The checkout exit rate (often discussed in terms of its inverse, the checkout abandonment rate) represents the percentage of customers who start the checkout process but leave before completing a purchase. It is calculated as described below, based on information about checkout abandonment:
Understanding Checkout Abandonment and Exit Rate
The key concept to understand the checkout exit rate is the checkout abandonment rate. According to the provided reference, the checkout abandonment rate is the percentage of customers that are leaving checkout after initiating the checkout process. This abandonment rate is directly related to and informs the exit rate. While "exit rate" might refer to people exiting from the checkout process, its significance is understood through the lens of abandonment.
Checkout Abandonment Rate Calculation
Here’s how the checkout abandonment rate is calculated, as presented in the reference:
- Divide the total number of completed transactions by the number of initiated checkouts that are abandoned.
- Subtract this value from 1.
- Multiply by 100 to get a percentage.
Formula:
Checkout Abandonment Rate = [1 - (Completed Transactions / Abandoned Checkouts)] * 100
Inferring the Checkout Exit Rate
While the reference explicitly defines the abandonment rate, we can infer the exit rate through the understanding that it is the inverse. If X% of users abandon their cart, 100 - X% would not be considered exits in the sense that they completed the process. To calculate a direct "exit rate" independent of successful transactions, we need to focus on abandoned checkouts relative to all initiated checkouts.
A more direct way to view the Checkout Exit Rate:
Checkout Exit Rate = (Abandoned Checkouts / Total Initiated Checkouts) * 100. This is the same as the Checkout Abandonment Rate.
In practical terms, a high checkout exit rate indicates potential problems with the checkout process, such as:
- Complicated Forms: Too much information requested.
- Unexpected Costs: Shipping or other fees not revealed early.
- Security Concerns: Lack of trust signals.
- Poor User Experience: Confusing or slow checkout.
Understanding and addressing these issues can significantly reduce abandonment and increase conversions.
