Retailers losing out on £18bn each year through ‘Surf and Turf’ online shopping trend
17 April 2018 | 2472 views | 0
Source: Barclays Bank
UK retailers are losing out on more than £18bn in potential sales each year, as British shoppers have made a habit of website window-shopping, adding items to their online basket but ‘dropping out’ of the purchase before buying.
New research released today by Barclaycard, which processes nearly half of the nation’s credit and debit card transactions, reveals that while UK shoppers each abandon an online basket worth an average of £29.37 every month, many vendors are also missing the data or insights they need to tackle the online conversion challenge.
The study found shoppers are more fickle when buying online with 41 per cent having abandoned a transaction at a virtual check-out in the last year, compared to 24 per cent who have walked away from a purchase in-store.
Yet, despite a clear opportunity to engage online consumers to help combat the ‘surf and turf’ trend, six in ten retailers (59 per cent) are unaware of the average buyer drop-out rate on their website and just 27 per cent analyse the browsing behaviour of shoppers who abandon their baskets. A further 45 per cent are also unable to pinpoint lost sales by gender and 41 per cent by age group.
This knowledge gap is also evident when it comes to identifying specific shopper behaviours online. Three in ten merchants (31 per cent) struggle to name the month when their website sees the highest level of shopping basket abandonment, while 37 per cent are unable to identify the time of day when drop-outs peak.
The UK’s ‘most abandoned’ items online
The research also highlights the most commonly-abandoned items driving the ‘surf and turf’ online trend. Brits are most likely to have abandoned women’s clothing (29 per cent), men’s clothing (26 per cent) and entertainment items (26 per cent). The items most frequently ‘window shopped and dropped’ online are:
1. Women's knitwear
2. Leather goods, such as wallets
3. Women's lingerie & hosiery
6. Women's sportswear
7. Women's skirts
9. Men's trousers / jeans
10. Women's tops & shirts
Taken together, these items could be said to represent the UK’s ‘most abandoned’ online shopping basket.
Retailer routes to drive online conversion
The most popular tactics retailers use to tackle basket abandonment are automated email reminders (30 per cent) followed by a shopping basket ‘expiry period’ (19 per cent) - which a further three in ten (29 per cent) have plans to introduce in the future. For those that have taken this step, the average expiry period is 66 hours (2.8 days).
Barclaycard’s Smartpay gateway - a service merchants can use to capture ecommerce payments - provides retailers with rich data and insight into customer behaviour to help tackle the online conversion challenge. By capturing payments data, Smartpay provides retailers with a single view of their customer’s purchasing behaviour across all sales channels, presenting a significant revenue opportunity for merchants of all sizes.
Online basket abandonment: five key facts
• 8pm-10pm and 6pm-8pm are the peak times for online shopper drop-out.
• Retailers identify millennial shoppers (aged 25-34) as the most indecisive online, followed by 18-24-year-olds.
• December is the month with the highest level of online basket abandonment, followed by November and January, as shoppers browse Christmas present ideas and the Black Friday and January sales.
• Of those retailers who capture demographic data, two in five (39 per cent) say women are more likely to abandon their online shopping basket, versus one in five (19 per cent) who say men do - while two in five (42 per cent) think men and women are equally indecisive.
• 17 per cent of shoppers who abandon items online do so because they like to ‘window shop’ with no intention to buy - and more than one in ten (12 per cent) put items in an online basket to hold on to them so they don’t sell out.
Clare Bailey, Independent Retail Expert commented:
“It is so important that retailers not only invest in marketing to drive footfall to their websites, but also in their payment process to ensure that the online shopping experience is as seamless and hassle-free as possible. In the same way that consumers can lose interest in a purchase when buying in-store due to long queues, they are also put off by confusing and long check-out processes online. As such, retailers don’t want to waste their efforts in helping customers get items into the basket only to fall at the final hurdle when customers drop out because of problems at the check-out.”
George Allardice, Head of Strategy, Barclaycard Payment Solutions commented:
“Online basket abandonment rates are a perennial problem for online retailers, but as consumers increasingly shop via retailer websites, it’s becoming ever more important that merchants are equipped to combat this challenge. There are many ways retailers can convert online interest into sales - whether this is reminder emails about items left in online baskets, reducing the steps required to check out online, or securely storing card details so shoppers don’t need to re-enter them every time they visit a site.
“These actions will be most effective if they are based on insights about shopper behaviour, but as our research shows, there’s currently a knowledge gap that could be holding businesses back. Data from payment gateways such as Barclaycard Smartpay helps retailers to identify ecommerce pain points and make important steps to boost online sales.”