Marc Petican, President, Barclaycard Payments
The pandemic has caused an incredible amount of change in a very short period of time for the retail industry – resulting in as many changes in a year as we would typically see in a three to five year period.
For small retailers, a natural change during the foreclosure was to move their operations online to open up new sources of revenue. One of the challenges that accompanies this transition, however, is increased competition against more established e-commerce brands. There are more companies trading online than ever before, and in some industries the battle for consumer spending has become increasingly competitive.
As competition remains fierce in all areas, it is imperative that retailers do not lose customers during the checkout phase, especially when payment is about to be made. In fact, recent Barclaycard payments research showed that retailers have missed £ 39.4 billion in abandoned shopping cart sales online in the past 12 months.
There are many reasons why consumers abandon the process at the time of purchase or do not complete the checkout process. Our study found that customers discovering high delivery costs at the last minute are responsible for 37% of abandoned purchases, while “online shopping” and lengthy authentication processes account for 26% and 24%, respectively.
The data also showed that only 69 percent of merchants are able to identify the average cart abandonment rate on their website. Although this is a significant improvement over 25% over the same research Three years ago, that means nearly a third of online retailers are missing important information to help convert sales.
As part of our research and willingness to provide practical advice to get customers through checkout and beyond, we’ve partnered with retail expert Clare Bailey to produce Seven Tips helpful tools that can help retailers maximize online sales and minimize abandoned carts.
- Examine your shipping costs against the cart value and the total customer value – customers will abandon their basket if they feel that the delivery costs are not proportional to the overall value of the basket, or if they know that a competitor can offer free delivery.
- Use remarketing techniques and buy now incentives – customers react favorably to discount codes and other special offers. While on the one hand you give a certain margin, on the other you close the loop on cyber shopping, securing this customer and preventing him from going to the competition.
- Facilitate transactions – a long process to complete an order is a complete stoppage for customers! Minimize data capture to maximize transaction completion – once you’ve secured the transaction, you can still invite the customer to sign up for a loyalty program or similar to learn more about them.
- Evaluate the cost of developing and maintaining an application with the sales you lose – for some, an app adds a new channel and is exactly the format their consumers love; for others, it is an expensive choice that does not suit their clients.
- Improve the convenience of the payment process – don’t let the difference between you and your competitors be made because they offer a smoother payment experience. One way to reduce cart abandonment is the integration of a “swipe to buy” or a better online payment gateway.
- Know your customers – it seems obvious but, as this research shows, many companies simply do not properly analyze their customers’ data to understand their behaviors and preferences. There is a wealth of information right there in your website analytics – use it effectively to be more customer-centric.
- Be safe – with customers so much more aware of the need to protect their personal data, retailers need to make sure they are adopting all of the latest standards and practices to protect customers. A single data breach can lead to a huge loss in sales if customers feel they can’t trust you. So don’t underestimate the importance of security.
Together, tips and solutions that help small businesses succeed online are essential. After all, if e-commerce is the future of all businesses, then the process of sustainability must begin now.