Last Updated: April 2024
Do you measure the cart abandonment rate for your e-commerce store? If not, you should.
Cart abandonment is quite similar to going to a real store, like a product, and then coming back empty-handed. It has been one of the prevailing issues in the eCommerce world.
According to Statista, “75% of shoppers abandon their carts and leave a site without completing a purchase”.
Calculating the cart abandonment rate seems essential to know the issues with your e-commerce website so you can act accordingly.
Today, we’ll give you a quick insight into the basic concepts of cart conversion rate, cart abandonment rate, abandonment rate formula, and how every abandoned cart can be an opportunity.
In this post, we’ll walk you through:
- Cart conversion rate vs Cart abandonment rate
- What is the cart conversion and cart abandonment rate formula?
- Cart abandonment rate calculation with Shopping Behavior Report
- Ways to track shopping cart abandonment rate with Google Analytics
- Abandoned Cart = Opportunity
Cart Conversion Rate vs Cart Abandonment Rate
To better understand the concept of cart abandonment rate, you first need to be aware of your company’s cart conversion rate.
The cart conversion rate of a company indicates the total number of successful transactions after the initiation of the checkout process. The cart conversion rate is inversely proportional to the cart abandonment rate, as a higher conversion rate leads to a lower abandonment rate and vice versa.
On the other hand, the cart abandonment rate indicates the average number of carts that were abandoned before the final transaction.
Reasons that might lead to cart abandonment include high shipping costs, fewer payment options, bad product service, poor customer service, out-of-stock items, and inaccurate product descriptions.
Similarly, the checkout abandonment rate is yet another metric that indicates the number of carts that successfully proceeded to checkout but were left midway due to unforeseen circumstances.
Now, let’s have a look at the cart conversion and abandonment formulas:
What are the cart conversion rate and cart abandonment rate formulas?
Like other customer success metrics, the abandonment rate calculation is easy and doesn’t involve complex mathematical equations.
To find out the abandonment rate, you first need to find the cart conversion rate.
To calculate the cart conversion rate of your company, you need to divide the “number of successful purchases” by the “number of opened shopping carts”. Then, the product must be multiplied by 100, which would be your cart conversion rate. Now, to calculate your cart abandonment rate, you need to subtract “1” minus your “conversion rate”.
Example:
If you have over 1500 successful purchases and 3000 opened shopping carts, here’s how you can calculate the abandon rate:
Cart Abandonment Rate= 1-(Cart Conversion Rate)
Cart Abandonment Rate=[1-(1500/3000)]*100
Hence, the cart abandonment rate of your company is 50%.
Cart abandonment rate calculation with Shopping Behavior Report
An easy way to avoid complex calculations is by using Google analytics for the abandonment rate calculation. It helps in calculating and keeping track of the cart conversion and cart abandonment rates of your company. To check these metrics out you need to track the following navigation: conversion, eCommerce, Shopping behavior.
A shopping behavior report consists of a funnel that helps you track 5 major parameters:
- Total Visits: number of users who landed on your website.
- Product views: number of views a particular product received.
- Cart additions: the amount of time a product(s) spent on the “add to cart” section.
- Begin checkout: number of times ‘add to cart’ products went on for checkouts.
- Successful Transactions: number of times checkouts resulted in transactions.
With the help of the above-mentioned parameters, we can analyze our Shopping behavior report to determine our cart abandonment rate. Before moving to how you can calculate your abandon rate, you need to find out your cart conversion rate first.
The conversion rate is indicated by multiplying “successful cart to checkout percentage” by “successful checkout to transaction percentage”. Then you need to divide it by 100 to get the cart conversion rate. Similarly, the cart abandonment rate is calculated by subtracting “1” minus the “cart conversion rate”.
Example:
If your “successful cart to checkout percentage” is 35% and “successful checkout to transaction percentage” is 12%, then your cart abandonment rate would be:
Cart Abandonment Rate= [1- Cart Conversion Rate]
Cart Abandonment Rate= [1-(35%*12%)/100]
Hence, according to your shopping behavior report, your cart abandonment rate is 95.8%.
Ways to track shopping cart abandonment rate with “Google Analytics”
Despite the formula for calculating the abandonment rate being easy, sometimes automated results are just the solution you might be looking for. Google Analytics can be an effective tool that can work as an abandon rate calculator. It helps us create various funnels to understand user behavior and pain points.
Here’s how you can track your shopping cart abandonment statistics with the help of Google Analytics:
1. Create a new goal
A goal is created in Google Analytics to analyze the frequency with which the users indulge or complete a certain set of actions on your site. To create a goal, you can either choose existing templates or create a new template from scratch to better fit your needs.
On the homepage, go to the “admin” tab. Next, find the goal option under the “view” tab to create a new goal. For tracking your cart abandonment rate, you need to click on the predefined template, “checkout complete”.
2. Add details to the goal
In this step, you have to add details to your goal. Fill out destination details to your goal by providing the URL of each step that is involved in the checkout process. The “destination” option can be found under the “type” option in the goal-setup menu. After choosing the destination option, paste your destination URL in the “Begins with” drop-down list.
3. Add a funnel
It is the final step involved in creating a goal. In it, you create a funnel by adding a link to each procedure that leads to the transaction. Mostly, a checkout funnel consists of an add to the cart page, billing details page, and successful transaction page along with their links.
4. Discover cart abandonment reports
After successfully creating your goal, give it a set amount of time to gather relevant statistics. Once the statistics are in, head to the “conversion” tab, click on “eCommerce” and then select goals. The data collection for your goal would take around 24 hours.
Also, the “funnel visualization” under the conversion tab shows you a graph. It indicates under which funnel did the users churn out of the buying process. Once you have the data, you can analyze where the users drop out during the checkout process. It will help you determine your strengths and weaknesses. Hence, it would help you come up with better retention strategies.
Abandoned Cart is Opportunity
According to Statista, “In March 2021, almost 80 percent of online shopping orders were abandoned, i.e. not converted into a purchase. Automotive had the highest cart abandonment rates out of all measured categories with an 89.11 percent abandonment rate”. Just like a customer, cart abandonment is a pain point for many eCommerce businesses. It is a metric that indicates the number of customers who churned out before completing the checkout procedure.
However, you should not be disappointed. Cart abandonment rate is directly proportional to the overall customer journey. Therefore, once you know the particular pain points of your customers, your cart abandonments will decrease. To ensure it, make sure you follow all the steps mentioned in our guide and let us know if it worked for you!
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