Each year, thousands of eCommerce and retail folks shuffle through the EXPO halls and attend the panel discussions of the Shop.org Annual Summit, one of the best retail conventions of the year. With over 4,000 attendees, 2011 was possibly the biggest Summit to date. The content at Shop.org summit is always packed with great practical tips, advice and the opportunity to network with experts from different fields. You can see a summary of this year’s event, including many of the presentations here.
And after passing out around 500 mini-shopping carts to our booth visitors, watching over 350 people squeeze in to attend The Science of Shopping Cart Optimization panel, and handing over $1,000 for the recovery of our abandoned gold mini-shopping cart, there’s no doubt that it was a big event for us at SeeWhy!
For starters, our very own Charles Nicholls, founder and CSO, made top news on the Shop.org blog with new research on shopping cart abandonment he presented to a full house during The Science of Shopping Cart Optimization panel on Tuesday the 13th. The SeeWhy Conversion Academy research team analyzed more than 600,000 individuals and 250,000 transactions in the largest study of its kind. Charles said “We traditionally think of shopping cart abandonment as being a bad thing. We now know that this is not true. For many buyers, and for many types of purchases, it is an integral part of the buying process.”
There are clear pros and cons of selling on Amazon. The Harry Potter franchise of e-books has recognized this and will not be depending on Amazon. Author JK Rowling has teamed up with Sony to launch a direct outlet, called PotterMore.
If you’re in the ecommerce business, and have ambition, then perhaps like JK Rowling, you shouldn’t sell on Amazon. But if your ecommerce business is funding your lifestyle, and you have no great ambition to change the world, then Amazon could be an important channel for you.
This distinction is important: It’s essentially asking the age-old question about your business, ‘Who do you want to be when you grow up?’ If your ambition is large, then Amazon is not for you. If you merely want to make enough money to pay the bills each month, then it could be good; but go into it with your eyes open because you’re hitching a ride on the back of a 90-pound gorilla.
Amazon’s strategy is to focus on three core values: selection, price and convenience. It strives to offer the widest possible selection, at the best price, with the easiest repeat shopping experience. Other merchants fit into this strategy only so far as they help Amazon to offer a wider selection of products.
Every customer on Amazon has registered; you can’t buy without first registering. It views the merchant almost as an affiliate — a source of new customers — based on product selection. So a search by a new visitor for a product that Amazon doesn’t sell — which results in a sale through the merchant — means that Amazon has acquired a new customer. But having captured the customer, Amazon’s model is to drive to repeat sales, and it will relentlessly sell the whole range of its products, not yours. (…)
The shopping cart abandonment rate has increased to 75% in the first 6 months of 2011. The rate, which averaged 71% for 2010, measures the proportion of online shopping carts that are started, and then abandoned.
Normal seasonal trends have the rate decreasing in the first half of the year, declining further over the summer months, then spiking in anticipation of holiday promotions being rolled out.
Once the holiday promotions are widely available, the rate declines again as shoppers make their holiday purchases online in volume.
Causes of the increase
There continues to be considerable economic uncertainty, and while ecommerce is faring better than many sectors, there’s no doubt that many consumers are cautious in their approach and are looking for the ecommerce channel to reduce costs. While convenience still drives many purchases, price sensitivity is increasingly playing a role, leading consumers to research purchases more.
Increasing customer sophistication
A recent Forrester study concluded that 89% of consumers had abandoned at least one shopping cart. Cart abandoners are more experienced and have been using the internet longer, and spend more online than consumers that don’t abandon. As ecommerce has become a mainstream activity of many consumers, so too has the general level of sophistication, with the consequence that many consumers will routinely comparison shop for the best price. The Forrester study showed that 27% of abandoners had abandoned a shopping cart in order to comparison shop on other sites.
Mobile devices pushing up the abandonment rate
Ecommerce purchases on mobile devices are forecast to be 3% of the overall online commerce market in 2011; however the abandonment rate on mobile devices is significantly higher than on tablets or PCs. While the overall impact of mobile shopping is currently small, it is becoming a factor that we will see more of going forward.
There is a massive need to share results and best practices, since this is still an area which is not widely understood. As such, I welcome all research into shopping cart abandonment and recovery emails.
So it was with some eager anticipation that I read Epsilon’s Abandoned shopping cart email strategies report. Unfortunately, when analyzing their results for the best time to send shopping cart recovery emails, Epsilon confused common practice with best practice:
“Typically 48 to 72 hours is optimal for abandoned shopping cart emails; anything sooner may seem too intrusive. Follow-up emails beyond the three-day mark may be too late to convert a potential buyer.”
This is pure speculation – in fact Epsilon’s own research doesn’t support this. What the research shows is that there is a distribution on send times for abandoned shopping cart emails ranging from the same day to more than a week. Most retailers who send abandoned shopping cart emails do so between 48 and 72 hours.
While this is the most common send time, it doesn’t make it the best practice. Best practice is a term often mis-used, so here is an example of what I mean:
“Just because lemmings are jumping off a cliff, it doesn’t mean that we should all do the same.”
Let me clearly state that sending a real time shopping cart abandonment email is ‘best practice.’
In this case, best practice is based on multiple independent studies including one from Forrester, two separate MIT studies and a Marketing Experiments test. Each of these studies have concluded that real time responses work better.
SeeWhy, using our A/B testing module, has shown on multiple tests for customers that the same email will perform significantly better when sent in real time. Open rates, click-throughs and conversion rates are all higher when shopping cart abandonment emails are sent in real time. (…)
There is a very strong link between website conversions and email. So in this blog we’re going to look at 4 simple techniques to increase email address capture: more email addresses captured will enable you to increase your website conversion rate.
We recently published a study showing that once traffic has gotten as far as the shopping cart email was the largest source of ecommerce conversions, ranking above a direct entry and search. This is a useful reminder that the majority of sales come from people you already know, and who already know you.
This shouldn’t be a surprise, since we know that existing customers and prospects are much more likely to purchase than ‘cold’ leads. So it’s obvious that email is going to nudge and prompt them back to buy.
But traffic sources don’t work in isolation. We need to consider how different traffic sources build towards an eventual conversion, triggered more often than not, by an email.
We know that it may take many visits to achieve a conversion, not a single visit. New traffic may not lead directly to a sale, but if it leads to a micro-conversion, such as a newsletter sign up, registration or social login, then this is very valuable. So perhaps we should be looking at search and social as a stepping stone, beginning to build a relationship, which ultimately will probably only turn into a sale after a sequence of touches.
In the interest of achieving more conversions, here is a list of the top four techniques of capturing more email addresses on an ecommerce site.
1. Incentivized Newsletter Sign Up
Given the importance of email in converting traffic, it’s worth considering giving your newsletter sign up more prominence. On most ecommerce sites, it is buried well below the fold, often in the footer. (…)