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This is to be the first part of a 3 part series where I look at Abandonment as an eCommerce concept and whether you have a good sense of what your abandonment is and how to monetise it.
The good news is you probably know what your abandonment is. It’s an easy number to work out because it is the opposite of your conversion rate. You are probably also aware of it as a concept but how many of you are actually putting a number to it?
Numbers and KPIs are important, they create specific measurables and focus our minds towards deliverables, so taking the concept of abandonment a step further to quantify it as a number is important.
Let’s say that a good industry standard conversion rate is 2/3% (a metric provided by BigCommerce), this is actually saying your abandonment is 97/98% and no matter how many times you hear that metric, it just doesn't sound great. Being uncomfortable in business is important to compel us to improve, especially in industries like eCommerce, which are changing so rapidly, staying uncomfortable is important and knowing you have a high abandonment can certainly help focus your attention.
Imagine you were a high street retailer in a great location and getting plenty of footfall, every hour you get 100 visitors to your store but 98 of them walk straight back out without buying. There’s no way as a store owner you would stand by without taking any action, instinctively you would go ask the fleeing shoppers why they weren’t buying. Was the product not very good? Was it too expensive? Was it a bad shopping experience? Yet many of us don’t behave that way for our websites, because they’re not physical entities and we can’t see the visitors leaving we’re not compelled to act and try and understand why they’re leaving in their droves.
The value of your traffic goes beyond what you’re making in daily transactional sales. There is potentially huge value to unlock in monetising the traffic by capturing the customer data, either through directly acquiring their email address or by at least being able to re-market to them as their journey continues around the internet.
By focussing on growing your email subscriber base as much as you focus on making sales you create your own engine of future growth within your eCommerce business. Constantly having to go back to outbound marketing tactics such as search engine marketing to acquire new customers (to only convert them at 2%) can become a very expensive business, you need to keep as many of the leads you generate warm until they are ready to convert.
So despite up to 8% of traffic reaching the checkout the industry standard for email acquisition is only up to 5% and the best marketers can get up to 18%, which is almost 4 times the industry standard.
What you can start to see here is that there are 2 types of abandonment - cart abandonment and browser abandonment - and the tactics we need to deploy to reduce them must be hard or soft depending on their nature.
Let’s visualise the problem by reviewing the user journey on the website….
At each of these stages, visitors are leaving the site in massive quantities and we need to think of tactics to recycle the traffic back into the site. Hard and soft tactics should be used in equal measure, and this should depend on how likely the visitor is to become a customer.
The closer an individual is to the checkout and how much they spend on the site should help to determine whether or not you use a hard or soft tactic .The opposite is therefore true of those that spend little time on the site, if they are amongst the 30% that tend to “bounce” off on their first page, we should behave a little more “to the point” in order to retain their custom.
In the next part of this series of blogs, we’ll explore cart abandonment in more detail and some best practice tactics for reducing it.
Can't wait? Contact us to find out more
