Imagine if more than seven out of every 10 shoppers in a physical store, after pushing their carts down various aisles and picking out the products they wanted, simply abandoned those carts when they got to the checkout line, and left without buying anything.
That’s exactly what’s happening online, according to a recent report by Coresight Research, which found that 74% to 77% of online shopping carts are abandoned at checkout, representing $111 billion to $136 billion in lost sales each year.
The problem will only grow as consumers shift more of their shopping to online retailers, and do more of that shopping with mobile devices. Coresight estimates that “e-commerce penetration (online sales as a proportion of total retail sales) will be 21.2% by the end of 2022 and grow to 30.8% by 2030 — a 45% increase.”
The study also found people shopping via their mobile devices were particularly likely to bail on a purchase — the rate of cart abandonment for shoppers on mobile phones was 83.9%, versus 73.2% for those shopping on a desktop computer.
The checkout experience itself is the problem, according to the report, which notes that the process can be lengthy and complicated, and consumers can be surprised by final prices that are unexpectedly high once added costs like shipping fees and taxes are factored in.
The stage when consumers check the final price of their item is when consumers are most likely to bail on a purchase, the report found, followed by the stage when people are checking shipping and return options.
Coresight surveyed retailers and shoppers for the report, and found that both mainly agreed on the top reasons for cart abandonment — high costs and complicated checkout — but shoppers also cited the lack of alternative payment methods as a top reason.
The report suggests that retailers should find ways to lower costs, offering free or discounted delivery if possible. They should also offer alternative payment options, including digital wallets, gift cards and buy-now-pay-later plans, and streamline the checkout process.
Retailers who fix this problem can expect higher sales and greater customer loyalty, according to the report.