The present generation consumers are pretty savvy when it comes to digital technology, but they do not tolerate when their time is wasted - and by that we mean seconds, not minutes, not hours.

‍They want a swift process when it comes to Ecommerce experience.

With Ecommerce on rise, we will explore some effective strategies that retailers can employ to minimize cart abandonment and highlight the perks of an effective Ecommerce Checkout System, a persistent challenge in the realm of online retail.

The phenomenon of cart abandonment remains a significant concern for e-commerce businesses.

Although it's understood that not all visitors will convert into customers, D2C brands can implement numerous proactive measures to D2C avoid cart abandonment and enhance customer retention.

The Ultimate Guide to Reduce Checkout Abandonment and Increase Conversions

Stage II - After adding to Cart

‍This is Stage 2 of drop-off, this is where the simplistic additions of checkout essentials come into play. Reduce Checkout Abandonment is the type of cart abandonment during checkout.

Let’s understand about this below.

What is checkout abandonment and how is it different from cart abandonment?

Checkout abandonment refers to the scenario where a customer initiates the checkout process but leaves the website before completing the purchase. 

This occurs after the items have been added to the shopping cart, and the customer progresses to the checkout page but fails to finalize the transaction. On the other hand, cart abandonment encompasses instances where a customer adds items to their shopping cart but leaves the website without proceeding to the checkout stage.

Ways to Reduce Shopping Cart Abandonment

1. Guest Checkout

35% abandon carts because checkout requires too much personal information.

34% abandon carts because a purchase requires a registration.

Solutions to rectify

Ask for minimum amount of information to complete a purchase - and that’s achieved via ‘Guest Checkout’

• Don’t force potential customers to register upfront
• Offer social logins. This option removes the time taken to create and register while providing enough information for autofill.
• Run a registration campaign post-purchase in order to make their future purchase journeys easier

2. Simple Checkout Process

35.26% of online stores see an increase in conversion rate through improved checkout design.

If an online shopper has to click through a series of pages to make a purchase, the process is confusing. if they don’t know what information you’re asking for, or why you need it – they’re likely to give up halfway through and abandon the purchase/cart.

5.08 steps is the average length of a checkout process (from the moment item(s) are added to cart, to making the purchase), which is pretty long. 

Solutions to rectify

Shorten Checkout Processes - Keep it short.

(Why say lot word when few word do trick - Kevin Malone)

- Be Crystal Clear while asking

Explain the reason behind why you need the information you’re asking for. Knowing the reason helps consumers understand and hence trust – for example, asking for a contact number to provide updates on order delivery progress.

- Add a progress bar 

Showing customers the number of steps involved during checkout reduces frustration - when it’s only few in number.

- Optimise at an intricate level

Checkout your checkout flow - test it yourself first hand, do user testing to make sure it is intuitive and easy to use. 

3. No Unexpected costs at checkout 

The cost of items along with shipping, taxes, and other fees can sometimes be a shock to your customers. This pushes them to abandon their carts. While this may be a budget issue on the part of your customers, that doesn’t mean you can’t address it.

Shipping is usually the “surprise” addition for the customer.

Where 54% of online shoppers stated “shipping costs made the total purchase cost more than expected” and 34% stated “shipping and handling costs were listed too late during the checkout process” as their reason for abandonment.

Solutions to rectify

- Add a Price Calculator Before Checkout

By doing so, you share relevant shipping prices, taxes & fees in a straightforward manner before the customer reaches checkout. This transparency lets your customers feel secure and that they’re getting the best possible deal.

- Free Shipping 

The general rule of shipping advantage in ecommerce works by providing ‘free delivery’. Which is usually applied when the cart value crosses a certain amount; striking the perfect balance on maintaining your bottom line and giving your customers what they want.

This way you have the opportunity to capture more sales, and customers are incentivized to spend more in order to achieve free delivery..

The general accounting is that customers over the age of 40 value free shipping over a percentage discount, whereas 18-40 value percentage discount over free shipping. This will help you craft abandoned cart recovery messages.

Also make It easy to hit the free shipping threshold. Because you wouldn't want it to be too far off from normal purchase ranges, thereby making it ineffective.

44% of abandonment is due to online shoppers who didn’t order enough. If you close that gap, your revenue growth will be exponential.

A profitable threshold ∝ An attainable free shipping threshold 

This is the ideal cross sell and upsell opportunity.

4. Clear Return Policy

Unclear return policies that lead potential customers to abandon carts

Solutions to rectify

Establish a crystal clear & unambiguous return policy.

- Don’t bury sections in your Return Policy

Nothing should be inconvenient or inaccessible. Consider placing your return policy in the footer or somewhere easily accessible. And a link to the policy in key areas such as product detail, checkout etc.

- Create a basic Return Policy 

The simpler it is, the less time it takes to read, comprehend and make a decision.

5. Various Shipping Options

Delivery options based on immediacy or cost is what people generally expect; but some brands don’t offer them.

Solutions to rectify

A Variety of Shipping options to choose from.‍

- The Expensive Option

Don’t hesitate to showcase higher prices for overnight shipping or 2 Day deliveries. Select Consumers will pay up for next day delivery, while others may choose to save a couple bucks.

- Flat Rate 

This shipping option is an opportunity to trim your shipping costs and pass those savings on to your customers. Offering flat rate shipping over a lower threshold will be possible once you calculate the average shipping rates for various products, and separate them by shipping costs.

‍- Bulk or Bundle Rates

Offer discounted shipping on purchases over a certain volume of items. This works wonders for smaller or lighter products, while it encourages customers to stock up & spend more. 

6. Ample number of Payment Options

‍The Lack of preferred ways to pay, induces consumers to not go through with the purchase.

59% of buyers will abandon a transaction if their preferred payment method isn’t available.

40% of consumers say they have more confidence in an online shop that has more than two payment methods.

Solutions to rectify

Statistics say that payment options can help recoup 30-60% of sales by customers who abandon a purchase when a card is declined.

Providing a wide range of payment options can be expensive, but as a D2C brand or otherwise, making things easy for customers goes a long way in ecommerce. 

‍If one method faces a hitch, there should always be more than one alternative. For example - if a credit card gets declined for some reason, the consumer wouldn’t go looking for a different card but a different mode of payment. 

‍Cater to the growing BNPL demand: Buy Now Pay Later payment method gives convenience, higher-order values & more transacting customers, and hence stands to provide the highest conversion rate of any payment method.‍

7. Responsive Payment page‍

Even though people have been making purchases online for years, some customers still abandon their carts due to their concerns about online transactions.

In the D2C context, this reduces prepaid orders at its best, and user/cart abandonment at worst. 

‍Only 65% of ecommerce sites display security information 

‍And as a D2C brand, you need to communicate the security of your website to consumers and eradicate any fear or doubt.

Solutions to rectify

Prove you’re safe in every manner

‍- Display Security Seals

Include security badges on your checkout pages, and other key segments to show you have the stamp of approval.

‍Brands saw a sales increase of 4-6% this way 

But make sure that the seals are relevant and easily understandable to your customers.

Because 76% of online buyers say they had abandoned a purchase because they did not recognize the seal

What Causes Checkout Abandonment?

Checkout abandonment occurs when a customer adds items to their cart and proceeds to the checkout stage but leaves without completing the purchase. It differs from cart abandonment, which happens earlier in the shopping process. Identifying the common causes of checkout abandonment helps businesses reduce drop-off rates and improve conversion rates.

Common Causes of Checkout Abandonment

1. Unexpected Costs at Checkout
   • Shoppers are often discouraged when additional fees—like shipping, taxes, or handling costs—are revealed at the final stage.
2. Complicated Checkout Process
   • Lengthy or complex forms requiring too much information can lead to frustration, causing customers to abandon the process.
3. Mandatory Account Creation
   • Forcing customers to create an account can deter them, especially if they prefer a guest checkout option.
4. Concerns About Payment Security
   • If customers are uncertain about the security of the payment gateway, they are less likely to proceed with their purchase.
5. Lack of Preferred Payment Methods
   • Not offering popular payment options like PayPal, Apple Pay, or Buy Now, Pay Later (BNPL) can result in customers leaving the checkout.
6. Slow Website Performance
   • Page load issues or technical glitches during checkout can frustrate customers and lead to abandonment.
7. Unclear Return or Refund Policy
   • If customers are unsure about the return or refund policy, they may hesitate to complete the purchase.
8. Distractions or Second Thoughts

Some customers leave the checkout due to distractions or decide to compare products on other websites before purchasing.

How to Calculate Your Checkout Abandonment Rate (With Examples)

Understanding your checkout abandonment rate allows you to track performance and make data-driven decisions to improve your checkout process. Here’s how you can calculate it:

Formula for Checkout Abandonment Rate

Checkout Abandonment Rate=(Total Checkouts Started−Total Purchases CompletedTotal Checkouts Started)×100\text{Checkout Abandonment Rate} = \left( \frac{\text{Total Checkouts Started} - \text{Total Purchases Completed}}{\text{Total Checkouts Started}} \right) \times 100Checkout Abandonment Rate=(Total Checkouts StartedTotal Checkouts Started−Total Purchases Completed​)×100

Example Calculation

Let’s say your store had 500 checkouts started in a month, but only 350 purchases were completed.

(500−350500)×100=30%\left( \frac{500 - 350}{500} \right) \times 100 = 30\% (500500−350​)×100=30%

This means 30% of shoppers who began the checkout process did not complete their purchase.

Industry Benchmarks

• Retail and Apparel: ~20-30%
• Travel and Hospitality: ~80-85%
• Digital Goods: ~15-20%

If your checkout abandonment rate exceeds industry benchmarks, it’s a clear signal to optimise your checkout process.

Negative Effects of Checkout Abandonment

Checkout abandonment has several negative impacts on your business, affecting not just immediate sales but also your brand’s long-term success.

1. Lost Revenue Opportunities

• Every abandoned checkout represents a missed sales opportunity. Even with efforts to recover lost sales through emails or retargeting, not all abandoned carts convert.

2. Increased Customer Acquisition Costs (CAC)

• If customers abandon their purchase after clicking through from a paid ad, your business incurs acquisition costs without generating revenue, lowering overall ROI.

3. Lower Conversion Rates

• A high checkout abandonment rate negatively impacts your store’s conversion rate, making it harder to meet sales goals.

4. Damage to Customer Experience

• If customers leave the checkout due to a frustrating experience, it can result in negative brand perception and reduce the chances of them returning.

5. Reduced Customer Lifetime Value (CLV)

Losing potential customers at checkout prevents you from turning them into repeat buyers, reducing the long-term value they could provide to your business.

Checkout abandonment rate & statistics: where do you rank?

‍Assess your checkout abandonment rate against industry benchmarks to gauge performance accurately. 

The average card abandonment rate for online shopping stands at 70.19%.

Now compare your metrics with relevant competitors or industry averages to identify areas for improvement and set realistic targets for reducing abandonment rates.

4 ways to reduce checkout abandonment and recover abandoned carts

• Implement an automated email sequence targeting users who abandon their carts, offering incentives like discounts or free shipping to encourage completion.
• Utilize retargeting ads across various platforms to remind users of their abandoned items and incentivize them to return to complete the purchase.
• Optimize the checkout page for speed and simplicity, removing any unnecessary steps or distractions that could deter customers from finalizing their purchase.
• Offer live chat support or a customer service hotline to address any concerns or questions customers may have during the checkout process, potentially resolving issues and increasing conversion rates.

Checkout abandonment email templates and examples

1. Subject: "Complete Your Purchase with a Special Offer Inside!"

Body: "Hi [Name], we noticed you left items in your cart. Complete your purchase now and enjoy [discount/off] on your order. Shop now!"

2. Subject: "Your Items Are Waiting! Don't Miss Out."

Body: "Hello [Name], it looks like you forgot something! Your items are still in your cart. Click below to complete your purchase and enjoy fast shipping."

3. Subject: "Did Something Go Wrong? We're Here to Help."

Body: "Hi [Name], we noticed you didn't complete your purchase. If you encountered any issues or have questions, feel free to reach out to our support team. We're here to assist you every step of the way."

These templates aim to re-engage customers who abandoned their carts and provide them with incentives or assistance to encourage them to finalize their purchase.

How Pragma can help you reduce cart abandonment

Solution through 1Checkout

Providing the highly preferred payment modes doesn’t mean 1Checkout excludes the rest! 

Along with BNPL, we also provide 

• Credit & Debit Cards 
• EMI
• Netbanking
• Wallets

Establish your presence on UPI: By offering the best UPI ID experience to consumers via pre-built 1Checkout APIs - quick & effective methods carried out through QR code and deeplinks.
Solutions through 1Checkout
1Checkout does all the above and also ensures higher success rates and conversions by avoiding incorrect UPI ID entry, browser switching, and drops due to cancellations by mistake. 

COD - Cash on Delivery, is still the most preferred transaction, so, don’t forget that.

‍Always keep in mind:

63% of abandoned carts are recoverable. Follow your actions based on this huge fact.

Work on getting the Revenue Back

Proactively address the root causes for abandonment on your ecommerce site.

Repair your conversion paths and funnel, and take your abandonment strategy to the next level. How? By implementing ‘abandoned cart automation’ & ‘abandoned cart nurturing’ along with other outreach activities to re-engage and recover potential customers. 

Follow the Data - Analyse, Observe, Enhance

The base of abandoned cart strategy and automation is simply Data - or as we call it; ‘Abandoned Cart Analytics’ (ACA).

PS : DO NOT ABANDON YOUR ‘ABANDONED CARTS’. EVER.‍

To learn more about Avoiding Cart Abandonment → Checkout Stage 1 & Stage 3 drop-off blogs.

Rech out to us Here.