In 2023, smaller eCommerce businesses need to reimagine the entirety of their user experience. Whether it's advertising, customer service, or maintaining brand visibility in an increasingly crowded marketplace, there’s virtually no area that should remain overlooked when reevaluating the UX of your online store.
That's especially true when it comes to one of the most critical elements of your business: the checkout stage.
Naturally, increasing your overall conversion rates is going to be one of the chief priorities of your eCommerce business. But overlooking your checkout completion rate can impact your overall conversions more than you might expect.
Impulse Purchases: An Unexpected Boost to Your Conversion Rates?
Online shoppers aren't necessarily as fickle as you might expect. In fact, a recent survey from Kantar indicates that 58 percent of consumers spent more money spontaneously when making an online purchase in 2022.
But that number pales in comparison to the 79 percent of brick-and-mortar shoppers who regularly make impulse purchases reported by that same survey.
It's not hard to see why. For every online impulse purchase successfully completed, there are countless others that remain stalled, stagnant, and ultimately abandoned.
But it's not necessarily due to a last-minute decision. It has to do with the checkout process.
Uncompleted purchases are on the rise, with the average cart abandonment rate soaring to nearly 70 percent, according to recent data from the Baymard Institute.
Contrary to popular opinion, it's not just additional fees that can result in shopping cart abandonment. A poor checkout experience will ultimately ruin your conversion rate altogether.
Why Your Checkout Conversion Rate Matter?
If you've established a fail-proof sales funnel, then all your customers have to do is simply click “pay” correct?
Reality paints a different picture. Recent surveys indicated that the average conversion rate for eCommerce businesses across both mobile and web was as high as 3.65 percent in 2022.
That's a fairly high number, and significantly more than the standard 1.5 percent benchmark eCommerce vendors have historically adhered to.
But it doesn't take into consideration the average add-to-cart conversion rate. And that's for a very good reason.
There isn't one. Add-to-cart conversion rates vary by both industry, product line, and seasonal sales, with metrics including market saturation and demographic growth impacting your bottom line.
Calculating your checkout conversion rate
Calculating your checkout conversion rate is a fairly simple process. Just take the number of conversions from any source (for example, organic visits, paid traffic, or marketing emails) and divide it by the number of total clicks or visits.
Here's a simple formula to remember: conversion rate = orders/number of visits x 100 percent.
For example, if your latest PPC campaign resulted in 1,000 clicks but only 30 sales, your conversion rate would be 3 percent. A respectable number, but one that's still lower than the average online conversion rate.
Obviously, calculating your conversion rates is critical to understanding the performance of your marketing channels. But there's one factor you may not have thought of when considering just why your checkout conversion rates aren't as high as they should be.
Your shopping cart abandonment rate.
Why Do Customers Abandon Shopping Carts?
It's been reported that eCommerce storefronts lose approximately $18 Billion in revenue per year as a result of shopping cart abandonment, with the total value of products being abandoned predicted to be as high as $4 Trillion.
While the rising cost of additional fees including shipping, taxes, and applicable service charges continues to be the primary reason behind the increase in checkout abandonment rates, recent studies indicate that nearly 70 percent of potential customers experienced issues with checkout page flow & design in 2021.
That same research found that some $260 Billion worth of merchandise could be recoverable simply by improving process and design at the checkout stage.
Personalization and checkout abandonment
A 2020 poll from Nielsen found that some 30 percent of first-time online shoppers were now making multiple purchases a week during the pandemic. And the frequency of those purchases will be likely to increase in spite of loosened restrictions.
But even relative newcomers to shopping online have come to expect an experience that is custom fit to their needs. Customers demand personalization in all aspects of their shopping journey—including the ability to pay exactly how they want with a purchase process that's right for them.
That's why there's an increasing focus on alternative payment methods, including e-wallets and "Buy Now, Pay Later" (BNPL) options, for checkout pages. They're not only more secure than providing traditional bank or credit card information. They provide customers with the flexibility they demand from brands in 2023, helping to reduce checkout abandonment rates simply by accommodating changing consumer needs.
And accommodation goes a long, long way in securing customer loyalty.
How to Improve Your Checkout Conversion Rate
Optimize your mobile design
It's been predicted that mobile commerce will reach some $620.97 Billion globally by 2024, accounting for almost 43 percent of all eCommerce retail sales.
Yet poor design still continues to hamper mobile checkout, with some estimates placing cart abandonment rates as high as 85.6 percent. Slow load times are a common problem with mobile eCommerce storefronts, with pop-up redirections only serving to aggravate users.
While designing a storefront for a separate mobile app is ideal, you may want to consider the following tips to improve mobile accessibility:
Place all key elements of your page to be accessible by fingers, not a mouse.
Ensure your form fields are vertically aligned to ensure ease of navigation.
UI elements, including wider buttons and increment selectors, are more mobile-friendly than a desktop drop-down menu.
Increasing your font size for mobile accessibility, as well as enduring you're using larger and tappable buttons, can improve accuracy during the checkout process.
Reduce the number of images on your checkout page for a faster loading form
Simplify the checkout process
One of Amazon's chief strengths has always been one of sheer convenience—a convenience that makes a decisive impact on the overall customer experience. And that extends to their entire checkout process, as well.
One-click shopping may seem like an amenity. But there's a psychology behind it. A single-page checkout process is much shorter than a multi-page checkout, adding an unspoken but urgent incentive for customers to complete their purchase before FOMO sets in.
Few customers have the time or patience to fill out multiple forms once they've made their minds about a purchase. In fact, it's among the top 5 reasons why carts are abandoned in the US.
Similarly, 24 percent of consumers ultimately abandon their carts after being requested to create an account. Over 48 percent of online retailers have indicated that guest checkout options have been critical to increasing checkout conversion rates.
Integrating autocomplete and smart forms (including Google Autofill) for repeat customers can drastically reduce time between browsing and a completed transaction.
Shopping cart recovery emails
There are various reasons why a potential customer may choose to abandon their shopping cart mid-purchase. But very rarely do casual browsers actually add an item to their cart before changing their minds.
You're not going to be able to persuade everyone who abandons their cart to come back and complete their checkout. But you may be able to offer free shipping, promotional discount codes or any other added incentive through follow-up emails.
Shopping cart recovery emails may seem pushy. But they're effective. A recent report from Klayvio indicates that recovery emails have an open rate of more than 41 percent and a click-through rate of 9.5 percent.
Customer retention may not always seem like the easiest task in eCommerce. But sometimes, all a lost customer needs is just a little nudge.
Offer alternative payment options
Not every customer is comfortable with credit card transactions online.
56 percent of online shoppers have indicated that limited payment options affect their purchasing decisions, while 85 percent of retailers have cited poor payment experiences as the chief reason for lost sales.
With over 35 percent of digital consumers using e-wallets in 2020 during their shopping experience, the importance of integrating non-bank purchase methods into your payment process can't be understated.
Nor can allowing multiple payment options—particularly for larger purchases. While recent purchasing models such as BNPL have allowed an estimated 43 percent of US consumers a flexible alternative to big ticket purchases they normally wouldn't consider, they're not without drawbacks.
Smaller businesses, in particular, need to weigh any profit margin made on payment installments against the fees charged by third-party financial tech providers. Brands that are just starting to establish themselves may not see any revenue lift whatsoever, while certain product lines won't see any profit margin at all.
Customer Experience and Your Checkout Page
Brand loyalty is built on customer experience as much as it's built on your brand. And customers want an experience that's flexible and tailor-made for their lifestyles.
That includes their checkout options.
Online conversions may not rest entirely on your checkout page. You may be currently overlooking your checkout conversion rate, but that doesn't mean it's any less important to your business.
But it's also just one factor among many that affect your business. Conversion rates don't end at the checkout page.
They last the entire life cycle of your brand.
Retaining customers isn't always a question of making the final sale. It's a question of getting customers to return. Find out more at Color More Lines
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