Reducing basket abandonment
Todays internet consumers have got wise to finding the best deals. With less money to spend, they have become more search savvy to find what they want at a price they are happy to pay. But marketing expert Chris Gabriel says there is a lot retailers can do to improve online conversion rates
Today’s internet consumers have got wise to finding the best deals. With less money to spend, they have become more search savvy to find what they want at a price they are happy to pay. But marketing expert Chris Gabriel says there is a lot retailers can do to improve online conversion rates
With less money to spend, consumers have become more search savvy, according to Chris Gabriel, marketing and solutions director at systems integrator Logicalis UK. As a result, retailers are finding that online shopping baskets are being abandoned at an ever-increasing rate. The latest figures from analyst firm Forrester show that shopping cart abandonment has risen to a staggering 71% in 2011, creating a multi-billion pound issue for UK’s online retailers.
While tinkering with the checkout process and trying out different marketing strategies can help, Gabriel maintained that these can only going to provide short-term wins and small percentage reductions in abandonment. “A more effective solution is to discover why your customers are rejecting your products, and then act quickly on the findings,” he said. “By implementing a business intelligence solution, retailers can take a much more holistic view of the retail journey, bringing out more meaningful results that can be acted on instantly.”
Identifying internet retailing trends
By tapping in to the world of ‘big data,’ where a vast amount of internal and external information is available, Gabriel said retailers can review past trends to enable intelligent decisions to be made about the future, both from their customers and supply chain perspective.
“For example, a business intelligence dashboard can provide your business with a snapshot view of the key performance indicators of your whole web activity, including metrics such as average sales per customer, page views per visit and shopping cart abandonment rate,” he said. “It can also provide you with information about what products customers have been adding to their shopping carts, but did not buy. This opens up the immediate opportunity for targeted communications, such as emails to those who have opted to receive them when these items go on sale.
By linking customer demand with supply chain availability, Gabriel said retailers can analyse what online customers are buying against what is being supplied, whether the products required are being sourced quickly enough, and if the supply chain is operating efficiently enough.
“This is all about improving the customer experience above and beyond what shoppers find on the High Street,” he added. “Today, consumers want and expect retailers to refine and finesse the online shopping process by monitoring their visits and offering them appealing alternatives to what they are reviewing.”
Changing consumers’ minds online
The main advantage of a business intelligence (BI) system is the depth of information that can be obtained about customers, according to the Logicalis expert: “For example, a typical web analytics system will say how many pages have been viewed on a website, and which ones are most popular. With a BI system, this data can be combined with other sources such as your customer relationship management and accounts systems, to provide you with a more in-depth knowledge of your customers, therefore helping you to predict future behaviour. What’s more, instead of the usual weekly and daily reports, you can receive real time positioning as and when you need it.”
He added that BI also allows retailers to be more intuitive across the whole process of online shopping. “For instance, by linking to a temperature and weather feed, it becomes possible to change your products to suit the outdoor conditions,” Gabriel said. “So when it’s hot, your e-commerce front page displays barbecue products, or if it’s cold, it shows soups and winter warmers. Another input you could consider would be your competitors’ pricing, making it possible to dynamically adjust what you’re charging to just below your competitors.
“Overall, by doing everything in real time, it’s possible to act on abandonment and possibly turn the customer around before they have a chance to go elsewhere. A 2007 MIT study by Dr James Oldroyd showed that 90% of leads go cold within the first hour. Business intelligence allows you to react quickly, increasing the chances of convincing those who have abandoned their shopping carts to change their minds,” Gabriel concluded.