How do you calculate abandoned cart recovery revenue?

Multiply your abandoned checkouts by your recovery rate for the recovered orders, then by the cart value, less any discount. 2,000 abandoned checkouts at 5% is 100 orders; at €90 each with a 10% discount, that is €8,100 a month.

What is the difference between an abandoned cart and an abandoned checkout?

A cart is abandoned when someone adds items and leaves; a checkout is abandoned when they start checking out, usually after entering an email address, and do not finish. Reminders can only reach shoppers you have an address for, which is why Shopify's recovery report works on checkouts.

What recovery rate should I use?

Your own. Your email or SMS platform reports the share of abandoned checkouts that end in an order after a reminder. If you have no flow yet, plan with a low rate and let the first weeks of data replace it.

Should the reminder include a discount?

Only if it wins orders you would not otherwise get. A discount comes out of your margin on every recovered order, including orders from shoppers who were coming back anyway, and it can teach regular customers to wait for one.

Were the recovered orders really caused by the reminder?

Not all of them. Shopify counts a checkout as recovered when the customer completes it after the email is sent, even if they came back on their own. A holdout, where a random share of abandoned checkouts gets no reminder, shows how many would have completed anyway.

Why gross profit rather than revenue?

Because the goods in a recovered order still cost what they cost. Taking the reminder costs off revenue, as if the goods were free, overstates what the flow earns by the whole cost of the goods.

Abandoned Cart Recovery Calculator

Result

Fill in abandoned checkouts a month, average abandoned cart value, recovery rate, gross margin to see the result.

How it works

Recovered orders are the abandoned checkouts times the share that end in an order after your reminders. Each brings in the cart value, less any discount. What it leaves is the cart value times the margin minus the discount: a discount comes off the price, so it comes out of the margin in full.

Take off the monthly cost of sending the reminders and you have what the flow earns, on the assumption that the reminders won every recovered order. That assumption is the weak point; see below.

recovered orders =
  abandoned checkouts × recovery rate

recovered revenue =
  recovered orders × cart value
  × (1 - discount)

gross profit =
  recovered orders × cart value
  × (gross margin - discount)

after costs = gross profit - reminder costs

What each term means

Abandoned checkouts: Checkouts started with an email address or phone number and not completed. Shopify counts one as abandoned after it sits incomplete for more than ten minutes once the email is given.
Cart value: The value of the goods left in those checkouts, before any discount. It can differ from your average order value.
Recovery rate: The share of abandoned checkouts that end in an order after a reminder: from your email or SMS platform's report, or the rate you are planning for.
Discount: The discount in the reminder, if recovered orders use it.
Reminder costs: What the app or plan that sends the reminders costs a month.

Not every recovered order was won by the reminder

Shopify counts a checkout as recovered when the customer completes the order after the email is sent, whether they used the recovery link or came back on their own. Some of those shoppers were coming back anyway, and a discount given to them is margin given away for nothing.

To see what the reminders add, leave a random share of abandoned checkouts without reminders for a few weeks and compare how many complete in each group. The difference is the flow's real effect.

Worked example

Example numbers, round on purpose. They are not a real store.

Abandoned checkouts a month: 2,000
Average abandoned cart value: €90
Recovery rate: 5%
Gross margin: 50%
Monthly cost of the reminders: €100
Discount in the reminder: 10%

1Recovered orders: 2,000 × 5% = 100
2Recovered revenue: 100 × €90 × (1 - 10%) = €8,100
3Gross profit: 100 × €90 × (50% - 10%) = €3,600
4After reminder costs: €3,600 - €100 = €3,500
5Return on the reminder costs: €3,500 ÷ €100 = 3,500%
6Value in abandoned checkouts: 2,000 × €90 = €180,000

Without the discount the same 100 orders would leave 100 × €90 × 50% = €4,500 of gross profit. The discount costs €900 a month, paid on every recovered order, including those that would have come back without it.

Frequently asked questions

How do you calculate abandoned cart recovery revenue?
Multiply your abandoned checkouts by your recovery rate for the recovered orders, then by the cart value, less any discount. 2,000 abandoned checkouts at 5% is 100 orders; at €90 each with a 10% discount, that is €8,100 a month.
What is the difference between an abandoned cart and an abandoned checkout?
A cart is abandoned when someone adds items and leaves; a checkout is abandoned when they start checking out, usually after entering an email address, and do not finish. Reminders can only reach shoppers you have an address for, which is why Shopify's recovery report works on checkouts.
What recovery rate should I use?
Your own. Your email or SMS platform reports the share of abandoned checkouts that end in an order after a reminder. If you have no flow yet, plan with a low rate and let the first weeks of data replace it.
Should the reminder include a discount?
Only if it wins orders you would not otherwise get. A discount comes out of your margin on every recovered order, including orders from shoppers who were coming back anyway, and it can teach regular customers to wait for one.
Were the recovered orders really caused by the reminder?
Not all of them. Shopify counts a checkout as recovered when the customer completes it after the email is sent, even if they came back on their own. A holdout, where a random share of abandoned checkouts gets no reminder, shows how many would have completed anyway.
Why gross profit rather than revenue?
Because the goods in a recovered order still cost what they cost. Taking the reminder costs off revenue, as if the goods were free, overstates what the flow earns by the whole cost of the goods.

Next: what brought those shoppers to checkout?

A reminder closes the sale, but another channel may have opened it. Your GA4 export already holds how long your buyers take and which channels they touch. First finding free, in your browser; the full read is €99.

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