Picture this: you have an e-commerce site, you’re driving traffic, consumers are interested in your products, browsing different offerings, and adding items to their cart, but then … the cart is abandoned, and no purchase is made.
In the customer-friendly world of e-commerce, cart abandonment remains a significant challenge, directly impacting revenue potential.
The topic of cart abandonment was front and center on the latest episode of Phonexa’s Amplify webinar series. Francisco Bervis, Director of Business Development at HelpGrid, a premier outbound sales call center dedicated to pioneering solutions for abandoned cart and subscription recovery, joined Phonexa CMO Talar Malakian to discuss the critical issue.
Cart abandonment occurs when potential buyers add items to their online shopping cart but leave the website before completing the purchase. Common reasons for this behavior include unexpected shipping costs, complicated checkout processes, concerns about payment security, or simply browsing without intent to buy.
Addressing this issue is crucial for businesses seeking to optimize online sales and enhance customer experience. Businesses can significantly boost revenue and customer retention by understanding the causes of cart abandonment and implementing effective recovery strategies.
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Cart Abandonment Rates & Potential Revenue Loss
Malakian: Can you provide statistics on the average cart abandon rate according to the industries you deal with? How does a business calculate the potential revenue lost due to abandoned cards?
Bervis: On average, you should expect somewhere around 70% to abandon their cart from when they land onto your actual store. So let’s say you have affiliates, you’re doing some paid media ads, a lot of these individuals are landing on your website, you’ll see the clicks, and then you’ll see how many of those actually convert. And then we’re seeing a lot of those who clicked, they actually went through the portal, they looked at some things, they may be provided some of the information that you’ll be able to see on your cart system. Then, you’ll be able to calculate those stats on your own. Primarily around the industry we’re most familiar with — the health and wellness space for supplements — we’re usually looking at around 70 to 75% of those abandoning their carts.
Inside most cart systems, there will be a cart abandonment area providing the total number of carts that were left behind. You can simplify it by how many carts were left behind per 30 days. And then, in those 30 days, you can see how many people actually purchased their cart. Then you can compare those two and say, ‘Okay, for every singular purchase there’s three to five or three to seven individuals who are abandoning their cart, or maybe there’s one or two individuals per sale.’ That’s how most brands would go ahead and calculate that…if you want to give a dollar amount, you can then look at your average order value and then multiply it by that.
Best Practices for Abandoned Cart Recovery
Malakian: What are some of the best practices for creating effective abandoned cart recovery?
Bervis: Tactics that most brands will go ahead and do are SMS and emails, and the best practices are those that have a great sequence of individuals who purchased, individuals who were interested in certain products, and then pushing them into a CRM where you’ll then be able to let them know ‘so and so was interested in the joint supplement’ or ‘Susan was interested in a magnesium lotion brand.’ Okay, now I know what this customer is interested in — let me push them into a funnel where it’s going to keep promoting this product to them to potentially bring them back into the store. And if I can bring them back into the store, I want to make sure that I’m able to process that first payment.
Any chance that you have any opportunity you have to talk to a client, you need to always make sure that you are the best in the game, that you are listening to them, you’re being empathetic toward them. And definitely make sure that you can build that relationship because the more relationship building that you have with that client, the more that client’s going to come back or potentially talk about you to other individuals, which again, that client value is going up because now they are recommending you, they are talking about you, they are happy with you. Let’s say a brand’s customer lifetime span is three or maybe six months. We’ve seen that the more customer service, the more support that you give certain customers will increase that over time anyway, so it’s worth the effort.
The Impact of Personalized Recommendations
Malakian: How can personalized recommendations impact recovery?
Bervis: I think we’ve all seen this happen in the past when you get an email that says, “Hey there” or “Hi” instead of your actual name, and you immediately lose interest. I want to see my name in an email; I want to see that you put in the effort to know a little bit more about me. I recently got an email from somebody trying to sell me something, but they went on my LinkedIn and included details about me … and I read that whole email just because they made it personalized to me. Now granted, we’re running businesses and we cannot have personalized one-to-one emails for everybody, but there are ways that you can customize text messages and emails as vaguely specific as you can.
Incorporating Incentives Into the Customer Journey
Malakian: What is your perspective in terms of the risks or the upside in incorporating incentives into the customer journey?
Bervis: My first question would be how often do you do customer care calls and what kind of surveys do you do on your existing customers because you need to understand your customers’ mindset. Are they coming to you to solve a problem? Are they coming to you because of your price point? Are they coming to you because you are the cheapest option; the most expensive option? And then what is going to make them become a customer of yours? So if they’re coming to you and the majority, let’s say 90%, of individuals who leave your cart or stop purchasing from you because of price point, then an incentive of a discount or a price reduction might be the best course of action just to be competitive with the market. However if you are the best in the industry…don’t just start lowering your prices because so and so has a one-to five ratio compared to your one-to-one ratio. That just [indicates] how pure your product is and how much better it’s going to be compared to somebody who’s mixing it with other items.
Knowing that customers are going to come to you because they know that you have the best quality product, the best results with their products, the cleanest products, you can definitely have a more premium product. Now let’s say there’s a lot of other individuals who have very similar [products] and make the same claims and you can see the testimonials and you can see that their market shares are going up, then I would definitely recommend maybe bring down the price. But when it comes to individuals who are coming to you because they are looking for the best services [or] the best products, I wouldn’t necessarily say that giving a discount is going to be [an] incentive to them. I would definitely say maybe exploring and giving a couple goodies away to them would be great and trying to build that relationship.
Tools to Track & Recover Abandoned Carts
Malakian: What are some of the tools in your team’s arsenal to track and recover
abandoned carts?
Bervis: Retargeting ads on Facebook and Instagram. You have that customer’s information from the abandoned cart — you have their email, their address, their name. You can go ahead and definitely start using that or have your pixels on your website to retarget those individuals.
Cart abandonment emails, Facebook, WhatsApp Messenger are great for certain businesses. Especially in Latin America, WhatsApp is going to be a big game changer to have on your website. I don’t know why the U.S. does not use WhatsApp or texting options for businesses. If I could text a business, it would be game over for Gen Z and millennials. ‘Oh I don’t actually have to pick up the phone and call this business? I can just text a representative? Amazing!’ Latin America does that a lot where they’ll help you out through a text message, sometimes even audio messages, and then they’ll send you a checkout link so that you can just securely purchase away from WhatsApp.
Obviously we have a lot of custom tools built into our company. We have call centers located all around the world…we have call reps all around the world from Ireland to Romania. We don’t use any crazy tools out there. Primarily what we do is we integrate with the shopping cart itself so that the shopping cart can give us accurate data in real time. We are not a big fan of [sending an] Excel sheet of everything that was abandoned. That’s too late; that customer moved on, they purchased something else. For us it’s how quickly can we move on this. I would say that’s one of our best action items … we have a great system in place and great training.
We’re one of the best in the industry when it comes to recovering those abandoned cards at around 22% right now. Depending on the product, that number sometimes will vary a little bit higher or slightly lower but that’s pretty much our company average.
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