Why Shopping Cart Abandonment might be a good thing

By Charles Nicholls
Founder, SeeWhy

It has been a personal quest of mine for some time to understand online buyer behavior. On average, 71% of shopping carts are abandoned without a purchase. But, what are the unique predictive factors that determine the likelihood of an abandoner becoming a buyer?

Research has told us why visitors say they abandon. For example, Forrester Research asked almost 3,000 people why they abandon, and the top five reasons can be grouped into price and timing objections. But there is another way of looking at the reasons behind abandonment: not what they say, but what they do.

In New York, I’ll be presenting the results of the most extensive study ever conducted into the behavior of website visitors when they abandon their shopping carts. We analyzed the behavior of more than 600,000 people and a quarter of a million online transactions to understand what people actually do when they buy, and in particular, their behavior when they abandon.

Surprising truths emerged…

Conventional wisdom suggests that website conversion is good, and abandonment is bad. Yet, the first major conclusion of this research is that not all shopping cart abandonment is bad. In fact, shopping cart abandonment is an important part of the normal buying cycle for many customers, and for many types of purchase.

You would be right to conclude from this that abandonment, rather than being a rejection of the brand’s value proposition, can be a step in the decision process for some buyers and for some purchases. We generally expect that higher value shopping carts are abandoned more frequently as customers naturally take longer to consider their purchases. This data supports how some customers will come back multiple times as they consider the purchase, storing items in their shopping carts as ‘wish lists.’

The research also exposes some major exceptions to the buying pattern. For example, abandonment rates are very high for lower value purchases, in which the cost of shipping is disproportionately high. Equally, as the value of the cart approaches $100, the abandonment rate shoots up. So, it should come as no surprise that Macy’s has recently introduced a flat $99 free shipping rate across its site to combat this phenomenon.

What this data really says is that we need to rethink the way they view abandonment. For many customers, abandonment is part of the normal purchase cycle. This is not restricted only to new customers, but applies across the board, including a site’s most loyal repeat buyers.

We also need to consider how to support buyers during their consideration cycle. Getting visitors back to the site dramatically increases the chances of closing a sale. This explains why email re-marketing works so well. Rather than looking at customers as lost when their sessions end, remarketing can continue the dialog with the customer and keep them engaged as they go through their consideration process.

About the Author

Charles Nicholls Founder, SeeWhyCharles Nicholls is Founder and Chief Strategy Officer of SeeWhy, blogger, ecommerce visionary, and author of ‘The Top Ten Converting Websites’ and ‘In Search of Insight.’

Recognizing that traditional Web Analytic approaches are limited to historical analysis, Nicholls founded SeeWhy in 2003 to make ecommerce more relevant to individual visitors and customers through real time web analytics. Nicholls, a 20-year veteran of the software industry in the US and Europe, is internationally recognized as one of the preeminent thinkers in the Analytics space. In 2003 The Massachusetts Institute of Technology selected Nicholls as a global leader in Intrapreneurship following his highly innovative creation of Business Objects Analytics. In his role as an advisor to leading companies globally, Nicholls has worked with many of the world’s top companies on their web and customer analytics programs, including Amazon.com, Ebay, Lands End, MasterCard and a many smaller companies.

Before creating SeeWhy, Nicholls was an executive officer of real-time analytics company HNC Software (now Fair Isaac). Prior to HNC, Nicholls spent 6 years at Business Objects (now SAP), where he founded and led the Business Objects Analytics division. Nicholls also founded Ithena, an award winning Silicon Valley CRM analytics startup, which Nicholls merged with Business Objects in 2000.

See Charles Live!

Charles will be speaking with Ben Jesson, from Conversion Rate Experts in a session titled, “The Science Behind Abandonment Recovery & 15 Tools That Reveal Why They Abandon” at Conversion Conference East 2011 in New York City. See the full agenda and read more about this session.

Want to save on your Conversion Conference Registration? Check out Charles’ blog, Seewhy Blog and follow him on Twitter and request a discount code!

4 thoughts on “Why Shopping Cart Abandonment might be a good thing

  1. I love this stuff – it’s fascinating to piece together the clues within the data to understand buyer behaviour.

    It’s easy to immediately draw the conclusion that abandonment is bad, but the logic around repeat trips and using carts as shopping lists makes sense. Would love to see the findings from the research to support this.

    Any chance this will be shared at Conversion Conference London too in late November?

  2. I love this stuff – it’s fascinating to piece together the clues within the data to understand buyer behaviour.

    It’s easy to immediately draw the conclusion that abandonment is bad, but the logic around repeat trips and using carts as shopping lists makes sense. Would love to see the findings from the research to support this.

    Any chance this will be shared at Conversion Conference London too in late November?

  3. Yes, Gary it is very fascinating stuff. Charles will be in London in November so be sure and connect with him on Twitter and ask him about the research findings. Thanks for the comment.

  4. Yes, Gary it is very fascinating stuff. Charles will be in London in November so be sure and connect with him on Twitter and ask him about the research findings. Thanks for the comment.

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