How would you like to add real dollars to your bottom line? Increase conversion? Boost sales? Bump up that AOV? Of course you would. Now, ask any retailer what their top three barriers to conversion and sales are, and you are sure to hear “shopping cart abandonment” somewhere on that list.
What’s the connection? In two words – cart remarketing. SeeWhy did some research and found that:
- On average, 8% of customers return to a site to buy if the company does no remarketing. With a remarketing program in place, however, that average jumps to 26%.
- Yet – incredibly – just 37% of the retailers do “something” as follow up to a customer visit (though usually something like asking customers to sign up for a newsletter). Only 12% did some cart remarketing of any kind, and even fewer truly personalized that follow up.
All in all, that’s some serious money left on the table.
We gathered several experts – Charles Nicholls of SeeWhy, Charlie Cole of Lucky Brand Jeans, and Nancy Miller of Woodcraft for the latest Shop.org Webinar, “Shopping Cart Abandonment Research and Insights”, broadcast on March 28, 2012. While I couldn’t possibly capture in one blog post all the great information and lessons that the panelists shared, here are a few highlights to whet your appetite and entice you and your team to listen to the playback today.
Cart abandonment may be at an all-time high… At first glance, the industry benchmarks aren’t encouraging: the current average shopping cart abandonment rate is 72%, according to Nicholls. Brace yourself: that number is only likely to increase as consumers continue to change. Among brand new (first time) visitors, their research revealed that a mere quarter of one percent (that’s 0.25%) “…will go through and actually complete their purchase on the spot in that first visit.” Put another way, more than 99% of first time visitors will “fall off your single track.”
…but now is actually “part of the purchase journey.” Before you despair, consider this: Nicholls characterized shopping cart abandonment as both a problem and an opportunity – and, no, that’s not marketing spin. Retailers tend to think of “conversion = good; abandonment = bad”, Nicholls noted, but – as with many issues – it’s not remotely as “black and white” as all that. Why? Consumers are fundamentally changing. Likening the purchase path to a multi-stop vs. single trip rail pass, Nicholls explained that many consumers now stop and start multiple times – and in multiple venues (web, smartphone, tablet, in store) – on their path to buying a given product. In other words, that old single track purchase funnel is obsolete.
Why consumers abandon carts: price *and* unique attributes. Per a Forrester Research study, when a consumer abandons a cart, the leading reasons reflect either a price objection (e.g. shipping costs) or a timing objection (the consumer wants to do more research, they aren’t ready to buy yet, etc.). Between August 2011 and March 2012, SeeWhy analyzed over 600,000 visitors and 250,000 transactions to dig deeper into this issue. The study confirmed that cart abandonment can, in fact, “be part of the purchase cycle” – especially for carts that are quite small or once the value jumps to between $100 and $150. “$100 is a psychological mark where everything changes,” Nicholls noted, so, for example, retailers should consider setting their free shipping promotion at the $99 – vs. $100 – threshold.
Cart remarketing benefits the whole business. A well executed cart abandonment strategy provides additional benefits to the business overall, among those: helping retailers learn more about their business, products and customers along the way. For example, while price can have a significant impact on cart abandonment rates, every item has a unique abandonment rate depending on its (unique) attributes. By examining more closely products that have high abandonment rates, retailers can adjust those product detail pages to perhaps direct customers to stores to see the product in person, and/or put in place shipping options (e.g. free returns shipping) to assuage customer concerns about making the “wrong” purchase.
The first 12 hours after a first visit (and abandonment) are critical for remarketing. SeeWhy found that, among consumers who didn’t buy initially, the average elapsed time between that first visit and actual purchase is 19 hours – but that 72% of those who ultimately bought did so within the first 12 hours after that first visit. “Leads do go cold pretty quickly,” Nicholls underscored. Beware launching a quickly-hatched blanket email remarketing program. There are three secrets of success to cart remarketing: timing, tone, and personalization. The panelists also discussed the role of emotion as well as potential pitfalls in a remarketing strategy: how frequently should you follow up via email? How can you use a return site visit to remarket a cart? When – if ever – should you include an offer as part of a remarketing campaign? What’s the right way to personalize? What are the right goals for each email in a remarketing sequence?
Invest and reap the rewards. To learn more about how to best set up and execute your cart remarketing strategy, you’ll have to listen to the webinar playback. And if you’re still not convinced a cart remarketing strategy is worth your time, consider this:
- Charlie Cole of Lucky Brand Jeans emphasized that remarketing accounts for 3% of their $40MM business – that’s $1.2 million, just for executing their remarketing strategy in a smarter, more timely and personalized manner.
- Nancy Miller of Woodcraft reported that, “The abandoned cart campaign is number 1 in terms of conversion rate, ROI and per visit value. Comparing this campaign to all other direct email campaigns, the conversion rate is 618% higher, and the per visit value is 675% higher.”
With stats like that, what are you waiting for?