Conversion

4 Things Add-to-cart Rates Tell an Ecommerce Business

Add-to-cart rate is a key performance indicator for ecommerce.

Add-to-cart rate is a key performance indicator for ecommerce.

Monitoring an ecommerce business’s add-to-cart rate can identify and solve conversion problems, and, ultimately, help an online store earn more.

Add-to-cart rates track the percentage of site visitors who add a product to a shopping cart. This performance indicator is often closely associated with bounce rate, which tracks the percentage of visitors who leave after seeing just one page on a site, and cart completion, which describes the percentage of visitors who buy something.

Each of these metrics contributes to conversion, and they can be used to troubleshoot, if you will, your ecommerce business. Add-to-cart rates inform ecommerce operators about their product selection and prices; about marketing, including merchandising; about the checkout process; and even something about the promises your site is making to consumers as they shop.

1. Products and Prices

A site suffering from low add-to-cart rates, say below five percent, may have problems with site navigation, site search, product selection, product presentation, or pricing.

You’ll need to do more analysis to figure out which of these problems is plaguing your site, but it can be helpful to categorizes them as you do look for specifics.

  • Finding products. Site navigation and search issues impede a shopper’s ability to find products.
  • Desiring products. Product selection and presentation issues imply the shopper is disappointed with a product once found.
  • Valuing products. Pricing issues arise when shoppers don’t perceive a product’s value.

Improve in any of these categories, and you would expect to see a commensurate increase in your store’s add-to-cart rate.

2. Marketing

Examining add-to-cart rates in the marketing context can provide some important insights into which campaigns are the most effective.

For example, for the third quarter of last year, Monetate, which provides multi-channel testing and personalization services, reported that ecommerce add-to-cart rates were 10.62 percent for direct traffic, 10.23 percent for shoppers following an email marketing link, and 7.54 percent for shoppers arriving from search engines.

Monetate's add-to-cart rates by marketing channel providing an interesting example for ecommerce operations. The highest add-to-cart rates came from "direct" customers, those that entered a site's URL in the browser bar. The lowest came from social media referrals.

Monetate’s add-to-cart rates by marketing channel providing an interesting example for ecommerce operations. The highest add-to-cart rates came from “direct” customers, those that entered a site’s URL in the browser bar. The lowest came from social media referrals.

Assuming these rates are similar for your businesses, you could look, for example, at individual email marketing campaigns. Email messages with the goal of increasing the number of items sold and that exceeded an add-to-cart rate of 10.23 percent would be good performers. These are the sorts of email messages you would want to repeat.

Likewise, a search engine marketing campaign or search engine optimization strategy that wasn’t generating an add-to-cart rate of 7.54 percent would be underachieving relative to the average. You’d know to examine it, tweak it, and try to improve it.

3. Checkout Process

The difference between your site’s add-to-cart rate and cart completion rate represents much potential business and a lot of potential for improvement.

Depending on which industry report you choose to use, somewhere between 30 and 40 percent of the shoppers who add an item to an ecommerce shopping cart will eventually complete the checkout process.

Conversely, somewhere between 60 to 70 percent of shoppers will not actually buy the items they placed in the cart. So even a small improvement in the difference between your add-to-cart rate and cart completion rate has the potential to add up to a lot of money.

Imagine your ecommerce store’s returning customers, those who have come back after making a purchase. These returning customers are more likely to add an item to the shopping cart. But what if they convert at a slightly lower rate?

This could be an indication that you’re not making it easy enough for returning customers. First-time buyers expect to have to enter billing and shipping information, but returning customers like to be recognized.

You will need to do a bit of analysis, but this is just the sort of thing that the difference between add-to-cart and cart completion rates can indicate.

4. Promises You Make

Finally, add-to-cart rates can be an indication about whether or not you keep the promises you make to shoppers.

Online shoppers expect consistency from your marketing to your product presentation and to your checkout. What you say about products or even about prices is a sort of promise that you’re making to your customers.

Add-to-cart rates that are out of line with bounce rates on one side and cart completion rates on the other may mean that you’ll failing to keep promises somewhere along the shopping journey.

As with every example in this article, you will need to be a bit of research and analysis to figure out just where you’re breaking expectations.

Armando Roggio
Armando Roggio
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