Basket abandonment is a complex – and perennial – concern for any business that processes customer transactions online, with implications that extend across operations, sales and customer relationship management. More than 70% of online shopping baskets are abandoned before purchases are completed, translating into potential lost revenue and missed opportunities for businesses. While several factors can contribute to a customer's decision to abandon their basket, the reason often rests within a business's control.

By understanding the root causes of basket abandonment and adopting proactive measures, businesses can improve their online sales processes. This article explains basket abandonment in detail, including the reasons behind it, insights it can provide about business operations and pragmatic approaches to reduce its occurrence.

What's in this article?

• What is basket abandonment?
  
• Why does basket abandonment happen?
  
• How to reduce basket abandonment: 11 tactics to know about
  
• How Stripe can help
  

What is basket abandonment?

Basket abandonment is when online shoppers add items to their virtual shopping baskets but then leave the website or app without completing the purchase. E-commerce businesses often monitor basket abandonment as an indicator of potential issues within the buying process, from website functionality to customer hesitation or decision-making barriers. That said, basket abandonment isn't an issue that is exclusive to e-commerce businesses: if your business converts new customers and completes transactions online, basket abandonment is probably a top concern.

Why does basket abandonment happen?

Basket abandonment can be tied to specific elements in the online shopping journey. To reduce abandonment rates effectively, businesses must first understand these underlying causes. Here's a more detailed look at what can lead to basket abandonment:

• Unexpected costs
  Shoppers often abandon baskets when they encounter unanticipated fees at checkout. This includes delivery fees, taxes and other added costs. Businesses can combat this by providing transparent pricing early on in the shopping process or by offering promotions that offset these fees.

• Complicated checkout process
  A checkout process with multiple steps or unnecessary fields can deter potential customers. Streamlining this process, possibly through a guest checkout option or by having fewer form fields, can help reduce friction.

• Account creation requirements
  Some shoppers prefer not to create an account for a one-off purchase. Offering your customers a guest checkout option, or simplifying the registration process, can help to keep those customers on the path to purchase.

• Security concerns
  Shoppers sometimes abandon baskets if they don't trust the payment process fully. Using reputable payment gateways, displaying security badges and providing clear information about data protection measures can help to build trust.

• Website errors or slow loading times
  Technical issues can interrupt a purchase. Monitoring site performance on a regular basis and addressing any glitches promptly are key to creating a smooth customer experience.

• Ambiguous return policies
  Unclear return or refund policies can make customers hesitant. Creating clear and favourable return policies (and displaying them prominently) can instil greater confidence in potential buyers.

• Out-of-stock items
  Only discovering that an item is unavailable at the final stages of checkout can be frustrating for customers. Accurate inventory tracking and updating product availability promptly can reduce these occurrences.

• Comparison shopping
  Some customers add items to their basket as part of their research or while they are comparison shopping, and may not have the immediate intent to buy. Retargeting strategies, including email reminders or personalised offers, can recapture this audience segment.

• Distractions
  Online shoppers face numerous distractions, from other devices to real-world interruptions. When used judiciously, reminder emails or push notifications can bring customers back to finalise their purchase.

How to reduce basket abandonment: 11 tactics to know about

Understanding the reasons behind basket abandonment offers businesses the opportunity to improve their online shopping experience and address the barriers that customers face during their purchase journey directly. Addressing each potential pitfall in a systematic way can lead to higher conversion rates and increased sales. Here are 11 tactics that can make a difference:

1. Transparent pricing

Transparent pricing is important for establishing trust with potential customers. One common customer grievance is encountering unexpected costs at the final stages of checkout. To address this, businesses should make an effort to display all associated costs early on in the shopping process. This not only includes the product price, but also additional costs such as delivery, taxes and any other fees. Additionally, integrating tools such as a delivery calculator directly into product pages or the shopping basket can provide clarity and prevent potential surprises later on in the purchase process.

Practical takeaways:

• Display all costs early on in the shopping process to avoid last-minute surprises.
  
• Break down the costs for the customer, detailing the product price, delivery costs, taxes and any additional fees.
  
• Consider including a delivery calculator on product pages or in the basket itself.
  

2. Simplified checkout

An overly complicated or lengthy checkout process can deter even the most determined shoppers. By simplifying the checkout process and reducing the number of required steps, businesses can create a smoother, more user-friendly experience. Techniques such as offering auto-fill options can further reduce friction, minimising the number of steps that shoppers need to complete to make a purchase. Moreover, consistent A/B testing of various checkout flows allows businesses to understand and implement the processes that yield the highest conversion rates.

Practical takeaways:

• Reduce the number of steps in the checkout process.
  
• Offer auto-fill options where possible, decreasing the amount of manual input required from the shopper.
  
• To determine which process results in the highest conversion, A/B test checkout flows regularly.
  

3. Flexible payment options

Flexible payment options have become increasingly important. To cater to shoppers' diverse preferences, businesses should strive to accept a variety of payment methods, from standard options such as credit and debit cards to increasingly popular alternatives such as digital wallets. For premium products or services, offering payment plans or financing options can make purchases more attainable and less daunting for customers, leading to reduced basket abandonment.

Practical takeaways:

• Accept a range of payment methods.
  
• Offer payment plans or financing options for higher-priced items.
  

4. Trust-building measures

It's important to establish and maintain trust throughout the customer journey. Trust-building measures, such as prominently displaying security badges and certifications, can assure customers that their personal and financial data is safe. To amplify trust further, businesses should integrate customer reviews, ratings and testimonials for products, which reinforces the legitimacy and quality of their offerings.

Practical takeaways:

• Display clear security badges or certifications to assure customers their data is safe.
  
• Include customer reviews, ratings and testimonials for products, further validating the purchase decision.
  

5. Optimised website performance

Ever-growing customer expectations make optimised website performance a requirement. Slow loading times or glitches can quickly dissuade potential buyers. Therefore, businesses must monitor and optimise for both mobile and desktop interfaces on a regular basis. With many customers toggling between devices as they shop, businesses must ensure a responsive, consistent experience across all platforms.

Practical takeaways:

• Monitor site speed and optimise for both mobile and desktop on a regular basis.
  
• Ensure that the site is responsive across devices, recognising that customers may switch from one to another during their shopping experience.
  

6. Clear return, refund and cancellation policies

Clear return, refund and cancellation policies serve two purposes: they instil confidence in potential buyers and clarify the steps that customers should take if they're not satisfied with their purchase or service. By displaying these policies in a prominent place, especially during the checkout process, businesses can relieve concerns related to post-purchase regret. Tactics such as offering prepaid return labels or promoting free returns can further improve purchase completion.

For subscription-based businesses, marketplaces and platforms, this means creating easy ways for customers to change what type of subscription they have, or pause or cancel their subscription. While it might seem counterintuitive to reduce basket abandonment by making it easier for existing customers to leave, trying to stop customers from ending their relationship with your brand leads to negative word-of-mouth and damage to the brand overall – and doesn't necessarily stop them from leaving.

Practical takeaways:

• Display policies prominently during the checkout process, preferably with quick links to them.
  
• Offer prepaid return labels or free returns as an added incentive.
  
• Make it easy for customers to change their subscription tier or cancel altogether using a self-service portal.
  

7. Inventory management

Effective inventory management is a behind-the-scenes factor that significantly affects basket abandonment rates. It's frustrating for a shopper to spend time navigating the purchase process, only to discover at the last moment that an item is out of stock. Real-time inventory tracking systems can mitigate such issues. Moreover, back-in-stock notifications can retain potential buyers, signalling to them when a desired product becomes available again.

Practical takeaways:

• Implement real-time inventory tracking to avoid situations where a customer only learns that a desired item is out of stock in the later stages of the checkout process.
  
• Consider offering back-in-stock notifications for products that are currently unavailable.
  

8. Retargeting strategies

Retargeting strategies offer a way to re-engage potential customers who have abandoned their basket. Email campaigns, specifically targeting shoppers who've left items in their baskets, can serve as persuasive reminders. Additionally, dynamic ads on social media platforms, showcasing the exact products or services that the customer has added to their basket, can reignite interest and drive conversions.

Practical takeaways:

• Implement email campaigns which target customers who have abandoned their baskets, reminding them of their selections.
  
• Use dynamic ads on social media platforms which show the exact products that the customer had in their basket.
  

9. Engaging user experience

An engaging user experience is about more than aesthetics. While eye-catching visuals and detailed product descriptions play an important role, interactive elements – think 360-degree product views – can deepen engagement. Offering live chat support during business hours can also make a difference by providing customers with real-time solutions to queries or concerns that may otherwise lead to abandonment.

Practical takeaways:

• Offer live chat support during business hours to address any immediate questions or concerns.
  
• Use engaging visuals, detailed product descriptions and interactive elements, such as 360-degree product views, to hold customer interest.
  

10. Addressing comparison shopping

Comparison shopping is a nuanced challenge. As customers grow savvier and more resourceful, setting your brand apart is of paramount importance. This not only involves showcasing the brand's unique selling proposition, but also tangible actions such as offering price-match guarantees or loyalty programmes to reward repeat customers.

Practical takeaways:

• Position the brand's unique selling proposition in a prominent place, focusing on what sets the business apart from its competitors.
  
• Offer price-match guarantees or loyalty programmes for repeat customers.
  

11. Minimise distractions

A focused, streamlined checkout process with minimal distractions can reduce abandonment by limiting potential exit points. While promotional codes can be enticing, businesses should present them discreetly. A prominent code entry can lead to customers leaving the site in search of discounts, introducing the risk that they will not return to finalise their purchase.

Practical takeaways:

• Design the checkout process to be as clutter-free as possible, reducing potential exit points.
  
• If you are offering promotional codes, ensure that the code entry point is discreet to prevent customers from leaving the site to search for discounts.
  

Implementing these strategies requires ongoing analysis and iteration. Businesses should continue to gather data, seek feedback from customers and make adjustments based on observed behaviour patterns and changing market conditions. Addressing basket abandonment is an ongoing effort, but with a dedicated approach, businesses can make substantial improvements in their conversion rates.

How Stripe can help

Stripe offers solutions that address some of the core reasons for basket abandonment directly, making the checkout experience smoother for customers and potentially boosting conversion rates for businesses. Here are a few ways that Stripe can help businesses to reduce their risk of basket abandonments:

• Addressing unexpected costs
  A primary reason why people abandon baskets is because of unexpected costs that crop up during the checkout process. Stripe allows businesses to display all costs clearly, including delivery fees and taxes, right from the start. Businesses can also integrate promotions or discount codes directly into the Stripe Checkout interface, so customers know exactly what they're paying. In turn, this eliminates surprises that could lead to abandonment.

• Simplifying the checkout process
  A cumbersome checkout procedure can deter customers from completing their purchase. Stripe Checkout simplifies this process by offering a clean, single-page interface that only asks for the required information. This reduces the number of steps for customers, making it less likely that they will abandon their basket.

• Guest checkout and account creation
  For customers who don't want to create an account, Stripe provides the option for guest checkout. This is especially helpful for customers who are making a one-off purchase. For those who do choose to create an account, Stripe offers the ability to save their details for faster future purchases, making the process as straightforward as possible.

• Security measures
  Trust plays a significant role in online transactions. Stripe has robust security protocols, including PCI compliance and encryption. Businesses can also display Stripe's well-known security badge during checkout to ease customer concerns about data safety, thereby reducing the likelihood of basket abandonment due to security concerns.

• Website performance
  While Stripe can't control your website's speed or error rate directly, the Stripe API is designed for quick load times and low latency. It's also monitored continuously for performance, which helps to minimise disruptions during the payment process that might otherwise deter a customer from completing a purchase.

• Transparent return policies
  Although Stripe doesn't handle return policies for businesses, its customisable checkout interface provides an option to include a link to your return policy directly in the checkout pane. This gives customers an easy way to view your return policy before completing a purchase, which could address any concerns that may otherwise lead to basket abandonment.

• Inventory updates
  Stripe can be integrated with inventory management systems to reflect real-time product availability. This ensures that customers will not reach the last stage of checkout only to learn that an item is no longer available.

• Retargeting and reminders
  Stripe can work in tandem with other marketing solutions to facilitate retargeting strategies, such as email reminders or personalised offers. These can be particularly effective for customers who use their basket for research or comparison shopping.

• Minimising distractions
  While nothing can eliminate distractions entirely, Stripe's accelerated checkout feature allows returning customers to bypass much of the checkout process, making it easier for them to complete their purchase even if they are interrupted partway through.

Stripe's comprehensive suite of features helps to resolve many of the underlying issues that contribute to basket abandonment. Implementing Stripe's payment solutions means that businesses can create a smoother, more inviting checkout experience that encourages more completed purchases.

To learn more about creating an optimised checkout and how Stripe helps businesses to combat basket abandonment, go here.