Here’s one of my favourite facts, George Harrison was 26 when The Beatles broke up! A quick disclaimer, I’m a Beatles fan, not massive I mean that’s a big subject in itself – probably a 7/10 on the fan boy scale. If you’re not a fan hopefully to get a sense on just how crazy this is though.
26 is no age to have
conquered the world. I mean, what’s next – what could be next?
Business is full of stats and facts; I spend a meaningful part of my week reading and considering all sorts of numbers, ration etc. It’s hard to choose my favourite business fact, but I do have a favorite statistic connected to ecommerce and it’s this
Ecommerce Abandoned Cart Rates!
The average global cart abandonment rate in Q3 of 2018 was 76.9%. (Source: SaleCycle)
I’m sort of hoping you’re
going to share my wonder at this statistic and almost thank me for bringing it
to your attention.
There are some risks
with this, of course. Firstly there’s a
good chance that I’d actually already know this, as this article is aimed at
people who work in ecommerce, and I’d sort of expect that you probably know
this already. Secondly there’s a chance
that maybe this is just already out there and I’m the last person to know that
cart abandonment is so high.
But let’s get to the
point here – what’s the industry doing about this? When I saw this figure I
almost felt that it should be outlawed – who are these people, nearly 8/10
filling their baskets up and then leaving?
And move to the point what are we the ecommerce industry doing about it
– why hasn’t there been an official War on Carts announced by the United
Nations?
It’s not fair to say nothing
is being done. In fact lots of stuff is
being done – and when I say lots of stuff, I mean lots of emails are being
sent! Yep, that’s right lots of emails –
that’s how ecommerce is taking this down – lots of emails!
It’s probably a good moment now to look at why people actually cart abandon
We can see from the
above chart the main reasons, and topping the cart (by some distance) is Extra
Costs – which one interprets as predominantly ‘shipping’. As we go down the list we can see a
comprehensive list, each making sense, each reason recognizable and in turn we
the ecommerce industry has a response, a hack or work-around to try and
minimize each of these issue in turn!
I passionately believe
that the current solution of emails to recover abandoned carts just doesn’t
make sense, and here’s why.
Chatbots Reduce Abandoned Cart Rates
In early 2019 the number of users using chat platforms (Messenger/Instagram/SMS) actually passed users using social media! Now that really is a stat! So to be clear, chat is now the primary communication channel for those below 35 and will soon be the primary channel for all of us is this current trend continues (and it will). Email, on the other hand doesn’t make sense to be the primary channel to communicate with people who have left their shopping on our cart!
Let’s work through
this example below
- 100 shoppers
visit your site and add an item to your cart - Only 23 will
purchase, leaving 77 carts abandoned!
Some more stats –
- The average
abandoned cart email open rate is 45% (Mosend 2019) - The average
click through rate is 21% - Conversion
rate is 10.71%
Going back to our
example, we have 23 people who have abandoned, therefore:
23 people x 45% open rate = 10
people
10 people convert to purchase at
10.71% = 1 person!
The above example is
generally as good as it gets. There will
be certain companies with killer email scripts and headlines, but it’s not the
scripts that will make the difference anymore – it’s the platform.
Using chat marketing
to help reduce abandoned cart can literally be a game changer. Taking Facebook Messenger as an example, the largest of all chat platforms – current
open rates on ecommerce are anywhere from 60-95%!
Using the above
example – if you were to use Messenger in your recovery process we can see you
can double your recovery!
23 people x 80% open rate = 18
people
17 people convert to purchase at
10.71% = 2 persons!
The introduction of
‘chat’ into the marketing mix for ecommerce is only just beginning but
threatens to happen fast. With almost
48% of all ecommerce sales coming from repeat business and the main way to communicate
with that 48% being through email – it makes sense for ecommerce companies to
start considering moving to a chat first approach.
To finish on a George Harrison quote – Life goes on within you and without you. The same goes for ecommerce – those companies that grasp the nettle and start to make changes to the way they communicate will see the returns, but people will continue to shop even if you don’t – it just might be a little harder to speak with those people going forward!
