he success of your abandoned cart recovery depends on the knowledge that comes from tracking the right key performance indicators (KPIs).
Understanding your abandoned cart metrics means increasing your e-commerce conversion rate over time…
And setting up abandoned cart emails that generate, literally, $7.45 per email sent.
Even in small e-commerce stores we consistently see incredible revenue from abandoned cart emails and optimizations, but only if the updates are done so with the right metrics in mind.
In this blog, we’re not going to hold back. We’ll go over the top 4 cart abandonment KPIs that we track when implementing our abandoned cart strategy for e-commerce websites.
We will even include some real-life numbers from our e-commerce clients for comparison.
When we track and adjust our systems according to these metrics, we’re able to achieve incredible automation results.
So, enough fluff – what are the main cart abandonment KPIs you should be tracking?
KPI #1: Cart Abandonment Rate
What is Cart Abandonment Rate?
Cart Abandonment Rate is the percentage of digital shopping carts that are abandoned by customers prior to completing the checkout process.
How to calculate Cart Abandonment Rate?
You can calculate your Cart Abandonment Rate by dividing the total number of completed purchases by the number of shopping carts created. You then subtract the result from one and then multiply by 100 to get the abandonment rate.
(1 – ( total # of completed purchases / # of shopping carts created)) x 100 = cart abandonment rate
You can fetch this metric by using the Exploration feature in your Google Analytics 4 account as seen below or, if you have the number of completed purchases and the number of carts created already handy, by using this free Cart Abandonment Calculator.
According to recent data from the Baymard Institute, the average Cart Abandonment Rate across all industries is 69.99%. However, no matter the number, adopting new strategies to reduce it is always recommended.
Why is Abandonment Cart Rate important?
The Cart Abandonment Rate can help you understand the shopping behavior of your website visitors and is often the initial indicator of a potential issue in your checkout process.
Tracking your Cart Abandonment Rate is crucial for e-commerce stores since it represents potential sales that will never be realized if there are no additional efforts made after customers abandon their carts. No one likes money left on the table.
How to improve Abandonment Cart Value?
Successful strategies to reduce your Abandonment Cart Rate include: offering a wide range of payment methods, providing guest checkout options, including thumbnails of products throughout the checkout process, showing total savings at checkout, offering free shipping, and optimizing page load speeds.
KPI #2: Average Order Value
What is “Average Order Value”?
The Average Order Value is the average dollar amount spent each time a customer places an order on your e-commerce store. While Abandonment Cart Rate is important, it does little to show how much actual revenue is lost. That is where your Average Order Value comes in.
How to calculate the Average Order Value?
To calculate your store’s average order value, simply divide total revenue by the number of orders.
average order value = revenue / # of orders
For WooCommerce users like us, the Average Order Value can also be found under the Analytics > Orders tab as seen below.
According to LittleData, If your WooCommerce site has an Average Order Value of $50 – $292, you have an average AOV. However, if your site has an AOV of $36 or under, you are definitely underperforming this benchmark.
Why is Average Order Value important?
Understanding the average Abandoned Order Value gives you the full picture of the real impact of abandonment on your e-commerce store. It helps you evaluate the long-term value of individual customers and your overall pricing strategy.
How to improve Average Order Value?
Successful strategies for increasing Average Order Value include cross-selling, upselling, volume discounts, free shipping, coupons, and return policies.
KPI #3: Time to Checkout
What is Time to Checkout?
Time to Checkout is the total time it takes a customer to complete a purchase. The less time it takes them to buy, the happier they are with the experience.
How to calculate Time to Checkout?
You can calculate the Time to Checkout by timing yourself going through your own checkout process multiple times and calculating the average time. Doing this might show you first-hand if your checkout process has lengthy actions that are demotivating customers from hitting that place order button.
Why is Time to Checkout important?
Knowing how long the average customer takes to buy will help you find ways of decreasing this time. It also helps put into perspective how long the process takes. Remember what customers want, and try to provide the fastest, most efficient experience.
How to improve Time to Checkout?
Successful strategies to increase your Time to Checkout include: allowing guest checkout, showing a progress indicator, and adding the Guaranteed Safe & Secure checkout badge (as seen below).
KPI #4: Abandoned Cart Recovery Rate
What is Abandoned Cart Recovery Rate?
The Abandoned Cart Recovery rate is the number of people who return to their cart to go through with the purchase. Usually as a result of abandoned cart recovery emails.
How to calculate Abandoned Cart Recovery Rate?
To understand what your abandoned cart recovery rate is (and how much you could be missing out on) you can use the following calculation.
(total # abandoned carts / # of recovered orders) x 100 = abandoned cart recovery rate
If you are a Klaviyo user like us, you can simply add your Placed Product Rate from your Abandoned Cart email Flow as seen below. For example, one of our Abandoned Cart Flows has generated a total of 17.9% Placed Order Rate, which translates to an Abandoned Cart Recovery Rate of the same value.
If your abandoned cart recovery rate is above 10%, you are doing a good job. Above 20% is considered exceptional.
Why is Abandoned Cart Recovery Rate important?
Calculating your abandoned cart recovery rate gives you a benchmark to measure what is and isn’t working. With the help of some extra feedback and review processes, you can even find out where in the process (and why) your buyer originally dropped off.
Plus, why would you want to miss out on sales?
When you understand what caused a buyer to abandon their cart and then subsequently return to purchase, you can eliminate that painstaking time in between and make a plan to encourage purchases the first time.
How to Improve Abandoned Cart Recovery Rate?
Successful strategies to increase your Abandoned Cart Recovery Rate include: offering a unique promo code or free shipping.
When you first start your abandoned cart strategy, remember that you are no longer fighting for attention. Instead of worrying about figuring out user intent or customer education, you now need to close the deal. If you track and analyze these fundamental metrics and KPIs you’ll stand a better chance of getting users past the add-to-cart phase.
If you feel like you could be doing more for your e-commerce email marketing, we would love to connect with you!
We juggle data-driven insights and powerful automation to create email solutions that convert and build out your revenue growth strategy.