A Lesson Learned from 2009: Shopping Cart Abandonment
Tuesday, January 5, 2010 As we begin the New Year, it’s necessary to reflect on the previous year to recognize our successes and shortcomings. While the recent holiday sales boosted e-commerce by 3.6%
over last year, there is still room for improvement as we enter 2010.
Yes, overall sales did increase, but so did shopping cart abandonment. Shopping cart abandonment averages at about 45% (as high as 60% in some cases), but during the last quarter abandonment jumped to 70% - peaking at 83% in early October. Granted, October’s spike is largely due to customers holding out for holiday sales, but there are still lessons to be learned. Abandonment is an interesting metric because it implies several things:
The customer…
- …was interested in your products.
- …was interested in purchasing from you.
- …was not quite ready to make the purchase.
The last, of course, is the most important implication. Why was the customer not ready to make the purchase? PayPal and comScore, in their Eighth Annual Merchant Survey, identified the main reason why customers abandoned their carts.
- High shipping charges: 46%
- Wanted to comparison shop: 37%
- Lack of money: 36%
- Wanted to look for a coupon: 27%
- Wanted to shop offline: 26%
- Couldn’t find preferred pay option: 24%
- Item unavailable at checkout: 23%
- Couldn’t find customer support: 22%
- Security concerns: 21%
It is interesting to note that price sensitivity accounts for 5 of the top 6 reasons for shopping cart abandonment.
Practical eCommerce gave seven suggestions based on the findings of PayPal and comScore’s survey and McAfee’s whitepaper entitled “Digital Window Shopping: The Long Journey to Buy”.
The suggestions are fairly simple. Improve user experience, increase trust, add value, and reduce distractions. While reducing price isn’t always a feasible solution for online merchants, it is comparatively simple to accomplish Practical eCommerce’s suggestions. In addition to these findings, TrialPay also assists online merchants in reducing abandonment by adding value and reducing distractions.
Shoppers want the biggest bang for their buck. It shouldn’t be a surprise if shoppers abandon their cart to find a better price at an online competitor’s site – even if it is only a fraction of a percent cheaper. To counter this occurrence, online merchants need to add value to their checkout process. While there are many ways to add value to your checkout process, TrialPay is the industry leader with our Get It Free and Purchase Incentives products.
Our Get It Free product has helped millions of price-sensitive customers get products for free by completing an offer for something they would have bought anyway. To learn more about Get It Free click here.
Purchase Incentives give an edge over the competition by adding value (in the form of free gift certificates or movie tickets) to customer carts for simply completing a purchase at your store. Purchase Incentives are much more effective than online coupons. While online coupons can be effective, they definitely are a distraction to online customers especially if they don’t have a coupon code. Coupon or promo boxes highlight the fact that online customers could be getting a better deal. Asking online customers, “Do you have a coupon for that?” increases the cart abandonment up to 27%. Purchase incentives are prompts generated within the shopping cart – keeping customers attention until the checkout is complete. To learn more about Purchase Incentives click here.
In many ways 2009 was a success in the world of e-commerce, but we can’t stop there. Last year was merely a benchmark to improve on. What are you doing to make 2010 a better year for e-commerce?
0Doing Right by the Consumer: Going Beyond Compliance
Thursday, December 17, 2009In October of this year, a TechCrunch article exposed questionable advertising practices in the social gaming industry. Since that time, several major changes have taken place:
1. Facebook has begun enforcing its strict ad guidelines for developers and monetization providers, even banning a few players permanently from the Facebook platform.
2. Social gaming publishers—large and small—have pulled offers from their platform altogether while they review the business practices of their monetization partners.
3. Offer companies have issued press releases ranging from additional ad guidelines to mea culpa pieces asserting that they are now fully Facebook-compliant.
The Must-Haves for
Consumer Satisfaction
At TrialPay, we believe that compliance is not enough. As a social game publisher, you should select a monetization partner who has a company ethos of doing right by the consumer. This week, we are publishing a whitepaper, available for free download. This whitepaper provides the following:
· Top 4 offer categories that appeal to consumers
· 5 best practices for ensuring your offers are consumer-friendly
· 7ways to tell if your offer company is built to deliver consumer satisfaction
Building Sustainable
Revenues in Social Games
Games are the killer app on Facebook, where publishers have
access to over 350 million users. The Inside Virtual Goods
report pegged virtual currency sales at over $1B in 2009 and growing at a clip
of 60%. Recent events such as EA’s
$400M acquisition of Playfish, Playdom’s
$43M Series A and DST’s
$180M investment in Zynga demonstrate that investment and exit
opportunities are alive and well in this industry. How should publishers think
about offers post-ScamVille?
The answer is simple, but execution is complicated. Offers are
a critical ingredient for monetization and presently account for roughly 35% of
total virtual goods sales in the US, or $350M. Delivered poorly, offers can
detract from the consumer experience and potentially harm the reputation of the
entire industry. Done right, offer-based monetization can be significantly
additive to a publisher’s business and enhance game play. As you think about
your selection of monetization partners, we encourage you to keep
these themes in mind and put the consumer first.
If you would like to learn more about going beyond compliance and doing right by the consumer, please read our whitepaper, available for free download by clicking here.
0It's the Season of Giving and Giving Back
Wednesday, December 9, 2009TrialPay is very proud to be a Mountain View company and we're always looking for ways to give back to the community. Unfortunately, there are hundreds of families in our area that need assistance and millions across the nation. Through TheBigBundle and assisting with Community Services Agency's Toy Drive, TrialPay has begun to do its part to help those in need.
Here is a brief look at what we were able to accomplish with the Community Services Agency (CSA) for children in our community.
What can you do for families in your area?
0Black Friday and Cyber Monday Fuel Online Holiday Shopping
Wednesday, December 2, 2009Statistics
from this year’s Black Friday and Cyber Monday prove early industry
projections that consumers
will increasingly shop online for holiday gifts. Black Friday 2009 total
online spending was up 11% over last year. And according to comScore, Cyber Monday 2009 spending was up 5% this
year compared to 2008 (Coremetrics reports the increase as high as 13.7%).
Not only did
this year’s Cyber Monday numbers reflect and increase from 2008, Cyber Monday
2009 sales surpassed Black Friday 2009 online sales. According to Coremetrics’
second annual Cyber Monday Benchmark Report:
- Cyber Monday
continued the momentum set by Black Friday. Sales were up 24.1% compared to
Black Friday 2009.
- Consumers spent more
per online order ($180.03 versus $170.19 for an increase of 5.8%) compared to
Black Friday 2009.
- Sales were up 13.7% compared
to Cyber Monday 2008.
- The average dollar
amount consumers spent per online order rose 38.2% from Cyber Monday 2008
($180.03 versus $130.24), led by apparel retailers.
- Consumers bought
nearly 10% more items per order on Cyber Monday 2009 compared to Black Friday
2009 and nearly 30% more compared to Cyber Monday 2008.
- Cyber Monday 2009
sales matched the heaviest online spending day on record (December 9, 2008).
Industry
experts say the success of both Black Friday and Cyber Monday online sales was driven largely by an increase in shoppers using the Web to make their gift purchases. The most popular sites included retail stores such as Wal-Mart and Target, with Amazon.com taking the top spot on Friday and Monday.
But it wasn’t
just traditional holiday shopping sites that took advantage of the increased traffic
over the holiday weekend. Companies from every industry from airlines to social
games implemented Black Friday and Cyber Monday promotions. In the example
below, Zynga launched a Black Friday sales event that extended until Cyber Monday for virtual goods in it's popular game, Mafia Mars.
This is just the beginning of a potentially record-breaking online holiday shopping season. Forrester Research Analyst Sucharita Mulpuru expects total holiday sales to rise 8% to a record $44.7 billion.
TrialPay Supports Senate Hearing on Aggressive Online Sales Tactics
Tuesday, November 17, 2009This
afternoon the Senate Commerce Committee, chaired by Senator Jay
Rockefeller (D-WV), will hold a hearing on "Aggressive
Sales Tactics on the Internet and their Impact on American Consumers." The committee also released a report on these practices.
The hearing's focus is on deceptive post-transaction offers -- cases in which, after completing an online transaction with one merchant, the consumer receives an offer from an unrelated merchant that often results in the consumer being charged unexpected monthly fees. These post-transaction offers have generated thousands of consumer complaints and deserve close scrutiny from legislators and regulators.
TrialPay cares about this issue because the long-term success of our business depends upon consumers trusting online merchants -- and the kind of post-transaction offers currently under investigation undermine that trust. We are grateful to the Senate Commerce Committee for investigating these deceptive post-transaction offers, and we encourage other companies to join TrialPay in calling for more consumer-friendly industry practices.
Posted by Clint Smith, TrialPay's VP and General Counsel
