Online retailers understandably worry when a customer abandons her shopping cart right before completing a purchase. But sometimes, other factors can lead to an incomplete sale, despite the customer’s best intentions to buy.

As a customer, I know I’ve done it: investigated the product, carefully read the product reviews, compared prices from different sources, both online and in the store. I’ve even put the products in the shopping cart, ready to buy. But sometimes, that purchase doesn’t get completed.

Unlike typical shopping cart abandonment–when a customer simply decides to wait before making a purchase, or changes her mind without clearing the cart—this is an unintentional abandonment. Something happened that made the buying process fail. Understanding this nuanced difference, the possible causes and the effect on the customer experience is key to figuring out a solution and how to best approach the customer again.

A variety of stumbling blocks can keep your customers from completing the sale, such as a confusing process, unexpected shipping costs or time, or concerns about payment security. However, a declined credit card is certainly one of the biggest deal breakers in making a purchase—even when it’s not the consumer’s fault.

A recent Wired’s Innovation Insights report revealed that $40 billion is lost each year when unnecessary red flags are raised and online transactions are blocked. And, unlike when a customer chooses not to buy, being unable to buy creates a negative customer experience. When a customer’s credit card is declined, 31% blame the retailer. In addition to the financial inconvenience is the emotional fallout. Customers get angry when their purchase plans are thwarted, with 83% of consumers surveyed saying they are embarrassed and frustrated. 8% admit to feeling betrayed and not trusted. For many, this could be the end of their relationship with the retailer. Since nearly 1 out of every 5 consumers reported having their credit card declined at some point, this can have significant effects on a business.

Credit cards are generally declined for several reasons:

  • The credit limit was exceeded
  • The account is delinquent
  • A suspicious charge was made
  • A hold is on the account
  • An international purchase was made
  • The card information was incorrect
  • The card had expired

I’ve experienced a credit card decline when my card has expired. This happened when I had already shopped at a store and kept my credit card information on file. Knowing it was on file, I didn’t think I needed to have my credit card information nearby. But when I needed it to make the purchase, I had to step away from the computer, and go downstairs to get my card, where I was interrupted by life along the way and did not complete my purchase.

An expired card is one of the less frustrating reasons for a credit card decline. People who have more complex credit card issues have to contact the credit card company and spend time with customer service to resolve the issue. By the time it is handled—or not—the customer is among those frustrated and angry 83%, and most likely is no longer in a shopping mood.

Alternatives for Credit Card Decline

Online retailers can’t cure a customer’s credit issues, but they can provide alternatives to help a customer complete a purchase.

  • Give customers options. Not just credit card options, but payment through checking account, gift card and through services that may not be tied to the same bankcard, such as PayPal or Amazon Payments. Even as long as 10 years ago, studies indicated that businesses offering four different types of payments converted 72% of their shoppers, 20% more than those offering one type of payment. Baymard Institute, a web usability research institute, says it has saved sales of 30% of customers who get their cards declined twice at checkout by offering payment types like PayPal and Google Wallet.
  • Create an alert for immediate notification when a customer’s card is declined and contact them through a personalized email or by phone to offer assistance and an alternative payment method.

Most of the time, a customer’s credit card issues are beyond the reach of the retailer. But, by additional payment options and immediate customer service, they have a better chance of salvaging the sale and maintaining a good relationship with the customer who was all ready to buy.

Mike Arsenault
Mike Arsenault is the Founder & CEO of Rejoiner. He works with 350+ online retail & eCommerce companies like Hydroflask, Footjoy, GUESS, and Big Chill to help them grow faster using lifecycle email. He also once lived aboard a 36' sailboat in Boston.