Abandonment rate is a term used in marketing to measure how successful an engagement or experience is. It is essentially a metric that measures the percentage of customers who do not complete an action or process, such as making a purchase or abandoning a website visit. It is an important metric for marketers as it can provide insight into the effectiveness of their campaigns and customer engagement efforts.
Why is abandonment rate important?
Abandonment rate is an important metric for any marketer, as it measures how successful the customer experience is. It can reveal any problems customers are having while engaging with a product or service, and suggest ways to improve the customer experience. For example, if a customer is abandoning the purchase process halfway through, it could indicate confusion with the checkout process or pricing structure. By understanding the points in the customer journey where abandonment rates are highest, marketers can make changes to make the customer journey smoother, resulting in a better customer experience and potentially higher sales.
How to measure abandonment rate
Abandonment rate is typically calculated by dividing the number of customers who don’t complete an action or process, by the total number of customers who has started the process. For example, if 1000 people began a checkout process, and 600 of them completed it, the abandonment rate would be 40%.
Each business will have different methods for tracking customer actions, but some common ways to measure abandonment rate include:
- Website - Set up analytics software such as Google Analytics to track visitors to your website and measure things such as pageviews and time spent on each page. A high abandonment rate could indicate areas where customers are struggling to understand and move between pages.
- Shopping carts - Shopping carts that are integrated with third-party analytics tools or their own in-house software can track when customers abandon a purchase process, and allow you to track the customer journey.
- Email campaigns - Email marketing software such as MailChimp can track when customers open an email, click a link, and convert or purchase. Adapting emails to be more customer centric, based on data such as website visits or purchase behaviour, can reduce abandonment rates and increase sales.
- Phone calls - If you receive a high volume of phone calls, look into call tracking services such as Invoca and CallTrackingMetrics. These services provide vital metrics such as the number of calls received and missed calls, call lengths, and conversation transcripts.
How do I improve my abandonment rate?
Once you have gathered data on your abandonment rate, you can use this information to make changes to your customer experience. Here are some tips to help drive customer engagement:
- Make your website user-friendly - An intuitive and user-friendly website is essential for reducing abandonment rate. Simplifying the user journey with clear labels and simple navigation will ensure customers are able to find what they need and move between pages on your website quickly.
- Provide helpful customer support - Customers need to know that there is someone they can turn to if they have any questions or issues. Providing helpful customer support, such as a 24/7 chatbot or live customer service agents, will make customers feel looked after and more likely to complete the purchase process.
- Make use of customer feedback - Listen to customer feedback and take this into consideration when making changes to your customer experience. Use customer feedback to identify problems and suggestions, so you can make changes that cater to the needs and wants of customers.
- Offer different payment options - Offering customers different payment options, such as PayPal and the ability to store payment details for later use, can make the purchase process quick and easy and reduce the chances of customers abandoning their transactions.
- Track abandonments - Setting up analytics and tracking software will allow you to gain insights into the customer journey. Keeping an eye on abandonment rates will tell you how your customers are engaging with your product or service, so you can make adjustments to the experience and reduce abandonment in the future.