Four Best Practices Illustrate How to Recover More Revenues from Shopping Cart Abandoners
Shopping cart abandonment is a persistent problem for all ecommerce merchants, yet surprisingly, only 16% of online merchants send shopping cart abandonment emails. This is even more surprising when you look at the amount of revenue these campaigns drive.
New Conversion Academy research shows that best in class shopping cart recovery emails generate $17.90 in revenue per email sent. On average, 20.8% of abandoners come back and buy. And when they do, they spend 55% more on average than purchasers who bought without abandoning.
That’s a different order of magnitude from a typical batch-based email campaign. A recent Experian CheetahMail report showed that regular bulk campaigns generated on average $0.17 for every email sent, while loyalty campaigns generated $0.18. Transaction rates were 0.07% and 0.09%, respectively.
This illustrates that loyalty emails are better revenue generators than regular bulk campaigns, but they are dwarfed by shopping cart abandonment emails. Compare the $17.80 per email for shopping cart abandonment with $0.18 for loyalty campaigns, and you see what I mean: almost 100 times on average more effective in generating revenues. Some loyalty campaigns are more effective than the average. For example, an email announcing the arrival of a loyalty award generates on average $6.81 per email sent and has a conversion rate of 1.4%.
Of course, these campaigns are different in nature (triggered vs. sent in batch), but their objective is the same: retain customers. Shopping cart abandoners who are website visitors are especially worth retaining; they almost purchased and are your best prospects.
However, not all shopping cart recovery campaigns are equal. For example, a typical shopping cart abandonment follow-up campaign consisting of a single email sent 24 hours after the abandonment will recover between 3% and 5% of the abandoners that were remarketed. So what makes the difference between a campaign that recovers 3% to 5% and one that recovers 20.8%?
There is a formula for getting this better performance. Top performing shopping cart abandonment emails usually have the following characteristics:
Best practice is to email immediately. Multiple studies have shown that ecommerce leads go cold very fast. An MIT study showed that 90% of leads go cold within the first hour. Follow up 24 hours later and 90% of the opportunity has gone.
The two primary reasons why visitors abandon shopping carts are price and timing. It’s important that your remarketing campaign addresses the reasons for abandonment. If you take an overly aggressive sales approach, you can harm sales; visitors that were still considering a purchase need high quality service and support throughout their decision process. Think of a remarketing campaign as a sequence of gentle nudges that support your brand values.
Many shopping cart recovery emails under-perform because they look either like generic promotional emails or robotic system-generated messages.
Done well, remarketing emails should be incredibly relevant, true 1-to-1 marketing. They leverage both the detail of what the visitor was viewing only minutes previously and connect with the emotion of a purchase.
Here’s an example:
Triggered directly by the visitor’s website activity, optimized examples feature details about the specific item abandoned in an engaging way, designed to get the reader to return to the shopping cart process.
Many abandoners are simply not yet ready to buy, so a single email will never be as effective as a sequence of emails that nudge the customer—aiming to contact the customer at a point where they have had more time to consider the purchase. Some remarketing campaigns use as many as six remarketing emails, but the most common is a sequence of three, typically timed to follow up as follows:
#2: 23 hours
#3: 6 days and 23 hours
The reason for the odd-looking timing is simple: These types of campaigns benefit significantly from send-time optimization. Let’s assume that Jane abandons her shopping cart at 10:17 a.m. Eastern time. A typical bulk campaign would batch together all abandoners and send the data to an email engine so that all abandoners for the previous 24 hours could be emailed. The email goes out at 6:00 p.m. the next evening.
Unfortunately, Jane likes to shop online during her morning coffee break and doesn’t read the abandonment email until two days after she abandoned.
Send-time optimization recognizes that shoppers are creatures of habit and triggers follow-up emails in synch with the times that these visitors originally abandoned. This typically gives a lift over bulk sent campaigns of between 25% – 35%.
Shopping cart abandonment emails represent a significant opportunity for online retailers. For best in class campaigns, each email sent will probably be your most profitable campaign, generating up to 100 times the return that you would expect from a regular bulk mailing. Of course, these campaigns are reliant on email address capture, which is a subject we’ll look at in our next blog.
Author: Charles Nicholls
Charles Nicholls is founder and chief strategy officer of SeeWhy, web analytics visionary and author of Lessons Learned From The Top 1 Converting Websites. As a veteran of the analytics space, he has worked on strategy and projects for some of the world’s leading ecommerce companies, including Amazon, Ebay and many other organizations around the globe.