Why Guest Checkout Degrades Online Shopping Customer Experiences

November 1, 2021

The Bolt Team

Successful brands know their customers intimately—their preferences, habits, and even favorite colors—and this knowledge helps create better online shopping customer experiences. Brands can even anticipate what customers will need next based on shopping behavior and offer post-sale customized follow-ups, discounts, and offers. This familiarity is the core of the relationship between a great brand and its customers. It not only helps power the customer experience but also significantly increases the value of the relationship for both.

Customer Data Powers Personalized Experiences

Great brands invest in sophisticated AI algorithms that guide customers to their next purchase by providing highly personalized product selections, themes, and even pricing—but these algorithms only work on recognized returning customers. Recognition is only possible if the customer has created an account. And a frustratingly large number of first-time purchases are made through “guest checkout,” preventing brands from identifying (and later recognizing) their customers.

Forcing a shopper to create an account is the second top reason for cart abandonment.
Brands can improve the online shopping customer experience and increase initial conversion rates by lowering the friction of that first transaction and making their virtual checkout experience fast and painless.

What’s worse, even if the customer created a store account, they will likely either forget that they’ve done so or return using a different (uncookied) device. The average adult consumer has access to 11 connected devices. They often use multiple devices—and even multiple browsers or apps on each device—to complete a single purchase. Keeping track of customers becomes incredibly difficult when even your known customers are anonymous at each new touchpoint.

Brands can leverage the massive investment they’ve made into personalization and unlock an average 20% increase in sales by offering a customized shopper experience over a generic one—but ONLY if they can regularly recognize returning guests.

Better Online Shopping Customer Experiences = More Frequent Visits and Higher Lifetime Value

Highly customized emails, texts, advertisements, and other customer communications are at the core of successful brand interactions. The after-purchase experience is as vital for the lifetime value (LTV) of a customer as the actual purchase process. Curated experiences significantly increase retention rates—which in turn boosts profits.

It’s 350% more profitable to sell to an existing customer than a new one.

A customer who receives notifications when their favorite products are back in stock, on sale, or updated will return to the store again and again. Of course, the effectiveness of these communications is only as good as the underlying data. This is why recognizing your customers each time they visit—regardless of the device they use or whether they make a purchase—is so critical. You can’t associate that visit data unless you recognize the customer.

To power their post-purchase experiences effectively, brands need visitor data from purchasing visits and non-purchasing visits and from as many browsers and device combinations as possible.

Is It Possible to Improve the Online Shopping Customer Experience without Guest Checkout?

Yes! However, brands often feel like they don’t have a choice when it comes to guest checkout. Many businesses choose to offer guest checkout as an option to expedite and simplify the checkout experience for hurried shoppers. There is some truth to this, but there are pros and cons to allowing guest checkout. While brands may not feel the immediate impacts of these anonymous transactions, they miss out on customer data and opportunities to maximize customer lifetime value.

Customer expectations and the effects of anonymization

Check out part 2 of our series to better understand today’s customer expectations and read part 3 to learn why anonymization has more negative impacts than you may realize.

ThinkShop by Bolt does not constitute professional tax or financial advice. Contact your own tax or financial professional to discuss your situation.