A 75% checkout conversion rate for your repeat ecommerce shoppers is within reach - here’s how

Today, there are an enormous number of key metrics that ecommerce companies look to improve, such as average order and customer lifetime value, loyalty, and more. 

But with the cart abandonment rate around 70%, and Strong Customer Authentication typically shaving off another 15-30% of potential conversions, the biggest opportunity today is in reimagining the checkout experience. In fact, companies that are putting a renewed focus on the checkout - such as Giosal, Sublime, and Cristiano Calzature - are achieving cart-to-order conversion improvements of 20%-50% for first time shoppers. 

This is a needle-moving improvement that should capture the attention of any ecommerce company. But as impressive as these results are, they are still just the beginning. For repeat shoppers, cart to conversion rates experienced by these companies are as high as 75%. 

These exceptional repeat purchase conversion rates are the result of several factors, including some visible to the customer and some under the hood. In this post, we will examine each one, and how they could combine to help drive an Amazon-like conversion rate for your business. 

A brief introduction to Magic Checkout

But first, some context about the solution. These businesses are working with Magic Checkout, an initiative of Scalapay. On the shopper side, Magic Checkout is a solution built to deliver a speedy, easy checkout experience - a recognized, trusted way to buy across multiple ecommerce stores. On the merchant side, Magic Checkout is designed to do two things: a) solve the complexity of offering an express checkout experience, while b) enabling flexibility in terms of payment methods, acquirer and risk partnerships, and so on. 

With that in mind, here is how these points can drive exceptional repeat (and first-time) purchase conversion rates. 

1. A consistent,recognized, and express checkout experience

Key conditions to maximize conversion at the checkout for repeat shoppers include:

  • An express checkout experience (1-2 clicks max).
  • A predictable, uniform UX. 
  • The shopper’s preferred payment method.  

For key European markets such as Italy, France, and Spain, cards are the main payment method, which means offering the preferred way to pay is almost always a default option. Yet even today, too many merchants ask their valued repeat customers to re-enter card details each time they make a purchase. This added friction is one of the key drivers of cart abandonment and a huge opportunity to improve cart-to-conversion figures. 

With a third-party solution such as Magic Checkout, card tokenization - where card details are securely anonymized and stored for future transactions - is taken care of, and other key information such as the billing address is saved. Furthermore, the payment UX is consistent across every single merchant that offers it. So every time your newly-minted customer makes a subsequent purchase, checkout is no more than a couple of clicks max, within a reassuringly familiar look and feel. This drastically increases the chance of conversion for repeat customers with very little legwork from the merchant side.

2. The network effect of a trusted brand

To briefly recap the meaning of “network effect” it is the phenomenon where a product gains more value as more people use it. For example, LinkedIn becomes more valuable every time a new person joins, as they are a potential customer, colleague, source of information, or so on to their entire network, therefore incrementally raising the value of the product overall. 

With Magic Checkout, you benefit from a growing network effect in immediate and longer-term ways. 

a) If a first-time shopper who is already on the Magic Checkout network arrives at your webshop, they will recognize the Magic Checkout brand and be a) more likely to pay, and b) have a faster, easier payment experience - without compromising your ability to collect key shopper data. As you would expect, these two factors have substantial positive effects on conversion, leading to immediate results for your business. 

b) Just as important, as with any network effect, every customer and merchant added to the network makes it stronger. So not only are you benefitting from shoppers and merchants on the network today, every new addition to the network is unlocking future potential conversion improvements for your business. Each new merchant adds new shoppers on the network, who are more likely to convert on your ecommerce site, and so on. 

3. And the flexibility to iterate and expand - without the complexity 

If you are operating in Spain, France, or Italy, this should sound like a compelling proposition. But what happens if you want to expand to markets which aren’t card-dominated, such as Germany or the Netherlands? How will you deal with new payment methods? And there are other questions. You might be interested in a third-party checkout solution, but want to continue with your trusted payment service provider. Or on the other hand, maybe you are happy to work with a trusted payment service provider so long as you don’t need to put in lots of integration work. 

With Magic Checkout, merchants are enabled to orchestrate their entire checkout stack. Are you happy with your acquirer? No problem, you can continue with Magic Checkout as the checkout solution and your trusted acquirer running the connections behind it. Want to A/B test different solutions? Can do. Or simply want to work with a trusted, proven solution used by other merchants on the network? Also possible. And finally, if you want to add important payment methods such as Paypal, that is possible with much less effort than if you wanted to do your own integrations in-house.

Bringing it all together to drive 75% conversions for your repeat customers

Creating that express checkout experience that works across markets and seamlessly with your preferred technology involves many considerations, but the payoff - both in terms of improved customer experience as well as cart-to-conversion metrics - make it more than worthwhile. 

But remember - it doesn’t make sense for an individual ecommerce company smaller than Amazon to try and solve all the optimizations and edge cases you will encounter - not to mention the advantages offered by tapping into a network of existing users with payment details already pre filled and ready to buy at your store. 

To find out how Magic Checkout could drive your cart-to-conversion to new heights, get in touch with us.

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