How to Reduce Cart Abandonment with Smart Discount Rules

Cart abandonment on e-commerce sites usually falls between 60% and 80% of initiated purchases and is explained by various factors influencing buyers' decisions. Most of these are unrelated to price as many shoppers fail to reach the end of the checkout process and exit due to unexpected additional expenses, the necessity to create an account, or lack of interest. However, the way discounts are displayed affects cart abandonment throughout the decision-making process, primarily for price-sensitive buyers.

Address the most common source of unexpected additional costs first

Additional costs are the most frequent reason for cart abandonment, and their impact dominates over price-related causes. In most cases, they are revealed too late in the purchase flow, frustrating buyers and pushing them away. Thus, the most efficient way to reduce cart abandonment is to display the conditions for obtaining a discount or removing extra charges (such as shipping costs) upfront. Checkout abandonment statistics reveal that this method is more effective than any other known to date.

Make the Conditions for Obtaining a Discount Visible at All Times

A time-sensitive or quantity-limited offer that becomes visible only at the end of the purchase flow is unlikely to prompt any action from the customer. This is especially true for cart abandonment. Even if a purchaser leaves the website with the intention of returning after a while, they will have to start the process anew from the beginning. The solution is to display a progress bar showing the amount of money spent at the current moment and the size of the upcoming discount at the point of decision-making. This allows the customer to see the potential benefits without leaving the familiar environment of the shopping cart.

Do Not Overuse Exit-Intent Pop-up Discounts

Using a pop-up window offering additional benefits when the purchaser moves to leave the site is an effective way to reduce cart abandonment. However, it should be used with caution since it may condition buyers to wait for a pop-up before making any purchase. If a customer returns to the website with the intent to buy something new, they will be prompted to wait before purchasing rather than proceeding to checkout immediately. As a result, the profitability of such a pop-up is significantly reduced, and the value of the discount should be close to zero.

Apply Different Rules Based on Why a Visitor Decided Against Buying

Not every abandoned cart is due to an unexpected additional expense, and some may have little to do with the price. Thus, applying the same rules to carts abandoned halfway through the payment process is meaningless, as the customer has already lost interest in the item. In contrast, the cart abandonment at the stage of selecting the delivery method with an additional charge as the reason for leaving can be prevented by displaying the discount threshold. In other words, different reasons for abandonment require different approaches, and generalizing the discount rules will fail to consider many details.

Take Into Account Not Only Discounted Sales but Actual Profitability

A promotional email sent to a customer abandoning a cart may encourage them to return to the site, but it may also reduce the company's profitability. The effectiveness of a specific discount method can be measured by calculating the profitability of every recovered purchase based on the size of the discount. If a particular rule only results in losses or minimal profit, it should be reviewed in favor of alternative options.

Discount Hub — Bulk & Cart Sale is a Shopify application that utilizes the abovementioned rules and offers the possibility to create discounts based on a customer's behavior. In particular, it displays the progress bar for applying thresholds-based discounts in the cart, helping reduce abandonment for price-sensitive buyers. It can be found on the Shopify App Store, and more information about its features is available on our Shopify Apps page.