In the digital era, retailers know exactly how much revenue gets left on the shelf.
A survey of 6,000 global consumers by the Mobile Ecosystem Forum said 58% of people will start to make a purchase on mobile before abandoning that purchase before the end of the process. There are a variety of reasons why a consumer doesn’t always follow through, but shopping cart abandonment is a legitimate concern for the industry, the MEF’s Mobile Money Report said.
MEF said people think that they are asked for too much information or that the process of buying an item on a smartphone took way too long. Around 31% of people said the checkout process required sensitive information that they were not prepared to give. Technical and connectivity issues were cited as reasons why 22% and 21% of people did not complete the purchase, respectively. Only 20% of people said that they always complete the transaction.
>Source: Mobile Ecosystem Forum, Mobile Money Report
American shoppers are the ones most likely to abandon their virtual shopping cart. Around 66% of U.S. respondents said that they stopped the process before the end and never returned. This was elevated during the Black Friday-Cyber Monday weekend when 78.1% of purchases started on mobile were reportedly incomplete.
M-commerce experts have lamented ‘payment abandonment’ since the market began. They still do. Every day, mobile merchants miss out on significant revenue because shoppers fail to check out. Some people simply change their minds about a purchase. But many more find the payment process too complicated, time-consuming or intrusive to continue. To repeat, this is nothing new. But the problem endures.
The industry is well aware of the problem and is taking steps to address it, the report said. Theoretically, at least. Ecommerce shopping cart abandonment has been an issue for retailers for years. In 2014, shopping cart abandonment was possibly as high as 72% of all would-be purchases. A simple solution such as instant one-click ordering on a mobile shopping app such as Amazon can reduce the potential for lost revenue, although that fix is better suited for repeat customers.
Mobile wallets are another way to ease the customer into a final purchase decision with credit or debit details stored in the phone itself. A shopper could checkout with a PIN or biometric signature to complete the transaction, which would certainly speed up the process, said MEF. In addition, there is the “buy now, pay later” option—a financial transaction that is familiar to millions of people.
As more people have become comfortable with shopping online, impulse purchases have never been easier. At the same time, deciding to remove the item altogether or just look for something else on another website is equally as simple.
Business Insider recently reported that customers abandon purchases for a myriad of reasons that include but are not limited to the ones identified by the MEF report. Increased shipping costs, the need to create an account, a poor or onerous checkout experience and a lengthy delivery spread can all impact a customer’s decision to buy.
In 2014, over $4 trillion in merchandise was left abandoned in online shopping carts, reported Payments.com. Mobile abandonment rates exceeded desktop or tablets; 81% of mobile customers abandoned their carts compared to 61% on desktop and 71% on tablets.