US retailers losing up to $24bn through poor mobile experience, study suggests
More than a half of US smartphone owners (56%) have abandoned a mobile transaction because of usability issues, slow loading times and poor navigation and check out, finds a study by Jumio. And it is costing US retailers as much as $24 billion in lost revenue.
Apparel, the largest mobile commerce sector, is also the most frequently abandoned, with three in five (60%) of those reported abandoning purchases doing so with apparel items (clothing, shoes, accessories). These rates vary by gender and age, with women (68%) more likely to abandon a clothing or apparel transaction than men (51%), especially female millennials (78%).
Surprisingly, consumers abandon both purchases big and small at similar rates. Smaller purchases such as ordering food or purchasing movie tickets are neck and neck with big ticket purchases such as booking travel.
Retailers who prioritize mobile checkout stand to reap some big returns, finds the study. Nearly one-quarter (23%) of those who have reported abandoning a mobile transaction say their cart was valued at $100 or more the last time they abandoned a transaction at the checkout.
Interestingly, two thirds (66%) of those who have abandoned a mobile transaction went back and attempted that transaction again later, with the computer being the preferred method the second time around.
So why are they abandoning mobile purchases? According to the study, after purchase uncertainty (45% respondent attribution), issues with speed (36%) and ease of navigation (31%) are top reasons cited by those who have abandoned a mobile transaction. In fact, users are more likely to abandon a purchase due to user experience issues than due to the security of payment (27%) or personal information (26%).
In addition more than a one-third (36%) reported apps/mobile sites being slow to load, while 31% reported that apps/mobile sites that are too difficult to navigate. 28% responded that it is difficult to type personal information on small screen and 22% reported that the payment process was too complicated.
Nearly a third (27%) reported concerns around security of payment info and a quarter reported concerns around security of personal info.
In addition to the majority of the survey recipients abandoning transactions, the study also found that nearly a quarter of consumers abandon their attempts at opening an online gaming (27%) or financial services (23%) account and over one-third (34%) of those who abandon a transaction do not attempt again.
“As mobile transactions continue to skyrocket, so do abandoned purchases, incomplete account openings, and lost revenue,” says Marc Barach, Chief Marketing Officer, Jumio. “Businesses have heeded the warning and are finally prioritizing mobile checkout experiences, underscored by the ten percent improvement in abandonment rates over the last two years,” said Barach. “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.” Abandonment rates by sector:
- Retail/Apparel – 60%
- Food (groceries or takeout) – 41%
- Travel – 41%
- Household items – 39%
- Event tickets (concert, sporting event) – 39%
- Entertainment purchases (39%)
- Electronics – 35%
- Online gaming (opening an account) – 27%
- Applying for financial services account (opening an account, money transfer) – 23%