Date created: Oct 25, 2022 • Last updated: Feb 26, 2023
What is Abandoned Checkouts?
Abandoned Checkouts is an e-commerce metric that measures the value of all the abandoned orders (i.e., sum of the prices of all the items in those orders) before shipping and taxes. Abandoned Checkouts is an important metric for online businesses as it shows the value of customer orders that were not completed due to a variety of reasons. It helps reveal any potential issues in your checkout process, such as customer difficulty in filling out forms or selecting payment options, that are preventing customers from actually completing their purchases.
Abandoned Checkouts Formula
How to calculate Abandoned Checkouts
Over the past 30 days, 500 visitors reached checkout with a total of $20,000 (before shipping and taxes) in their carts. Of those 500 checkout visitors, only 100 successfully purchased, with a value of $5,000 before shipping and taxes. The Abandoned Checkout amount for the past 30 days is = $20,000 - $5,000 = $15,000.
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More about Abandoned Checkouts
Abandoned Checkouts can have a significant impact on an e-commerce business's revenue. It is estimated that businesses are losing up to 75% of their potential revenue due to checkout abandonment. That means that for every $100 spent on marketing and advertising, only around $25 will actually result in a sale. This indicates the importance of optimizing the checkout process to reduce abandonment and maximize revenue.
Businesses should focus on improving their checkout experience by making it easier, faster, and more secure. Additionally, they should consider using automated emails to remind customers of their abandoned orders or providing incentives such as discounts or free shipping to encourage them to complete their purchases. By analyzing Abandoned Checkouts, businesses can identify areas that need improvement in order to boost sales and increase profits.
To get a better understanding of the issue, businesses should look at various factors that could be contributing to checkout abandonment, including customer demographics (age, gender, location), browsing behavior (page visits, time spent on each page) and payment preferences (payment methods, shipping options). By segmenting the Abandoned Checkouts data, businesses can discover any potential pain points in their checkout process and make improvements accordingly.