Don’t let cart abandonment ruin 2020’s bumper holiday season sales

Not having a preferred payment method available at checkout can wreck sales and experiences, argues this payments expert.

The seasonal rush has officially begun. Last month 10.10 kicked things off in the Asia-Pacific region (APAC) and many of us recently browsed the sales on Amazon Prime Day.

Now the flurry of seasonal sales will accelerate toward the end of the year and into 2021. Alibaba’s 11.11 Global Shopping Festival (previously called Singles Day) is likely to be the largest shopping event ever. Across the United States, Thanksgiving, Cyber Monday and Black Friday will capture the attention of those across the globe. 

Notably, last year these online shopping days gave merchants a welcome boost in advance of Christmas and New Year’s Day. On Singles’ Day in 2019 alone, Alibaba saw a 26% uptick in year-on-year sales topping US$38.4 billion in just a 24-hour period, making it the largest e-commerce event ever.

With 2020 tipped to be even bigger, merchants are in for a bumper sales period.  

Breaking down e-commerce down borders

With people around the world stuck at home, some unable to visit family and friends, and many not able to leave their countries, the e-commerce marketplace has provided a welcome space for consumers. For merchants, this means a wider audience is primed to take advantage of online deals. 

Earlier this year, our data found that spending on areas including home decor, digital goods, women’s fashion, food and beverage, healthcare and cosmetics all increased over the summer months. 

The findings highlighted the opportunity that merchants can capture this festive season to capture their slice of the market. 

An unprecedented year

In 2019, there were three times as many transactions as the previous few years. So, apart from expecting the usual headlines of around this year’s Alibaba event like “New sales record achieved for 11.11”, what makes this year’s online shopping seasons bigger and better than the last?

Firstly, there are more consumers shopping online, and in many cases cross-border, than ever before, and secondly, those people are shopping differently to the way they were last year. 

This new online population spans all age, genders and location demographics—their purchasing power is strong. They are shopping online for goods and services they would have previously purchased in store, particularly as markets go into further states of lockdown as they suffer from second or even third waves of the pandemic in the runup to the festive season. But finally, and perhaps most importantly, countries across APAC are also encouraging this shift toward a digital economy and online retail more now than ever before.

Across Asia, governments and enterprises are encouraging small-and medium-sized enterprises (SMEs) to accelerate their digital agendas to cope with the impact of COVID-19. In Indonesia, the government has launched the Bangga Buatan Indonesia (Proud of Indonesian Products) initiative to help SMEs onboard their operations onto e-commerce platforms and conduct online retail trade. Similarly, Shopee launched a region-wide Seller Support Package in April this year, with over 300,000 sellers, SMEs, and entrepreneurs signing up within the first month of launch. 

The effects of these initiatives are two-fold. First, the entry of more sellers will help drive consumption across townships and cities that were previously less entrenched in the e-commerce ecosystem. Second, merchants will also gain access to the global e-commerce market and showcase their products to a wider global audience base. 

Hence, apart from driving online sales to another all-time high, the presence of both new and experienced merchants in e-commerce necessitates a tailored approach that will help them to capture customers who are at different stages of their e-commerce journey. 

Offering diverse payment methods

All too often, the simple act of letting consumers see that a wide range of available preferred payment methods at checkout, is missed by merchants.

Overlooking crucial details like this can result in missed sales opportunities, with average cart abandonment rates already estimated to be somewhere between 60% and 80%. Of those who abandon their carts, 20% cited that they did so because they did not have the option to pay with their preferred payment method. 

To ensure success, merchants should put themselves in the consumers’ shoes. Check the user experience of your shop, look at the payment methods available to you at the check-out: are a wide range of preferred payment methods available, or would you walk away at the point of transaction?