stopwatch

I spend a lot of time online shopping. I’ve encountered a bevy of payment systems, each with its own quirks. By now, though, payment and checkout processes are overwhelmingly fluid and user-friendly. For more than a year, I’ve been involved with two different SaaS businesses where I’ve been able to exercise a high degree of control over how the checkout processes work. One of the topics that I have not seen written about (at all) is how a merchant should handle customer session expiry. Directly: is it appropriate to display a timeout countdown to a user during the checkout and payment process?

There are two aspects to payment hurrying. One is purely psychological: will a customer be more likely to buy an item or otherwise rush through the payment process if he or she sees a countdown? The second is functional: will your business be able to better serve customers by expiring their sessions after a set amount of time?

In the real world, the shopping cart is a physical basket of goods you intend to purchase. Once you place an item in your cart, it’s there. It might as well be yours. If you remove the item somewhere else in the store or decide you don’t want it at the register, it might be hours or days before another customer can buy that same item. The cart works especially well at retailers stocking redundant (essentially, commoditized) goods where the typical customer is going to buy more than one product. It encourages browsing and idling, providing utility in situations where scarcity isn’t a factor.

However, in times where demand outpaces supply, the basket on four squeaky wheels can seem a bit ridiculous. On Black Friday and other occasions where customers may visit big-box retailers, the unspoken rules of shopping carts are often tested. Do you really have a right to purchase that new gaming console just because it’s in your cart? What about if there are none left on the shelf but you haven’t made it to the checkout counter yet? Is it a crime for someone to fish into your cart and grab that item that you spent hours in a queue waiting for? I don’t know–the rules change when scarcity becomes a factor.

Online cart management requires the balancing of three things: 1. Customer experience 2. Inventory management and 3. Maximizing revenue per customer.

The most important issue is that it’s terrible for the customer–and bad for your business–if you take payment for things you no longer have in inventory. In the earlier days of the internet, the practice, which is still employed by many large retailers, involved performing an inventory check at the last possible moment before checkout and informing the user of a stock out if one occurred. Does that save the business a lot of hassle? Sure. But, it makes for unhappy users. When a user sees the “cart” as the embodiment of what they’d push around at Walmart, the equivalent of getting told “you can no longer buy that” at the register can be hard to process.

Worse, some smaller websites that aren’t particularly skilled at inventory management will sell things that they no longer have in stock. Sometimes, these goods are irreplaceable, and the refund process can be a headache for all involved. Other times, the shady retailer will attempt to procure the item and elongate delivery to the customer without admitting to the root cause. This has happened to me more often than I’d like to admit. When it does, I vow to never do business with the retailer again. Other customers probably feel the same way–it feels like a blatant violation of the trust between buyer and seller.

In situations where the item is extremely in-demand or one-of-a-kind, it may be appropriate to mark it as unavailable whenever it is placed in a user’s cart. This is a common practice when it comes to concert tickets, hotel rooms, and flights. Your purchase and purchase price are guaranteed for a time, which, absent a software glitch, is more of a guarantee than placing it in a physical cart on a Black Friday in the late aughts. Almost all websites featuring this approach will display a timer showing when the session will expire. Once the session expires, you need to start the checkout process all over again and your goods are released back into the virtual storefront.

In practice, this works well. There’s a genuine need solved by managing carts this way. However, there are a lot of subtleties up for debate. The first is that rushed customers are, generally, less happy customers. Nobody likes being hurried, but, fearing digital embarrassment spurred by being indecisive, people are shockingly obedient once the clock starts counting down. This is the kernel of what inspired this essay and I wish someone could study this at the university level so my crackpot theories and sweeping generalizations could be validated. On the negative side, people may purchase less overall when they see a clock. On larger sites like Amazon, a timer would be a major inconvenience. People may not have time to fully read the Terms and Conditions (which would be a fascinating legal case!). People may buy products on whims and be more prone to wasting customer support time or simply returning the items. When someone’s session gets timed out, they probably feel a bit disrespected and will be less likely to restart the purchase process. This can all be studied via A-B test by retailers who get reliable, voluminous customer streams. Unfortunately, the businesses I am involved with are not quite ready for segmented experimentation (I experiment–I just don’t have the numbers for a properly scientific approach).

More recently, it’s become more common for sites that don’t have the same stocking concerns to display payment countdowns. On Shopify, there are plenty of plugins to help with this. The most popular is Countdown Cart, which has over 8000 reviews and sports the tagline: “Add urgency, scarcity & social proof to maximize conversions.” Here’s the distinction: it’s plausible that Shopify has very strong inventory management safeguards to prevent the issues from above from occurring. It’s also plausible that most Shopify stores don’t remove items from what’s ‘available’ once they are in customer’s carts, simply because the sites aren’t particularly highly-traffic and the goods aren’t actually all that scarce. So, this plugin and plugins like it are primarily used to convert customers. To get them across the finish line. While kind of slimy, I think it’s important that entrepreneurs consider such an add-on. An online business has every right to define an arbitrary amount of time for a customer session. My guess would be that most Shopify stores are, on average, only selling one item per purchase to a customer who will never return anyway, so many of the consequences of using a timer don’t apply.

In one of my personal ventures, I held out on adding a payment timer for a long time. Mainly because SaaS businesses have absolutely no need for them. In any case, I designed my own and plopped it on the site. Anecdotally, conversions are up (which isn’t necessarily correlated). Not only are conversions up, but conversions between people picking a plan and registering (when the timer starts) and paying are also on the rise. Of course, you could argue that maximizing targeting of customers who intend to buy has something to do with this. However, most credibly, the average time between registering (when the timer starts), payment, and ‘final details’ submission has decreased. I don’t have hard numbers, but the psychological effect of the timer has been clear both to me as a consumer and purveyor of merchandise on the internet.

The session expiry countdown can be a controversial, though effective method of increasing conversions in online storefronts while helping to effectively curate inventory and customer experience. However, it is best suited for small businesses and those selling products that are highly demanded.

Session Expiry During Checkout