Cart size matters — a lot.
Data from Bluecore’s 2020 Retail Email Benchmark Report reveals a strong correlation between consumer spend level and email engagement across retail verticals. Specifically, shoppers that spend more (and therefore have a bigger cart size) have higher conversion rates and lower unsubscribe rates than those who spend less.
And that’s just the tip of the iceberg.
Differentiating Between Spend Level and Lifetime Value
First, let’s take a look at exactly how spend level gets determined.
It’s important not to confuse spend level with lifetime value. Spend level looks at how much a customer typically spends in a given order. We can break this down into three groups: High spenders, low spenders and average spenders. The exact number breakdown for each group will be different for each retailer and can even fluctuate over time based on the success of efforts to increase cart size.
In contrast, customer lifetime value looks at how much a customer will spend with a brand over time. While there is certainly a relationship between this measure and spend level, the two do not equal one another. Consider the case of two customers: One high spender who typically has a cart size around $150 but only purchases twice a year and one low spender who typically has a cart size around $25 but purchases every month. At the end of the year, each customer will have spent the same $300.
Evaluating the Impact of Increased Cart Sizes
The more customers spend per order, the greater their cart size. And the greater their cart size, the more likely they are to continue engaging over digital channels like email.
Most notably, data finds that the more shoppers spend, the more likely they are to convert via email and the less likely they are to unsubscribe from these communications. For example, high spenders in apparel convert at a 26% higher rate than average spenders and a 48% higher rate than low spenders.
This pattern of engagement also reveals an interesting trend when evaluating click-to-open and click-to-conversion rates. Low spenders tend to deliver similar or higher click-to-open rates than average and high spenders, but this trend mostly reverses itself when looking at click-to-conversion rates. This analysis reveals that low spenders tend to do more research upfront before making a purchase, which leads to higher click and open rates, whereas high spenders are more likely to engage with emails when they are ready to buy.
Finally, previous studies on spend level further underscore the value of increasing cart size: A deep analysis on second purchase rates reveals that the more customers spend on their first purchase and the more items within that purchase, the more likely they are to make that all-important second purchase.
Altogether, these findings lead to the understanding that the more shoppers spend with a brand, the stronger the connection they are likely to feel, which creates loyalty to buy time and again.
Top Tips to Increase Cart Size
Given the fact that increasing cart size can help grow loyalty and revenue, achieving this goal should be a top priority for retail marketing teams. So what exactly does it take? Here are three tips to get you started:
- Personalize emails based on factors that impact open rate: Personalizing emails based on factors that impact open rate, like the subject line and send time, can continue to drive more engagement from lower spenders (who have a higher tendency to research purchases first, resulting in high open and click rates) while also encouraging higher spenders to open more emails, which is important since this group has a higher tendency to purchase once they do engage.
- Trigger dynamic popups based on site behavior: Once shoppers start engaging onsite, and particularly as they begin adding products to their cart, trigger dynamic popups that encourage them to increase their cart size. These popup modals might include personalized recommendations for related items or “next best purchase” products or an offer for free shipping over a certain price point.
- Include additional product recommendations in triggered emails: As shoppers become eligible for abandonment triggered emails, be sure to include personalized product recommendations within those messages. Doing so can help accelerate the discovery process and entice customers to add more to their purchase.
Dig Into the Data with Bluecore’s 2020 Retail Email Benchmark Report
Bluecore’s 2020 Retail Email Benchmark Report explores the extent to which retailers have embraced email for different types of communications, the level of personalization used across email and the effectiveness of those messages. To review more trends and see how your email performance compares to Bluecore’s benchmarks, click here to download the full report.