How to drive revenue from abandoned carts
Abandoned carts are a problem for many businesses. December is the month with the highest level of online basket abandonment, followed by November and January. With cart abandonment rates averaging around 70%, that’s a lot of missed revenue. In fact, it’s estimated that abandoned carts cost ecommerce businesses $18 billion a year.
Customer acquisition isn’t cheap, and nurturing a customer to checkout takes time and effort, so we don’t want to lose them at the final hurdle.
An abandoned cart is especially damaging if a customer goes on to purchase from, and form a lifelong loyalty to, another brand. Of those who abandoned their online cart, 26% went on to buy the item from another retailer. This issue is more prominent with younger customers, retailers identify millennial shoppers (aged 25-34) as the most indecisive online, followed by 18-24-year-olds.
What can you do about abandoned carts?
Marketing automation allows you to target customers based on their actions, or inactions. This is especially relevant to abandoned cart situations. You have a pool of customers who’ve expressed an interest in your product, so utilize email marketing and SMS to keep the conversation going – even after a customer has abandoned their cart.
Can abandoned cart campaigns work outside of ecommerce?
It’s important not to think of abandoned cart programs as only applicable to B2C or ecommerce brands. Abandoned browse emails can be used in a very similar way. For a B2B brand or service consider what your high intent actions are. Whether it’s filling in a form or viewing a pricing page, you can create abandoned browse emails to capture any customers who drop off without completing an action.
Apply similar tactics as ecommerce brands, identify what the hang-up could be, and address it in your follow up automation.
Why do customers abandon carts?
The reason people are abandoning their carts are plentiful, a study found that:
- 48% of customers abandoned their cart as extra costs were too high (taxes, shipping, etc.)
- 24% didn’t want to create an account
- 22% said delivery options were too slow
- 18% didn’t trust the site with their payment card information
Other reasons cited were that the site took too long, the returns policy wasn’t up to scratch, and not enough payment options were available.
How to drive revenue from abandoned carts
Once you know the pain points for your customers, you can address them. The key reasons given by consumers all center around trust, value, and ease.
Social proof is the psychological human behavior of copying others, as if other people are doing something, it indicates it’s a safe, and good, thing to do. Social proof in marketing isn’t a new phenomenon, and it’s extremely powerful – especially to first-time customers who don’t know your brand first-hand yet.
This example from Radley uses subtle social proof by stating that the product is ‘selling fast’. This lets customers know that what they like is approved by others. It also highlights it’s Platinum Feefo review rating, and lets customers know they can read more if they want to.
Share your reviews
Including your overall brand review rating, or specific product ratings relevant to the abandoned cart in question, is a great way to deliver trust. 92% of consumers hesitate to make a purchase if there are no customer reviews, and a huge 92% of B2B buyers are more likely to purchase after reading a trusted review. Dotdigital integrates with review platforms such as Trustpilot, Reviews.io, and Yotpo so that reviews are easily incorporated into your automation campaigns.
Include user-generated content
UGC is content created by your existing customers, such as social media posts, and is great for showing potential customers that others love your brand. Similar to reviews, UGC is centered around social proof. UGC is often less polished, and will feel more genuine to the consumer as it doesn’t come directly from the brand.
Value is key, especially as we are entering a cost of living crisis. In our recent research, 44% of respondents stated ‘the brand has affordable prices’ as a top consideration when choosing a brand to purchase from.
Discounts and data capture
This example from florist brand Bouqs offers a unique looking discount code to the customer to get them to shop their abandoned cart. The email also features an SMS marketing capture block, offering an even higher discount to the customer in exchange for their details. Offering perks as an incentive for signing up to other marketing channels or your loyalty scheme improves the customer’s experience and increases their lifetime value. It’s win-win.
Discounts and RFM
In terms of discounting, you don’t want to just throw out discounts to everyone. Not only will this impact your bottom line, but customers will get wise to this and start to expect and rely on this before purchasing. Use Dotdigital’s RFM (recency, and frequency modelling) to decipher if a customer needs a discount to get them over the line, or if patience and a nudge will be enough to get them to order at full price.
Discounts and AOV
Another thing to consider is how much is the customer spending, is a discount worthwhile? If you offer a discount that’s conditional on spending over a set amount, you can not only save the abandoned cart, but also increase the order value. This is where you should include AI-powered product recommendations too, making it super easy for the customer to add to their cart.
Make it easy for the customer
Ease is so important in a world where everyone is short on time. It seems obvious, but make sure your abandoned cart campaigns include the products the customer has abandoned. You can do this easily by integrating your store or website with Dotdigital.
A simple customer journey
You want the customer journey to have as few steps as possible, so ensuring that the user can click-through and the item is already in their cart is ideal, or at least on the right page and ready to go. If you’re offering free shipping or other discount incentive, set it up so that this is auto-applied too, and the user doesn’t need to copy and paste codes.
Remember email isn’t the only channel at your disposal. SMS marketing can cut through the noise of a busy inbox to grab customers’ attention. This example from denim brand Good American names the product to jog the shopper’s memory, offers 10% off, and links through to checkout. Keeping it super succinct and to the point.
The downside of online shopping? You can’t fully examine the product or try it on. So returns policies are super important. If you have a strong returns policy, make sure this is communicated in your abandoned cart campaigns.
Beauty brand Paula’s Choice have a block at the end of their email highlighting their benefits such as a money back guarantee, free shipping, free consultations, and free recycling. Highlighting this enforces value through increased ease for the customer, aligned ethical values, plus the money back guarantee negates any feelings of uncertainty for a new customer.
Other perks to highlight include your variety of payment options, and for those impatient shoppers (guilty), shouting about your fast delivery options can also help close the sale.
Setting up an abandoned cart program
So, once you’ve identified the content, how do you set up an automated abandoned cart program?
Setting up an automation program can feel daunting, but it can be as simple or as complex as you have time for. Even a simple ‘You forgot this’ email with the product included will recover more revenue than not sending anything at all. Plus, the beauty of automation is you set it up and then it works away in the background. You need to be reporting on your automation campaigns, that’s how you keep optimizing, but it’s one initial lift with continued revenue in return.
Create a winning abandoned cart campaign
Setting up an abandoned cart program with Dotdigital is easier than you might think. Learn from the experts in this webinar with our partner, Nosto, covering everything you need to know.Watch now