Shipping costs affecting number of abandoned shopping carts

Order Management

Abandoned shopping carts are an unfortunate reality for eCommerce retailers. Sometimes, people just don’t want to follow through with an order they’ve initiated.

While this is often an unavoidable source of frustration for retailers, there will always be some factors that lead to a lost conversion that merchants can’t control. However, there are factors that will help reduce abandoned shopping carts that retailers can control and implement with a little bit of strategy.

One of these factors is shipping costs. Shipping is easily one of the biggest trade offs for consumers shopping online as it doesn’t provide the same instant gratification of making a purchase in-store and simply taking the item home that day. At the same time, shipping costs add more overall costs to the purchase, with some eCommerce retailers charging upwards of $10 for shipping and handling fees.

Retailers must consider their own shipping processes, particularly with regard to which shipping provider they partner with to deliver goods to customers. Merchants can enjoy significant savings in shipping costs by picking the right one. Retailers should consider the following when trying to decide which shipping provider is optimal:

1. Target market

Retailers will need to cover all of their bases effectively to reduce abandoned shopping carts. If they are only reaching a target market in a small geographic area, then they may consider making a special deal with a local third-party logistics company (3PL). Conversely, they may need to consider a regional shipping provider if they are looking to a target market internationally. Special considerations should be made to how much product is shipped to a region before deciding on the shipping provider.

Special considerations should be made to how much product is shipped to a region before deciding on the shipping provider.

“Additionally, retailers will have to review customs duties and support for different payment mechanisms (such as cash on delivery) when shipping internationally,” Practical eCommerce added. “It is better to do thorough research of the different local shipping providers in a specific country if large volume of orders is expected from that country. Otherwise, if the international order volume is small, then the retailer can work with a well-respected international shipping provider like DHL.”

Determining the geographic location of your target market can help you identify the shipping provider that will reduce shipping costs within that area.

2. Transit times

Meeting customer expectations is an important part of any business. This extends to shipping and handling times. Some retailers sell items they need to be delivered quickly, such as flowers, and in that scenario merchants need to go with a shipper that can deliver goods with the fastest mode of transportation. If that isn’t a direct need, then they can consider other options.

The lower the additional cost of shopping online, the more shoppers will follow through with a purchase instead of leaving abandoned shopping carts behind.

By identifying the geographic location of your target market and transit times that apply to your business, you will in turn identify the best shipping providers for your customer base. Determining the shipping provider that provides the lease cost to you, also provides the least cost to your customers. The lower the additional cost of shopping online, the more shoppers will follow through with a purchase instead of leaving abandoned shopping carts behind.

3. Shipping Software

Retailers can use multi-carrier shipping software to identify their options across shipping providers, including cost and delivery times across international and domestic shipping providers. Often, using shipping software will be cheaper than going directly through a shipping provider, allowing retailers to choose the cheapest method of delivery for each individual order.

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