Online shopping is defined by a series of equally important steps. In a linear online shopping journey, the action of adding a product to a cart follows that of viewing a product. We recently examined product views per visit, by industry over a four year period, in a previous blog post.
The add-to-cart rate measures the percentage of sessions where a shopping basket was created; it is a strong signal (but not the final signal) of buying intent. For the purposes of benchmarking performance for global brands, we analyzed add-to-cart data for about 2,000 sites over a 4-year period, and we uncovered some interesting trends.
The data shows that, to a large degree, price influences the rate at which shoppers add products to a cart. Luxury apparel brands, with an average price point of $300, see consistently lower add-to-cart rates between 2% and 10%, while health & beauty sites, with an average price point of $20, see much higher rates in the range of 5% to 20%.
As with product views per visit, it may seem natural and obvious to compare industry averages for add-to-cart rates within one’s business vertical. But brands, irregardless of industry, may not want to put too much weight on industry averages, because, while industry averages are a good starting point, your place relative to your competition really depends on the “spread” – how far and varied are the values between the best-in-class, the not-so-best, and everybody in between.
Seeing this industry data confirms what merchants and marketers have always known intuitively – price matters, especially when the shopper is adding something to their cart. So, as a merchant, when you compare your add-to-cart performance within your industry, keep this in mind and ask yourself, irrespective of whether your metrics are underperforming or outperforming, if the benchmark’s average price is representative of your catalog’s average price points.
One other nugget to point out here is what’s happening in general apparel, where an important trend is emerging. When contrasting the health & beauty segment with luxury apparel, we see that the former is experiencing increasing variance across a larger number of sites, but luxury apparel sites are more or less clustered around a smaller range. Now, look at how general apparel is evolving – it’s more like health & beauty!
What’s happening? The add-to-cart rates for general apparel sites will be as varied as health & beauty this year and leading into 2019. This means that the best-in-class are pushing the envelope, increasing the variance or “spread.” When looking for inspiration, look beyond general apparel retailers and look at health & beauty leaders. You might just learn something that creates a meaningful improvement to your shoppers’ experience.
Next up in our Digital Commerce Benchmark series – checkout rates per cart created.