The future of eCommerce is frictionless (part 1)
In this post you’ll get an overview of:
- How friction in the check out experience can lead to a massive drop-off in conversion.
- What a frictionless experience should look like for your customer
- New technologies that are making it possible to create a frictionless commerce experience across every online channel
Friction leads to cart abandonment
So we already know that about 50% of shoppers abandon their carts because they were just browsing. Research shows that most of the other reason they don’t complete their purchase has to do with the checkout experience.
eCommerce customers surveyed said the reason they abandoned their cart were:
- 24% – the site wanted me to create an account
- 18% – checkout process was too long/complicated
- 7% – weren’t enough payment methods
The key takeaway from this – these are all moments of friction that you can address by creating a frictionless checkout experience.
$260 billion lost to friction
A frictionless checkout allows your customers to move through the sales funnel as quickly and efficiently as possible. Amazon has set the consumer standard by offering one-click purchasing. All a logged-in shopper needs to do is click once on an item they want and the system completes the transaction instantly. If your current ecommerce experience has more steps than this, you’re likely losing an opportunity to convert customers.
So what does this missed opportunity look like? Well, the average large-sized e-commerce site can gain a 35.26% increase in conversion rate though better checkout design.
If we look at the combined e-commerce sales of $738 billion in the US and EU, the potential for a 35.26% increase in conversion rate translates to $260 billion worth of lost orders which could be recovered through a better checkout flow and design.
Changing consumer behavior
And all this is particular urgent for your business now thanks to the changing consumer behaviours that have been accelerated by the effects of the Covid-19 pandemic.
For one: consumers are adopting more types of digital payments. A Mckinsey study found the share of consumers using two or more digital payments methods jumped from 45 percent last year to 58 percent in 2020. This points to a future where consumers will expect to be able to pay in multiple ways, digitally.
According to the same study, more than half of US consumers reported shifting purchases online from brick-and-mortar stores since the onset of COVID-19. And more than one-third expect to further increase their share of online shopping in the coming six months. This is a strong indicator that many new shopping and payments behaviors prompted by COVID-19 are likely to persist for the long term.
Key takeaway: you can’t win without online shopping and the way to win eCommerce is with a frictionless, one-click buying experience that includes multiple payment options.
New technologies for your brand
Luckily, new technologies are making it possible to create a frictionless commerce experience across every online channel, from your brand’s website to social media and even to checking out directly within email.
Artificial intelligence (AI)-powered payments startup Skipify allows customers to buy instantly across any sales channel, including emails, texts, and ads. By creating dynamic, shoppable emails (no coding required), merchants who use Skipify have reported seeing revenue increase by 30%.
Mikmak helps consumer product companies – including grocery, alcohol, and CPG brands – understand and perfect their consumers’ online journey, drive online sales at retailer sites, and optimize their media spend. Ultimately, they help customers shorten the path to purchase from anywhere while also improving the effectiveness of their marketing. Brands that use Mikmak reported seeing a boost in conversion rates as high as 48%.
Fast removes all friction points and makes one-click checkout possible for any DTC brand – no account creation, password, or entering a shipping address necessary for their customers. It also allows customers the convenience of a single dashboard to track their purchases, shipping, and returns from multiple retailers.
Want to learn more? Stay tuned for part 2 in this series where we tackle how to incorporate frictionless payments into your brick and mortar experience.