Shopping cart abandonment is one of the significant issues that most online retailers experience. It is more like being stood up on a date that you had looked forward to. None of us wants to get our hopes dashed because somebody out of the blue got cold feet at the very last minute. The truth is that around 70% of online shopping carts are abandoned before the purchase is completed. This means that more than ⅔ of people shopping on your site, for whatever reason, decide not to go through with the purchase.
Basic Cart Abandonment Strategy
Many top marketers launch a Cart Abandonment Reminder to target undecided customers through email, push notification, display, or social media campaigns. This is done with the aim of winning back potentially lost purchases. It's important to ensure that your customers stay with you instead of going to a competitor. To boost the results, many marketers offer a discount to retarget customers. This strategy has been successful in recovering up to 30% of lost transactions.
While drafting your cart abandonment email and bragging to your boss about how awesome the KPIs are, your customers are waiting and calculating. Wait, what?
Many consumers are aware of companies' retargeting campaigns and are on the lookout for emails or ads on websites like Amazon or Facebook. They often abandon their cart in hopes of receiving a discount. Some may question the ethics of this tactic, but if there's a chance to save money, who wouldn't take it?
While offering discounts in cart reminders may seem like a good idea, it can lead to more abandoned carts and frequent discount usage, resulting in lost revenue. Instead, there are retargeting strategies that can increase the value of each incomplete order while maintaining high marketing KPIs and reducing reliance on coupons. Let's take a closer look at these strategies.
Modern, data-driven Cart Abandonment Strategy:
The best practice is to create a campaign chain instead of a single message. Start with a retargeting message that doesn’t involve the discount. If the customer won’t respond, implement strategies to include the discount without hurting the company’s profit:
1. Offer help first.
It’s important to remember that not all cart abandonment issues are because of the price. Some people might have legitimate questions about the quality, delivery, return policy, or something else. This means you need to first look at sending the user a message asking if you can address questions that they have. A good practice is to have a live chat on the site with an automated pop-up message. This way, people can ask their questions without having to abandon their site in the first place.
2. Propose similar items with different price ranges.
If email is one of your main retargeting channels, you could include product recommendations with items similar to the product in the basket. The point here is to show customers that there are various pricing options. For example - if you sell candles, the one they abandoned in their cart was $20, then you could show other candles that are offered on the site at different price levels, including $15 and $10. If you want to push them toward a particular product with a high margin, you could even offer a discount on a specific inventory item. If you do give them a discount, make it specific so you control what is being discounted.
3. Differentiate the message & make it sound natural.
A common error made by marketers is repeatedly sending the same retargeting ad. Such ads become monotonous and spammy without any discounts to attract customers. To ensure higher customer engagement, it's essential to mix up the campaign message with various variations and make it seem less automated and predictable. If executed correctly, the customer should believe that a customer representative noticed their incomplete order.
Although I'm familiar with the latest marketing strategies, I have to admit that I too have fallen prey to this trap. Whenever I download a resource or read an article from HubSpot, my Account Manager sends me an email asking if I need further assistance on the topic. They offer additional resources and even a personal meeting. It took me a while to realize that this was all part of an automated campaign chain designed to encourage me to purchase their solution.
4. Analyze your customers on an individual level.
If you want to go aggressively and add a discount, it’s worth further segmenting your target group by lifetime value. You have to ask yourself: Is this customer worth the discount? The reality is that some are extremely low value in comparison to other customers and therefore the discount might completely ruin your margins.
5. Segment based on the product in the basket.
You also have to consider the product inside the basket before you go offering up a discount. For example, if it’s a new item from a freshly launched collection, it’s likely in high demand, so there are more people interested in it. Discounting it, could hurt your brand and show your customers it’s not worth buying from your store at a full price. However, if the product is from old stock or has a high margin, then you can put up a lucrative offer on it. If you want to go even further to maximize results, check whether the cart value is above average - if the stake is high, then it might be worth discounting it a few bucks or offering free shipping.
6. Offer a bundle to up-sell.
If you’re going to offer a coupon, you can try to maximize the profit that the company makes on this particular transaction: instead of discounting a single product, try to up-sell and offer a discount on a set or bundle instead: “10% off if you add one more T-shirt to the order”
7. Retarget with a loyalty program.
This method has proven to be highly effective in letting customers know that they will be rewarded once they reach a certain level of purchasing, even if they don't receive an immediate discount. Instead of offering a percentage off right away, it is recommended to remind your customers of how close they are to receiving the VIP discount. This creates an incentive for them to complete purchases and earn monthly, quarterly, or random rewards as they continue to spend on your site.
Final Thoughts
It is important to avoid being too forceful with cart abandonment emails to customers, as this could unintentionally harm your abandonment rate. Instead, it is recommended to be more specific and analyze the individual aspects of both the carts and customers when retargeting. Utilizing marketing automation tools can assist with this process and help ensure that you are focusing on your bottom line while retargeting effectively. It is also wise to test different retargeting strategies and evaluate whether offering a coupon is worth the potential discount. Lastly, it is crucial to regularly monitor the abandonment rate to stay aware of any changes.
Having questions? Write an email to hello@vouchery.io with the subject ‘Consultation’ & we will get back to you to schedule a 1-hour free-of-charge consultation meeting or a call.
About the Author:
Ewelina is a Marketing Technology Entrepreneur with over 10 years of experience leveraging data to personalize customer journeys across multi-channel experiences. She has a passion for shaping consumer behavior through contextual, predictive, and personalized promotions and incentives that deliver value to both brands and customers.
Connect with Ewelina on LinkedIn.