An introduction by Niklas Adalberth, Deputy CEO and co-founder, www.klarna.com
E-commerce is growing, rapidly and steadily. In recent years, it’s mobile shopping that’s the driver. Although there’s an increase in laptop shopping, the speed of growth in mobile shopping is changing the game.
Today, many retailers find that 50% or more of their traffic comes from smartphones and tablets. Still, this doesn’t mean more sales for the retailers. In fact, it could be the other way around.
Getting people to the e-store isn’t enough. E-retailers are spending lots of time and money on marketing, logistics, products and store layout. All this to get the customers to the e-store and to make the visit a nice experience. This is all good – but only if your checkout is optimal — otherwise, the investment in time, effort and money is wasted.
We believe the checkout is the most important part of the store and the user experience. To maximise sales, you need to maximise conversion. To maximise conversion you need to remove all friction. This applies for a laptop customer as well. But it becomes even more apparent for someone shopping — or should we say intending to shop — from a smartphone.
Consumers want an excellent shopping experience. But they also need an excellent checkout experience – which means one they do not have to think about whatever route they have taken to get to it. If they have to struggle to complete their purchase, they will simply abandon it.
If 100 people go to the checkout, how many shop? The reality is pretty painful reading if you are an e-retailer. Research shows that of 100 customers that typically entered an online store and clicked on ‘go to checkout’ only 33 actually carried out their purchase. Imagine 100 people walking up to the checkout in a physical store and then two thirds of them just leaving their things on the counter and walking away. This would cause panic among managers in real life stores. So why doesn’t it create panic among online business managers?
When it comes to mobile retail those already poor stats drop even further. In a smartphone checkout – research shows that three (yes you read that right – three!) out of 100 complete their purchase.
There seems to be a “truth” about e-commerce today, which says that everyone should excel at everything. We don’t really believe in this. We are convinced that e-commerce is about specialising. A retailer that tries everything may not excel at anything. Such a player will struggle against fierce and specialised competition. Instead we believe businesses should focus on doing one thing really, really well.
A bookseller should focus on offering the biggest and best range of books. A clothing retailer should focus solely on providing the fashion its target audience is looking for.
The rest should preferably be left to specialists. The specialists are completely dedicated around a single field, with the resources to focus on the granular details that may not look like much, but play a crucial role in the complete experience.
Approximately four trillion dollars worth of merchandise will be abandoned in online shopping carts this year. That’s $4 trillion dollars worth of goods from UK retailers that could have been purchased by domestic consumers or exported. It doesn’t matter what you sell, these numbers are terrifying, and send loud and clear signal to any business that needs to effectively sell online to survive. Make it easier to buy your goods, across all devices, and conversion will bloom.