Avoid shopping cart abandonment

Although e-commerce sales accounted for more than $340 billion in 2015, a recent Baymard Institute study revealed that about 69 percent of online shopping carts were still left abandoned.

Why so many unfulfilled digital sales?

"Shopping online is like driving and following directions. The more twists and turns that exist (i.e. click-throughs, forms, fields, questions), the more likely the 'driver' will not reach the destination, or at least not quickly," Dan Leberman, VP, PayPal's (NASDAQ:PYPL) North American online small & medium business unit, told FierceRetail in an interview. "In other words, cart abandonment happens when consumers have steps to complete, and they take time to reconsider their purchase."

According to Leberman, $4 trillion of merchandise was left abandoned in online shopping carts in 2015 alone—the largest amount of cart abandonment even seen. In addition, he states that research indicates that 63 percent of merchandise in abandoned carts (or $2.52 trillion) is a recoverable sale for merchants, and three-quarters of surveyed shoppers who abandon carts plan on returning to the website at a later date to complete their purchase.

Leberman has three tips for online retailers to help turn those abandonments into purchases. First, allow customers to easily and securely store payment information when they want to make a purchase. "Using digital wallets accessed through username and password can be dramatically easier than using card information for many customers," he said. "Your business can easily install wallets on your web-checkout and start reaping the benefits by working with companies such as PayPal, whose wallet presents a 70 percent increased conversion rate compared to basic checkouts," he says.

Second, consider offering financing options and promotions (such as free return shipping) on the e-commerce homepage throughout the checkout process.

"Credit can be particularly powerful," said Leberman. Small businesses that advertised PayPal Credit experienced increased sales of 18 percent. Other incentives that can increase conversion rates include time-bound discounts and free shipping.

Third, merchants should "think outside the website" and enable shoppers to purchase where and then they want. This means making sure the e-commerce site is mobile- and tablet-friendly and perhaps enabling cloud-storage of online cards for customers who log into the site.

"Merchants can create unique customer log-ins if desired, or you can work with partners that enable something called 'unified log-in' so that customers don't have to create accounts. Facebook Connect, PayPal, Google, Amazon and many others can provide these unified log-in services. Then when customers 'log-in' or stayed logged in, they can access their carts that they created on one device (e.g. computer) and complete the transaction on any other device (e.g. cell phone or tablet)," said Leberman.

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