Reducing Your Order Cancellation Rate

Cancelled orders are a pain for both the retailer and the customer. Often the question that goes unanswered is why did the consumer place the order if minutes or hours later they abandon their shopping cart or sometimes even pay and then decide to cancel it? There are a myriad of reasons, some we retailers can try to minimise and others which frankly are beyond our control.

You may know your abandoned cart rate on your website, but probably not on marketplaces but chances are buyers are still viewing your items and not completing the purchase. Today, Neil Goldsmith, Head of Merchant Relations at Flubit has a few tips for retailers on how to ensure the highest customer satisfaction in order to avoid the extra cost and the hassle of abandoned or cancelled orders.

Reducing Your Order Cancellation Rate

Any online retailer experiences order cancellations, both pre and post-dispatch. According to recent research by PayPal, last year e-tailers lost sales worth over £2.7 trillion due to cancelled and abandoned orders.

Dealing with cancelled orders can be costly and time consuming for the merchant and also often frustrating for the customer. For the shopper there are the issues that might have led to them wanting to cancel the order in the first place. Then there is having to chase the merchant and check bank statements to ensure the refund has been processed. For the merchant the cost is yet greater; increased administration costs, needless transaction costs and the risk of negative feedback.

For merchants to keep order cancellations to manageable levels the key is to understand why the majority of orders get cancelled in the first place and take action accordingly:

1) Give clarity to your shoppers on handling and delivery times

Frequently the shopper will cancel an order because of a lack of clarity or accuracy in advertised handling and dispatch times. A shopper will lose patience waiting for delivery of an item and then request cancellation, often after the item has been dispatched and is already in transit. The best way to avoid this happening is to manage shopper expectations. If this is not an item you hold in stock, or you have 2/3 day handling times then make this clear from the outset. If the item ordered is one that you dispatch by 2/3 day courier then list the delivery window accordingly so the shopper has visibility on the lead times.

2) Communicate with your shoppers

Another reason a shopper might cancel an order is lack of communication from the merchant. Keep the shopper ‘in the loop’. If you are re-stocking the item and this will cause a delay in dispatch times, drop the shopper a message and let them know. If you have shut the warehouse for a stock take and are a day or two behind on dispatch, then advise shoppers of the delay. The most common complaint from shoppers we get at Flubit is that the merchant did not keep them updated. Be sure to send dispatch confirmations as soon as you release the goods so the shopper knows they are on the way. Also, make sure that you respond promptly to customer support requests. A shopper is far more likely to cancel an order if they feel that they are being ignored or lose confidence in the merchant.

3) Make the shopper trust you

Some orders are cancelled because shoppers get cold feet about a product or even a retailer. This is otherwise known as ‘buyer remorse’. They have second thoughts and decide to cancel their order and go to a shop they have purchased from before, even if it costs them a few extra pounds. Maintaining good shopper feedback across the various online marketplaces is essential to help avoiding this. Similarly, if you feature on such sites as Review Centre and Trust Pilot, be sure to monitor your rating on these sites and listen to your customers. Respond to their feedback where possible and appropriate.

From time to time orders are cancelled because the shopper simply decides they do not require the product, or they read a negative product review post purchase. In such cases there is little you can do as a merchant – that’s online retail. However in the other 80-90% of occasions, the shopper cancellation decision is largely avoidable. Have clarity in your handling and delivery times, keep shoppers updated on their delivery progress and answer all support requests promptly. Then just watch your customer feedback rating soar and those cancellation rates tumble!