and-mortar space altogether, reducing the financial costs like monthly rent and warehouse storage.
When designed and executed well, an online shopping cart also makes the customer purchasing experience more streamlined and user-friendly, especially when the customer can save time and money from the comfort of their own home. When the checkout process is designed well, it can even entice customers to spend more than they would in a physical retail space.
Unfortunately, the benefits of online shopping carts tend to favor the retail industry. After all, it is much easier to sell physical products like electronic devices and clothes online than other goods and services. Since physical shopping carts are meant for these items, it is easy to see how the retail industry translates well into an online environment. This means other industries can have a difficult time adapting an online shopping cart framework to their own needs. The success of a business experience with an online shopping cart often depends on how well the business plans and adapts an online shopping cart platform.
The Customer Experience
Even though online shopping carts can make buying goods and services online easier, it largely depends on the industry itself. Many industries have a different customer interaction process than the retail industry. Sometimes, relationships last much longer between the business and the customer than the quick checkout process of a typical retail store. Other times, there are no physical products a customer will buy. They may purchase a subscription or get billed on an ongoing basis depending on the type of goods or services.
When the customer purchasing process is drastically different from a typical checkout process in a retail store, a business has to decide if an online shopping cart is actually worth the trouble or not. That is not to say that it is impossible to use an online cart with great success. It is certainly possible but requires some adaptation to make it work for the specific business and industry.
Online freelancers in various industries have discovered this challenge in recent years. More and more individual freelancers and small businesses that specialize in marketing, writing, graphic design and other online services have made the extra effort to make the purchasing experience for the customer more convenient. Instead of dealing with complicated invoicing programs and bills, many freelancers have turned to the online shopping cart experience to simplify things.
The best freelancers and small businesses know how to adapt an online shopping cart framework to the particulars of their own business. For example, an online freelancer who specializes in blog post writing can charge clients per post or word range. They can easily turn their services into abstract goods customers can place in the shopping cart as if they were products.
Typically, any industry that can package their services into an abstract product for the shopping cart will have lower shopping cart abandonment rates than other industries. Individual transactions also tend to be more easily adapted to a shopping cart framework than large corporate relationships.
Business to Business Relationships
Similar to working with individual customers, many small businesses and large corporations alike have tried to adopt online shopping carts to their business to business (B2B) relationships. Once again, the promise of the online shopping cart looks great on paper but often fails to live up to expectations for industries without physical products to sell.
Relationships between businesses are more complex and take more time to establish than the typical customer/small business relationship. Since most large businesses and corporations look for long-term investments, even with each other, the amount of time and effort it takes to create a business to business relationship is naturally more than the typical retail checkout process. This can make it difficult for a business to use an online cart in business to business transactions unless the relationship has already been established.
Once a business has a client at the point where work has begun, an online shopping cart is easier to use if the services and goods themselves can be used in the online environment. Here, businesses and corporations face the same challenges as freelancers in figuring out how to translate their goods and services into something that can be bought through an online checkout process. Those who figure out this challenge often enjoy a smaller cart abandonment rate since they have the power of a long-term relationship. In other words, once two businesses have agreed on ongoing work, the client is less likely to simply abandon the cart since more time and attention has been placed on their needs. In this case, the long-term investment will be a benefit that most online retailers do not experience.
Industries and Online Business
Beyond the challenges of adapting an online cart platform to the specifics of the individual business, there is also the challenge of doing business online in particular industries. Many people assume that any business will thrive online given the natural benefits most small businesses experience–with a little bit of time and dedication. This assumption, however, can be drastically wrong for some specific industries. There are some types of businesses that are suited for traditional means of client interaction or simply can’t take their business online.
B2B, scientific, medical and other specialized industries have long experienced difficulties of doing business online beyond having a simple website and email. The complexity of other industries and the products/services they offer may require more face-to-face communication than an online environment can offer. Sometimes, the clients themselves have an expectation of greater attention and access to a company than is available through website or social media.
If a business, corporation or even entire industry is not really compatible with the online environment, a virtual shopping cart has no hope of succeeding since the digital infrastructure will fail to drop people to the checkout process in the first place. Simply put, customers will have a harder time reaching the shopping cart and using it when they have more hurdles to jump through in terms of the steps they must take to interact with the company.
If an industry can’t figure out how to thrive online, no amount of shopping cart infrastructure will change this outcome. For these types of businesses, sticking with the old traditional way could be more beneficial and profitable in the long run.
Looking Beyond the Industries
When you are trying to assess your own cart abandonment rate and the factors that influence it, it is certainly helpful to have a clear idea of the big picture. This means researching the typical cart abandonment rates for the industry that you work in and the specific challenges other similar businesses experience when using a virtual shopping cart. With this information, you’ll be able to get a better sense of where your own business efforts may need some improvement.
This does not mean, however, that you should focus solely on the big picture. The particulars of your own business, marketing efforts and shopping cart platform will always be more important. Even if you don’t have time to research industry shopping cart abandonment rates and factors, you can do a lot working with just the specifics of your own business. You may make a few avoidable mistakes along the way, but you have to pay attention to the reasons why your own cart abandonment rate maybe at the level it’s at.
Pay attention to the customer shopping experience, particularly through the checkout process. If your business is a traditional retail store, for example, make sure this checkout process is as easy and convenient as possible. An efficient, straightforward checkout process will help customers find reason to purchase the products they put in their cart.
Finally, make sure the products and services you sell are tailored towards the online shopping cart environment. For traditional retail items and products, this should be straightforward. In this case, you should make sure your marketing and overall presentation of these products is clear, creative and in alignment with your overall marketing efforts.
If you have a business that falls outside of retail, you may have to do some research to see how other businesses within the same industry have met the particular challenges you may face. Unfortunately, there is no one solution that always magically works when trying to adapt new technology to old entrepreneurial standards. In other words, you may have to make mistakes or see how others have made them before you.
Most importantly, keep at it. Lowering your cart abandonment rate, regardless of the industry that you operate in, is a process of trial and error. The more time you devote, even if you are making several mistakes along the way, the more you will learn to increase your chance of success. Monitor your budget so you are not spending more money than you have in the process. Be honest with yourself and your efforts. If something isn’t working, revise it or discard it. It is easier to start from scratch or change something drastically instead of keeping your efforts up even when they aren’t working.
Cart abandonment rates may differ between industries, but the process of converting them remains the same: Look at what works, change what doesn’t and keep on until you start to see the change you seek.