Cart abandonment culprit: High price items (Causes and Solutions)
Let’s face it. No one wants to spend a huge chunk of their money while shopping; they’d rather buy multiple items that have a cheaper price tag but with the same features.
High Price contributes to a large number of cart abandonment in the eCommerce world. As per the study by Worldpay, 36% of online shoppers were found to abandon their shopping carts ‘finding a better price elsewhere’ as the reason.
There are three major factors that cause overpriced products:
High Product Acquisition Cost
Your customer pays $20 for a scented candle but ultimately gets a bill of $30 by the time it reaches their front door.
What causes a price spike as much as 50% on a $20 product? Generally, it’s either:
- High Shipping Cost
In most cases, the shipping price is only disclosed after the customers proceed to the checkout button. Even if you’ve set an affordable price for the product, a ridiculous shipping cost will not make your product worth its value.
- Monopolistic Shipping Market
Not every nook and corner can be reached by your shipping company. In such locations, a monopolistic shipper is the only means to ship your customer’s product but if they set a high price for their services, your customers have to bear it in the end.
Sure, setting a high-profit margin is a great way to make sure your company is in good financial health. But are you selling a product that isn’t being sold by thousands of online sellers?
If the answer is no, setting a high-profit margin will negatively affect your business. All it takes for a customer to find a better price elsewhere is using a shop comparison website.
According to a research done by Shopify, ‘presented with unexpected costs’ was the cause behind 56% of cart abandonment.
Driving traffic to your website quickly can be done with appealing offers such as discounts and group deals. However, if it is a façade that’s hiding a couple of sneaky hidden costs such as insurance, shipping, VAT and so forth, the chances of your customer still agreeing to buy the product hits rock bottom.
Now that you know about the causes behind high prices, let’s look at how to tackle each one of them.
Using Offers to Reduce Cart Abandonment
Who doesn’t love getting appealing offers while shopping? It is no secret that customers are more satisfied with their purchase when provided with a savings offer.
Most organizations use offers only when they need to clear their stock. However, there are more ways you can use offers as a means to efficiently reduce cart abandonment.
Let’s go through each of them in detail:
Selling bulk products is a great way to get rid of stock that’s taking up space in your inventory. You can use group deals by including a variety of similar products while pricing them in a cheaper rate.
For instance, if your site sells cleaning products, you can attract customers by offering a bulk of cleaning liquid, micro-fiber cloth and dusting tool in a saving offer.
Location-Specific Free Shipping
It may not be possible to provide free shipping worldwide like big companies but you can still earn a small margin by providing free shipping around the area that your company is located.
When multiplied by economies of scale, providing free shipping to customers who live near your store’s area will be worth the reduced abandoned carts.
Coupon Codes, Vouchers and Cashback
These offers have become a market in itself in the realms of affiliate marketing. Especially cashback is a great way to retain customers because they are rewarded with cash every time a purchase is made through their referral.
During festive periods such as Thanksgiving, Christmas and so forth, offering discount vouchers as a way of helping your customers celebrate an occasion keeps both you and your site visitors happy.
Unless your site has the ability to sell at a large scale, using offers while suffering from low profit margin may not be worth the risk. However, if you can market your offers to a large number of potential customers, it can definitely help reduce cart abandonments significantly!
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