A new study by the Coller School of Management at Tel Aviv University reveals the psychology behind abandoned online shopping carts.

The peer-reviewed study, titled “How E-commerce loses billions of dollars due to psychological considerations,” found that the money lost in online shopping revenue may be driven less by cost or shipping and more by how shoppers feel about the contents of the carts.

According to the estimates, at least 70% of online shopping carts are abandoned before payment, meaning vendors have spent significant amounts on advertising, operations, and user experience, only to lose out on the final sale.

The study explains that when a consumer abandons their shopping cart, retailers have already incurred high costs. when the purchase doesn't complete, they lose out on expected revenue. This then occurs on a large scale, resulting in an annual revenue loss of billions of dollars.

Tel Aviv University’s new study offers a psychological explanation for this phenomenon: carts containing more indulgent, less necessary items generate feelings of guilt and wastefulness in the buyer, increasing the likelihood of cart abandonment.

Professor Liat Hadar, one of the leading researchers, noted that: “shopping cart abandonment does not stem only from technical considerations such as price or shipping, but from a deeper psychological process of purchase justification and guilt.”

The study found that "indulgent" and "non-essential" carts evoke feelings of guilt, making it difficult for the buyer to justify the expense to themself. The guilt creates hesitation and delay, which can eventually lead to complete cart abandonment.

The researchers concluded that including utilitarian products, such as basic necessities or functional items, in the cart fosters a sense of balance, reducing guilt and decreasing the risk of cart abandonment.

They note that the study has implications and suggestions for online shopping websites and their managers, as it suggests that recommending the addition of useful equipment or items may reduce abandonment, even if they don’t actually get added to the cart, as it can change the customers’ perception of their carts.

“The message for e-commerce companies is that small changes in the cart's composition or in how it is presented, such as recommending useful products, can reduce guilt, improve the shopping experience, and lead to a significant economic impact," said Hadar.