When a customer has decided what to buy, you need to make it as quick and painless as possible to make the purchase. A 50% to 75% abandonment rate is not uncommon in the shopping cart. Baymard Institute has aggregated a number of statistics here which shows various rates from a number of different collectors. Checkout abandonment is not as high as shopping cart, but it is still real. Some customers are simply window shopping or want to check shipping rates, but others start to have second thoughts once they get into the checkout process. To overcome any obstacles, this process needs to be quick and efficient.
The steps might be arranged in a different order, but the customer has to complete this information:
- Registered user or guest?
- Enter billing and shipping address
- Enter payment info
- Summary page
When customers get to checkout, they have made their decision and just want to get the purchase done. The more time it takes to complete the greater the chance they’ll abandon the purchase. That doesn’t mean you can’t upsell, you just have to make it easy. Amazon’s one-click purchasing is the best example of the most unobtrusive checkout possible which bypasses the first three steps and simply displays the purchase summary. They have stored the customer ID, billing, shipping, and payment information and the customer acknowledges they want to make the purchase.
Unless your Amazon, though, most product companies won’t have enough customer data to streamline the process, but you can still make your checkout simple.
Guest checkout or sign in
You want your users to register so you can do follow up marketing but customers don’t want to register because they don’t want to get irrelevant information. So you need to make it enticing and easy to register. You have a few options for this. Social sign in is the easiest. Next, they could do a guest checkout or if they expect to make repeat purchases, they’ll register.
- Guest checkout: They can do a guest checkout, but you should really try to capture their information so you can provide a more personal experience the next time they log in as well as make it easier for customer service and support. Also, if they do a guest checkout, they’ll need to enter their billing and shipping info.
- Social sign in: How many IDs do you have to remember? You probably use the same ID from site to site and sometimes you have to vary your password depending on the security requirements of the new site. Make it easy for customers to log in. Social sign in is one of the simplest ways to do that. On the back end, you would still capture a shadow user ID in association with the user’s social ID to enable you to store additional info like addresses and preferences but this is hidden from the user and all they have to remember is their Facebook, Google, or LinkedIn ID.
- Custom user id management: The third option is custom user id management. Here you have to store the customers ID and password. There are different security protocols for passwords and many require a capitol letter, numeral, and symbol but not all. The tradeoff is that the more rules you require the more likely it is that it won’t match their existing passwords and they’ll forget it. That drives up customer service issues because customers will call sales support even when they can reset their password automatically. When you go down this path you’ll need login screens, reset/forgot password, forgot ID, and the data store for user name and encrypted password. You can make it simpler by using an SSO (single sign on) solution that takes the hassle out of id management, but that is for another discussion.
Regardless of how you do it, customer information will hang off the customer if you can get them to sign in. If not, the billing and shipping info will sit on the transaction.
Billing and shipping info
Typically in checkout, the next step is shipping and billing. If the customer logged in, you can automatically populate the billing and shipping info with their customer profile information. This step may look straightforward to the user, but on the back end it is very heavy. Once you have the customer’s address then you can check the validity of their address, calculate shipping rate, tax, recycling fee if applicable, or check the denied party list if applicable. These are all callouts to services that take time which could cause the customer to get impatient while they wait.
- Verifying address: To process credit cards and calculate shipping charges you need a valid address. There are services that do this through a remote API where you can send the address and get a list of matching valid addresses back. The customer then selects the correct one and continues.
- Display shipping rate: Once you have a valid address, you can send it to a shipper to calculate the cost. Depending on the products and location you may offer just standard shipping or expedited at an additional cost. The weight of the products could also affect the amount so they must be sent in the request as well.
- Calculate tax: Taxes are complicated in the US. Brazil is complicated, too. Other parts of the world are easier with straight percentages for Goods and Service Taxes, but you must provide a tax calculation which is another service that is called.
- Non-taxable entity: In some cases, you need to allow customers to opt out of taxes because they are a non-taxable entity. This isn’t common, but you need a way of validating the request is legitimate.
- Recycling fees: For some products, recycling fees must be collected. Once the customer enters their address info, you will know if they reside in California or other locations that require recycling fees.
- Denied party list: Again, this is another service for sensitive equipment. You will need to send the customer name and address out to the service that will allow or deny the purchase from continuing. If it is denied, then the order would be routed to sales support before processing.
For business customers, you may need to add a layer of complexity to the billing and shipping addresses. In many cases, businesses will only allow specific addresses to be shipped to and you must provide a dropdown of their locations that the purchaser can select from. Or in other cases, the business may allow a deviation from the addresses where the customer can freely enter an address. Regardless, serving business customers can complicate the process some.
As you can see, the customer billing and shipping might appear simple to the customer, but all the back end services complicate this step and could cause a delay. There are techniques you can employ to minimize this delay such as submitting the requests as soon as you get the address information, but you really are at the mercy of how quickly the services can respond.
Enter payment info
Payment info is the next step. Sequentially, payment processing is dependent on the billing address so you need to enter it prior to selecting a payment method. Here the checks are more obvious and in the interface you can alert the customer when there might be a delay such as when you process the credit card information.
There are services to assist in credit card processing, but unfortunately when you offer international sales, you might need to employ the use of multiple services for the local flavors of payment methods. Often in the US, we assume customers want to buy with Visa, Mastercard, AMEX, or paypal, but across the globe there are different credit card options like JCB in Japan and Boletto in Brazil that allows customers to pay over time. If you are supporting global customers, you must be able to support the most common payment options they have. Some flavors include credit cards, purchase order, Boletto, Cheque, PayPal, bank draft, and consumer financing.
It’s also possible to bypass all the steps above by routing to either Amazon or PayPal checkout. This simplifies the checkout process because the customer logs into the respective service and then can take advantage of any stored information they may have with the service.
Thank You Page
The thank you page is a simple summary of what was purchased and where it is being shipped to. It also gives you an opportunity to register the user one more time. You already have the customer’s email and address information and can capture that in association with a new user by allowing them to enter a password.
The explanation above describes the components of checkout at a high level. Most eCommerce systems will have support for a lot of the functionality. However, when you delve deeper into business customer needs and international payment options you may have to integrate multiple services as no service provides coverage of all international requirements. In a future blog post, I will discuss these complexities and different marketing options you can employ in the process.