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Comment by Jedd | Hacker News Reader

From the video (interview):

> 75% of people (85% if you include mobile) abandon your site at cart checkout - that's a trillion dollar problem in the US each year.

Well, I can see at least two problems with that claim.

First, anecdata, I'll often be forced to get to the checkout stage just to find out what shipping is going to cost me -- this may be more a problem in my region (Australia) where shipping can be onerous, and vary wildly between vendors, so it's an inevitable, but quite time-consuming way of comparing total costs.

Second, even assuming that number is accurate (it's not clear how he got there) those trillion dollars are very much part of a zero sum calculation. It reminds me of the old hyperbolic claims that piracy was removing billions of dollars from the economy.

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Almost 90% of my female friends keep shopping carts full of items as their wishlists or curation lists for clothing. A bit less of my male friends do the same, or do it for other type of items, but still do it. I call bullshit on this data as well. The shopping carts translation to actual purchases has little to do with intent to buy and more about browsing. Similar to how loads of people go to a clothing shop to try out 10 different outfits because it's an interesting activity and may not buy anything at all, regardless of fit.

It's also somehow "more real" than wishlists in the ecommerces that support it (not all of them do).

Or your checkout could be Klarna which demands your date of birth... Which I am never going to give to a shop just to purchase a piece of clothing.

But my transaction didn't vanish, it wasn't abandoned, I consciously moved it to a competitor who won't ask me for my date of birth. No money disappeared from the economy, no more was added, it just went to a company that moderates it's demands for data.

And retailer, if I could tell you this I would but you don't offer a feedback collector during checkout and by the time you've followed up on the abandoned checkout I've probably already received the item from your competitor.

Klarna is just a payment option, and one which is a line of credit too. You could have just selected a different method surely?

It depends.

Some merchants offer PayPal or Card or Klarna as options on the first part of checkout. Those are fine.

Some merchants though, have given their entire checkout process to Klarna and the card and other options are downstream of entering the Klarna checkout process. This means that you'll have the date of birth question, and also be sending your transaction data to a credit company, even if you're still paying fully by debit card.

Two examples I recently encountered were UK PC parts merchant, I've being sponsoring a child of an impoverished single mum ( https://docs.google.com/document/d/1NCHV1pcTyvtbbE-mBDFhE1K7... ) and he'd managed to earn enough to purchase a custom computer - he's only 12 and this is such an achievement. We used pcpartpicker to design the build, and two of the suppliers recommended by that in the UK have fully given up their checkout process to Klarna. I switched ordering those parts to Scan and Box instead.

Wow, then presumably those merchants will likely fail, or they will spot the negative impact of Klarna in time (before failure) and switch to something else, or Klarna will change their checkout process to address this issue.

Or, as with anything else privacy related, outside of intellectual bubbles like HN the vast majority of people don't think twice about giving up unnecessary PII to a payment processor because they naively think the entity won't sell or leak their information. Even those who see conspiracies around every corner somehow constantly fall victim to identity theft due to negligence, and divulge way too much information for their own privacy and safety every day.

A movie quote springs to mind: "A person is smart. People are dumb, panicky, dangerous animals and you know it."

Or as is even more often the case with HN:

In practice, “Date of Birth mandatory” is a merchant controlled setting in Klarna [0]. I’ve used Klarna for card countless times and never hit a site that requires it. I’m guessing GP saw it once and never bothered to update his dataset (a surprisingly coming problem among us intellectuals)

[0] https://www.klarna.com/assets/sites/6/2021/09/20095942/user_...

Nice.

So I've followed up and called one of the retailers to ask why it's mandatory and got "We use Klarna and Klarna requires it, but you can enter a fake one and still get through as it's not verified.". This is awd-it.co.uk which was one of the two merchants in which I encountered it.

I suspect they're wrong though, and that you are right. Klarna didn't require this, but someone at this company configured it. Perhaps it's something about PC components for gaming computers, some kind of data gathering that helps protect against kids using their parents card.

There wasn't a way that I could configure not to give it though... I'm just a customer. Whilst I could use a fake date I'm more likely to treat this as a "your data is about to go to another third party" red flag and shop elsewhere still.

Thanks for the info. I wonder if, now or at some point in the past, Klarna had mandatory customer DOB as opt-out rather than opt-in for a default card processing setup on the merchant facing side, and many small businesses in my experience either don't have IT staff or it's their cousin's wife's uncle doing IT for them on the cheap, and they just don't see it or understand its significance.

I know there were dozens of switches to flip when we switched to a new storefront and shopping cart vendor a few years ago, and I missed a few initially despite my experience with setting those up in the past. That's what sandboxing is designed to catch, but I can picture PHBs in every industry saying "damn the testing, full speed ahead!" with no thought for consequences.

Willing to share which merchants so we know who to avoid in future?

It's neither anecdata nor zero sum.

We have very good data on that kind of thing, and everyone in e-commerce is intimately aware of how that works.

The 'buying funnel' is so segmented that operations will definitely have a bunch of layers for 'checkout' or 'shopping cart' anyhow i.e. 'browsing' 'intent' 'initiated' 'partially completed' 'completed'.

And very aware of what pricing shock, shipping shock etc. does to the funnel.

75% abandoned is about right because most carts these days are not filled with 'intent to purchased' they are used kind of as a 'bookmark'.

Anyone integrating Bolt would know that.

It's also not 'zero sum' - online buying behaviour is not fully rational - it's instinctive. (We are conspicuous consumers - we likely don't need 1/2 the stuff we buy!)

For example - a 2 page checkout, streamlined with absolutely do more in sales than a longer checkout process.

Bolt is very legit concept, with a networking concept i.e. that they already have your 'data' in the system from purchases at other sites, they can make checkout at your site quicker.

All of that said, I'm not fully sure how defensible it is.

Lastly, it's weird that they are sued. E-Commerce people are not dupes, they would have some sense about how well this could work and would definitely have some skepticism and not sure what kind of guarantees bolt would offer anyhow.

> We have very good data

I am not aware of your username, but who has very good data?

Everyone with more than $2M in sales and larger companies have very deep data on it. The industry as a whole is very knowledgeable, it's very sophisticated.

What I meant by anecdata with my first point is that it was purely a personal observation, an action that was a consequence of a consistently poor shopping experience in my part of the world, for the types of things I buy online.

Typically I was only ever going to purchase the item(s) from one vendor, but need to generate & abandon multiple vendor carts to work out the cheapest option. Like many things in life, I assume everyone does this, but acknowledged that this may in fact be uncommon.

With my second point, I might have been ambiguous in my comment about reliability of the number -- I was not disputing the 75% (or 85% on mobile) claim, as I have no doubt there are good numbers about this, and it's probably reliable to extrapolate those numbers from the various larger online shops that release those stats.

I was suggesting the 'one trillion dollar problem' was a dubiously sounding figure -- apart from very large, very round numbers inevitably sounding like hyperbole, and something someone trying to sell me something to 'fix' that problem would very much want to talk up, there's the non-trivial problem of obtaining the total-$ figure on all those abandoned carts across every vendor's system over the year.

The zero-sum reference is to the implied (and ludicrous) claim that if a trillion dollars worth of sales were abandoned, every year, and just in the USA alone, those dollars are still 'out there', unspent, sitting in someone's cookie jar, and all it would take is for a more streamlined checkout system in order to magically summon them forth and deliver them directly into the pockets of Bolt's customers.

Of course $1T problem is ridiculous. That said, it's a big problem.

I often abandon the checkout because I am not fully committed to buying at that moment in time.

I'll often return and complete the purchase a day or two later once I have become commited.

There is an entire industry built around the idea that their solution is what made this happen.

Problem being, it's really hard to prove it didn't.

I'm fairly certain Amazon and Shopify understand this problem well and that their stats (~70% of carts are abandoned) are reasonably faithful:

https://pay.amazon.co.uk/blog/how-amazon-pay-addresses-cart-...

https://www.shopify.co.uk/blog/shopping-cart-abandonment

Yes, you're right - please see my reply to a sibling comment.

(I don't doubt the 75-85% figure, rather the $1T one.)

I agree, the $1T figure seems a bit fantastical.

I worked at Shopify - Pay is all about getting the Shopify brand into consumer minds. They had a huge problem where retailers used their platform but there was very little stickiness, the customer relationship was owned by the retailer. With Pay Shopify used it's existing install base to collect customer info and intermediate their relationship with merchants, making it harder to move a shop off Shopify.

Of course they need to tell a story about increased revenue to the retailers, because otherwise why would they voluntarily give Shopify control over their relationship with their customers?

That's pretty funny. When I checkout I don't care if it's Stripe, Shopify, Square, or the business owner's nephew processing my transaction. Why in the world would I make shopping decisions based on who the payment processor is? It's like choosing stores based on which point of sale terminals they bought.

It reduces friction for purchases.

If I am on my phone, I am more likely to complete a transaction if I can just hit the Shopify Pay button. If I need to complete some form that looks like it is from the early 2000s, I might wait until I am in front of a computer, by which point I may lose interest. (There is a lot of middle ground between these two extremes though.)

Similarly, I am more likely (when there are multiple alternatives) to revisit a merchant that uses Shop Pay because of the reduced friction.

And even taking the claim at face value.. people didn't buy something that they decided that they didn't want. Surely this is a good thing, toxic economic systems aside? Less work done, less environmental impact, ...

For me the main reason to abandon any kind of online shopping experience is if it is a requirement to supply data that has no bearing on the transaction or if I am required to make an account.

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