High Price Tag for Mobile Shopping Cart Abandonment (Aug. 19, 2015)
Mobile commerce providers and retailers left a potential $24.5 billion in revenue on the table because of user experience issues, according to a new report from Jumio Inc. The company’s latest Mobile Consumer Insights Study found that, despite consumers’ increasing reliance on mobile devices, providers and merchants continue to struggle with transaction abandonment in the mobile channel. Of the more than 2,000 adults in the U.S. polled for the survey, 56 percent reported having abandoned a mobile transaction. After purchase uncertainty, usability issues rounded out the top three reasons for doing so, with 36 percent of abandonments attributed to slow loading times, and 31 percent to difficulty with navigating the checkout process. Given that mobile commerce revenues reached $57 billion in 2014, according to Statista Inc., abandoned transactions work out to $24.5 billion in lost revenue, Jumio estimates.
However, there are signs of progress. In the previous edition of the study, in 2013, 66 percent of respondents reported having abandoned a mobile transaction. “Businesses … are finally prioritizing mobile checkout experiences, underscored by the 10 percent improvement in abandonment rates over the last two years,” said Marc Barach, chief marketing officer, Jumio. “But experiences are still far from being as seamless as they need to be in order for retailers and financial services providers to stem the tide of lost opportunity and put nearly $25 billion back in their pockets.”
M-commerce providers able to provide a better user experience stand to reap significant rewards. Nearly one-quarter of abandoned transactions were valued at $100 or more, while 32 percent were between $50 and $99. Meanwhile, 46 percent of users said apps that were easier to use would make them less likely to abandon a transaction, the study found.