Don't Blame Payments for Abandoned Carts Online

Don't Blame Payments for Abandoned Carts Online

Don't Blame Payments for Abandoned Carts Online

Jonathan O'Connor

Jonathan O'Connor

Jonathan O’Connor translates data into compelling stories as a part of the payment insights team at Auriemma Consulting Group, a boutique management firm specializing in the payments and lending space.

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Online shoppers face less friction than their in-store counterparts, but as it turns out, the path to purchase is a winding road.

The internet has made it easy to compare prices, product features and retailers before ever clicking 'Add to Cart.' But even then, there is no guarantee of an immediate checkout. Simply put, savvy shoppers aren’t in a rush. They are waiting for merchants to give them what they want, and they’ll let their carts collect cobwebs until they find the deal they're looking for.

More than three-quarters of consumers have abandoned an online shopping cart before, according to recent research conducted by Auriemma Consulting Group. Online cart abandonment, however, is temporary and rarely caused by the checkout process. So why are consumers abandoning their online carts? How often are they abandoned? And what can retailers do to get their customers to complete their purchases?

Why consumers abandon their carts

Not surprisingly, more than 50 percent of consumers add items to an online cart at least monthly, according to the report. But most of these transactions aren't completed in one sitting. In fact, only 19 percent of respondents typically complete their order the same day it's started. In other words, online shoppers feel little urgency about pending purchases, and are abandoning carts for a number of reasons.

When asked why they abandoned their online carts, survey respondents were allowed to give more than one answer. The most common reason (50 percent) for cart abandonment cited was simply that they "changed their minds" about making a purchase.

But price considerations came into play as well. One-third of cart abandoners did so because they found a better price at another merchant, and only slightly fewer deserted their carts in hopes that the item would one day go on sale (29 percent). An equal proportion decided they would hold off on checking out until they met a free shipping or discount minimum.

While reasons for delaying an online purchase focused on price and potential savings, payment options are noticeably absent from the top considerations. The burden then falls on merchants, not issuers, to get their customers to complete their online purchase.

Payments are not responsible

Payment-centric reasons are the least commonly cited cause of abandoning online carts. Less than one in 10 consumers say they abandoned their cart because they didn't have their payment information handy (7 percent), their transaction wouldn't go through (3 percent), or their preferred card was not accepted (1 percent). This is in stark contrast to the top reasons previously cited by respondents, which are much more merchant-controlled.

Once payment information is saved with a merchant, future purchases become easier. Alternatives, such as online checkout services and mobile payments, are also available at some merchants and can be particularly useful when payment information is not on file. Given the choice, seven in 10 consumers prefer using their card on file compared to more than two in 10 who prefer online checkout services such as Apple Pay, Visa Checkout or PayPal.

While less popular, online checkout services are a strong purchase driver for those who use them. Those likely to use an online checkout service think it is more secure, faster and easier than other options. And while online checkout may not push consumers to begin the checkout process online, it encourages completion once a purchase decision has been made. About six in 10 of those who have ever used Apple Pay, PayPal, Visa Checkout and/or Android Pay say it is more likely to make them check out.

Although these services are not instrumental in getting online shoppers to check out, the smooth, secure payment experience they provide does help facilitate their purchase.

Cart abandonment is often temporary

Luckily, online cart abandonment is often temporary. Of those who started an order, but didn't check out immediately, 61 percent did eventually bring more than half of their shopping carts to the e-cashier. And often what brings them back is directly correlated with what made them leave in the first place — items going on sale, product availability and reaching free shipping or discount requirements.

So, how can we ensure purchase completion? Communication. Telling online shoppers when an item in their cart goes on sale and when a previously out-of-stock item becomes available are both effective purchase motivators, as well as offering suggestions on products that will help them reach a free shipping minimum. On average, consumers have abandoned nearly four carts in the past six months. A soft reminder, via email or online advertising, can bring an abandoned cart top-of-mind and get consumers over the hump to complete their purchase.

Check out these additional tips for completing online sales.

Why Do Consumers Abandon Shopping Carts?

The statements and opinions of the writer do not necessarily reflect those of TSYS.

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Jonathan O’Connor

Jonathan O’Connor translates data into compelling stories as a part of the payment insights team at Auriemma Consulting Group, a boutique management firm specializing in the payments and lending space.

On the payment insights team, Jonathan creates reports, based on consumer research, that analyze market-shaping forces such as emerging technologies, changing behaviors and attitudes, and new market entrants. He also co-authors Auriemma's Twitter account (@auriemma_group), where followers get the latest findings from the company's studies.

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