Increasing Revenue Utilizing Abandoned Cart Emails
Posted August 24, 2016 by Springboard in Digital Marketing, eCommerce Website, Email Marketing, Marketing Statistics, Marketing Strategy
Maybe you’re new to eCommerce. Maybe you’ve been in the game for awhile. Either way, one of the major initiatives that your online retail store should…no, NEEDS to undertake is increasing revenue utilizing Abandoned Cart Emails.
The Baymard Institute, a company focused on e-commerce usability and research, found that the average abandoned cart rate is over 68%. 68.63% to be exact. That is a ton of lost opportunity. If you aren’t addressing abandoned carts then you are losing out on additional revenue. Revenue that, technically was going to be yours, but for some reason or another the visitor decided to leave.
While there are a number of ways to address abandoned carts, we’re going to talk about Abandoned Cart Emails. What they are, why send them, and how to send them. It definitely isn’t an end all, be all type of solution but it IS another tool in your bag to capture additional revenue.
I’m sure I don’t have to explain what an Abandoned Cart Email is but I will anyways. Go visit an e-commerce store, add one of their products to your cart, and start to go through their checkout phase. Chances are, if you entered your email and then left, you’ll receive an Abandoned Cart Email.
Quite frankly, this can come in many flavors. You can use the baked in version included with your e-commerce platform. Your system will capture the visitors email at some point in the process of checkout and then automatically send an email pertaining to the products in their cart. Usually you’ll see two to three emails over the course of a few days trying to entice you to come back and finish your order.
For more advanced marketers, their visitors that abandoned will see more sophisticated emails and earlier email captures. One of the stores we own is on Big Commerce. The default classification of an Abandoned Cart as defined by Big Commerce is that once the user has submitted their shipping details. We started doing split tests of capturing and classifying abandoned carts once the visitor puts their email in. By redefining this, we’ve seen an incredible increase visitors that we funnel into abandoned cart emails.
So for numbers sake, lets make it easy. We’ll assume that, on a daily basis, your ecommerce store gets two orders and eight visitors abandoning their cart. With an average order of $100 (for easy math) your currently seeing $73,000 in annual revenue. Not bad. Lets make it better.
Take the eight abandoned carts and we’ll say that one of them converts each day because of the abandoned cart emails you send. To help entice the abandoned cart conversion, lets say you offer a 10% discount. This means you are able to convert 12.5% abandoned carts at an average order value of $90. What you’d be looking at is 365 new orders a year with an additional $32,850 in revenue – all because of abandoned cart emails.
Keep in mind that these numbers are somewhat low. Studies done by Business Insider have shown that 63% of abandoned carts can be recovered. That may be high for some stores but even at 30%, you’d be looking at over $78k in additional revenue. The point is to show you that the more effort you put into improving, testing, and implementing abandoned cart emails, the more your revenue has the potential for substantial growth.
So the numbers are great and all but how do you do it? How do you increase your abandoned cart recovery rate? So glad you asked! I’ll show you how we did it.
I already mentioned it but one of the first things we did was capture emails earlier in the process. Instead of waiting until shipping information was input, or email capture happened as the first step of guest checkouts.
Our abandoned cart emails are ran through Klaviyo. Using this tool, we broke our abandoned cart visitors into buckets – one that added a specific product to their cart and all the other into a more generalized abandoned cart flow. Klaviyo, and many other tools, allow us to build flows for each abandoned cart that we defined so that the visitor receives a series of emails. In our case, we had a flow that centered around visitors that added a certain product to their cart. The content we sent in emails helped show the value of the product, how to use the product, and why they should purchase the product. The other flow was generalized and captures all visitors that had anything in their cart aside from the product defined earlier. This flow also sent a series of emails pertaining to our products in general.
Each email was sent after a period of time from the instance that a visitor abandoned the cart. Over the course of a week, we send out four emails. Needless to say, compared to previous results, this process has proven to be an improvement over the default abandoned cart emails. We project, based off the data we’ve seen, that our abandon cart flows will capture an additional $1m plus in annual revenue. This goes to show that every ecommerce owner and manager needs to pay attention to abandoned carts. It could be one of the quickest ways to inject an additional revenue influx into your business.