Imagine dedicating your valuable time to browsing an online store, carefully selecting products, and adding them to your cart. You’re seconds away from completing a purchase, but then you hit an obstacle that stalls your progress. Your checkout process has timed out, the card has been reset, you’ve been asked to create an account to complete the purchase, or your preferred payment method isn’t even an option. Frustration mounts, your enthusiasm for buying wanes – and you’re exiting the site without a purchase being made.
Unfortunately, this is the reality for many commerce retailers. At a time when businesses are keeping a keen eye on cost efficiency, low conversion rates are stealthy profit killers. An estimated $260 billion has been lost to cart abandonment over the last decade, highlighting the enormous impact of a sub-par shopping experience. Shockingly, around 70 percent of shoppers who initiate a purchase abandon their carts. Those losses quickly stack up, causing retailers to lose out on thousands of dollars in missed sales opportunities.
So, what’s going wrong? Simply attributing these issues to a volatile economy or shrinking attention spans isn’t enough. Modern customers demand convenience, but what constitutes convenience in today’s commerce landscape?
Maximizing revenue through a better checkout experience
We recently partnered with Boston Consulting Group (BCG) for a comprehensive analysis of more than 220,000 commerce sites and more than 1 billion data points to examine the key drivers of the conversion process in which online shoppers become online buyers. The study found that although many particular factors affect conversion rates, they fall into two broad categories: factors that are fundamental to the store or type of business (and therefore there is less flexibility for sellers to change or control); and factors that can be improved, like an optimized checkout experience.
Checkout process optimization is the strategy a retailer uses to improve their online store’s conversion rate. The goal is to minimize distractions (such as multiple pop-ups or slow load times) and reinforce trust throughout the checkout flow. Understanding this journey clearly enough and fixing the process can help lead every shopper one step closer to a purchase confirmation email and away from an abandoned cart.
For example, one-click checkout is a fuss-free option that can improve conversion rates, simply by eliminating cumbersome steps when making a purchase. Shoppers only need to enter their details once on the site and the payment processor stores their name, email, and shipping address. So the next time a shopper visits the same site, they can complete the checkout with one click instead of navigating to a separate payment screen, making the process so much easier and faster. Other successful checkout optimization tips include:
- Allowing guest checkout enabling shoppers to complete their purchase without entering unnecessary details, such as their birthdate or password.
- Providing multiple payment and shipping options. Online shoppers want to be instantly gratified with a purchase and payment systems can often get in the way or cumbersome processes (like having to enter long card numbers several times) can be replaced with digital wallet options, such as ApplePay or ‘buy now, pay later’, such as Shop Pay installments.
- Mobile-friendly design. The increasing accessibility of mobile devices and smartphone technology means that your commerce site has to be optimized for browsing and purchasing on the go. This includes elements such as a mobile responsive design, faster loading times, and finger-friendly buttons with clear actions, such as ‘add to cart’ and ‘checkout’.
A new way to check out
As technology continues to evolve, digital commerce capabilities will need to be grounded to customer needs through deep levels of personalization. Checkout has always been core to Shopify’s platform developments; recent data from a Big 3 global consulting firm confirms that Shopify Checkout has a 15% higher conversion rate on average compared to other leading commerce platforms. We’re constantly looking for ways to help merchants automate mundane tasks so they can get on with building and scaling their businesses.
The bigger our merchants get, the more complex their checkout requirements become. In our latest Summer ‘23 Editions showcase of our latest products and innovations, we introduced 17 new APIs and updates to customize and create the best checkout experience for your business. For example, apps that can now validate, suggest changes to and correct a buyer’s address to ensure order delivery and avoid address correction fees.
What was possibly a technology that could only be managed by the hands of a few, has now become more democratized in online commerce through intuitive platform integrations. Today, most businesses, whether large or small, have the option of leveraging any of a multitude of all-in-one commerce platforms instead of developing everything in-house. As a result, sellers can concentrate on what they know best—the product, brand, and marketing—and rely on the technology provider to keep the engine up to date.
While your checkout process is not the sole factor for customer conversion, it is often an underestimated aspect of sales success. Checkout optimization is certainly not a one-time-only exercise, it requires frequent refinement and testing. But with a myriad of tools available to merchants, building a frictionless checkout experience has become so much simpler, enabling businesses to quickly identify issues in shopping journeys and bridge the gap between customer acquisition and abandonment.
Bharati Balakrishnan is Country Head & Director, Shopify India & SEA.
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