The global cart abandonment rate is approximately 77% and amounts to over $4.6 Billion in lost sales. It is estimated that around 40% of these lost sales are attributed to payment issues experienced by customers at the point of checkout. The optimization of your customer payment process will go towards addressing those payment issues experienced by your online shoppers and ultimately result in increased sales and revenues.
First, Let’s Define Payment Conversion
Payment conversion is a structured system with a systematic approach of encouraging your customers to institute payment for products or services and it’s driven by data and insights.
Importance of Providing Multiple Payment Options
Your ecommerce store should provide your customers with a wide range of multiple payment options so as to cater to a wider market segment that may not be covered by your traditional payment mode.
The essential payment options are Credit and Debit cards, online merchants such as PayPal, Stripe, digital wallets and the growing mobile-based payment systems.
PayPal as a payment gateway for your ecommerce store is highly recommended due to a myriad of reasons: guarantees against fraud, multiple global withdrawal avenues, dispute resolution center among other goodies.
The optimization of your customers’ payment process definitely has an impact on the increase of your sales conversions in your ecommerce store.
Payment Processes that Increase Payment Conversions
We have outlined a number of payment processes that when streamlined can positively impact on your sales conversions leading to an increase in revenue for your ecommerce store.
Have you ever come across a registration process on an online platform with a checkbox with an option of ‘Remember me’ and wondered what it was all about?
Wonder no more. That checkbox option operates using token technology which simplifies an online registration process by allowing you to enter your personal data which may consist of payment particulars only once so that you can re-use that data in future with just a click of the mouse, eliminating the need of you having to manually re-enter that information again.
Ecommerce stores with this feature are able to store their customers’ credit card information on their ecommerce store allowing the customer to purchase items from them without re-entering their credit card details.
This improves the customer experience by saving the customer lots of valuable time, thereby increasing their chances of completing the payment transaction.
Customers come to your ecommerce store because of one thing: trust.
Trust is among the hardest traits to cultivate with your online shoppers because of the very nature of interactions where both of you can’t see each other.
Re-directing your customers to a different platform of which they are not familiar to perform a payment transaction doesn’t sit well with many online shoppers.
Do not lose their trust by re-directing them to other websites to complete their payment transactions. Your e-commerce store should have the capability to handle all payment related tasks.
Cross-selling is the action or practice of selling an additional product or service to an existing customer.
This strategy works best when you cross-sell products that compliment what your customer is purchasing, at the point of checkout.
Example: You can cross-sell a mouse pad if the customer was purchasing a mouse.
Improve Mobile Checkout
Your ecommerce store should be mobile responsive: having the capability of rendering itself perfectly on multiple mobile devices.
You can improve your customers’ mobile checkout experience by:
- Having a simple, well-designed form that is viewable on a small screen: smart phone.
- Your input forms should have minimum fields requiring minimum data input, for it’s extremely cumbersome for most users to input data through a smart phone.
Try and condense the entire payment process into one page, making it extremely easy and user-friendly.
Online shoppers have always attached a high premium on the safety of their personal data especially their financial information. The perception of your e-commerce store security status is crucial in attracting online shoppers and convincing them to transact on your store.
Among the ways of assuring customers that their financial information will be secure is by integrating your ecommerce store with a payment gateway that has a PCI level 1 security status.
Make a point of displaying your security badges and compliance certificates prominently on your ecommerce store as this builds confidence among your potential customers.
Well Designed Checkout Page
Have you ever landed on a website, browsed through their products and services and wanted to purchase them but suddenly something seemed off with the website? It could have been some badly designed graphics, web pages not displaying correctly etc
If the website seems off, customers won’t be eager to input their credit card information on it. Strive to have a well designed, professionally looking e-commerce store as it builds confidence from prospective customers.
A Clear Call-to-Action Button
Well, this might seem obvious but you will be surprised at how many e-commerce stores out there don’t have clear messages on the steps to take when performing payment transactions on their ecommerce stores.
Your e-commerce store should have well-defined call-to-action, clearly detailing what the user is expected to do. Buttons should be clearly marked with what they do.
Guest Checkout Option
Your online shoppers shouldn’t have to register with your ecommerce store for them to purchase items from it. Many customers shun the thought of having to register on websites each time they want to transact or request a service.
Provide a ‘Guest Checkout’ feature that allows your customers to purchase and checkout on your e-commerce store without having to register their details with you. They only have to input minimal necessary information to enable the completion of the payment transaction.
Errors Should Be Easy To Fix
Error messages should be indicated next to the input field with the error.
This makes it easy for a customer to go directly to the field with the error, correcting it quickly without wasting time looking for it.
The most common errors experienced at the checkout section is customers inserting wrong credit card number or bank account numbers.
Top Payment Gateway Providers
Payment gateway providers play a vital role in the ecommerce ecosystem. They provide a secure and reliable way of transferring payment information between payment portals.
Payment gateway providers provide a variety of solutions namely: processing money, verifying client accounts, performing AVS checks, calculating tax returns among others.
They may also allow for modification or the integration of their systems into ecommerce stores by providing developers with APIs, relevant documentation and codes.
Below is a screenshot of the major payment gateway providers currently in the market.
We shall compare the top 3 payment gateway providers, outlining their main strengths.
This online payment platform has established partnerships with a number of industry players within the ecommerce ecosystem such as local banks, credit/debit card firms, PCI council and internet browser providers etc
It has a strong developer-centric culture that encourages developers to create codes that integrate with their system.
Stripe Unique Features
Customized Checkout Experience
Multiple Payment Options:
Stripe offers a variety of services such as the processing of all major credit and debit cards in all countries and providing support of global digital wallets like Alipay, Amex Express Checkout and Apple pay.
Secure Payment Processing
Stripe.js is a innovate security feature that makes Stripe stand out from the rest of the crowd.
It works by sending your credit card details directly to Stripe as opposed to having them stored on your server. Dispute handling and resolutions are automated with the capability of sending evidence in case of conflicts.
Optimized reports and insights
Stripe’s API and Dashboard provide automated accounting and financial reporting that supports the alignment and reconciliation of transactions.
PayPal Payments Pro
This is PayPal’s payment platform for users who don’t necessarily have a PayPal account.
It supports a variety of payment options: credit cards, PayPal credit payments, digital wallets and has an open API infrastructure that can integrate with any shopping cart and marketplace solution.
It is currently the largest payment gateway with an estimated 184 million customer accounts, accepts 26 leading currencies and is available on over 200 markets.
PayPal Unique Features
Doesn’t require payers to have a PayPal account
It was developed to allow credit and debit card payments and rewards from users who don’t have any PayPal account.
PayPal Payments Pro allows the ecommerce retailer to customize their checkout pages and integrations.
They provide a variety of layout designs and colour themes enabling ecommerce retailers to have a consistent branding experience throughout their store.
It allows receiving and sending of mobile-based payments.
Easy money access
It makes the money received on a retailers PayPal account available to them within minutes and provides them with the option of keeping it on the PayPal account or transferring it to their credit card or bank account.
It provides an easy Integration to a variety of ecommerce solutions such as CRM, Accounting systems and major ecommerce shopping carts.
The service is available to both merchants, shoppers and uses the information you entered in your Amazon account.
It charges a fixed percentage of the amount you’re transferring and includes a fully-featured ecommerce suite that helps you promote, sell and manage products and orders.
Amazon Pay Unique Features
Streamlined Purchasing Process
Amazon Pay allows online shoppers to use their Amazon login credentials on the merchants’ site which improves the customers’ shopping experience and decreases their purchasing time. This is because customers aren’t required to enter again their personal data such as shipping address, credit/debit card details etc
Retail – first
Amazon pay was developed and designed with ecommerce retailers who wanted to provide a streamlined shopping experience from login – adding items to cart – paying for the items. It is packed with lots of valuable features that geared toward improving customer loyalty via customizable recurring payments for services.
Secure payment processing
Amazon is globally known for its strict member’s security protocols. Amazon Pay includes fraud detection and merchant protection.
Superior Conversion rates
Amazon is also known for superb customer service as evident in their implementation of the ‘Mayday’ button on their tablets which when pressed was able to initiate a video chat with an Amazon support person.
Providing superior customer service to online shoppers reduces cart abandonment rates for ecommerce stores resulting in increased sales conversions and higher revenues.
No monthly subscriptions/licenses
Amazon Pay doesn’t charge any monthly subscriptions or licenses for merchant accounts.
All fees are transaction-based: transaction fee of 2.9% and an authorization fee of $0.30 exclusive taxes which are charged only when the purchase has successfully been authorized and processed.
All the top 3 payment gateway providers are reputable global brands with millions of users.
The top contenders for the best payment providers are obviously Stripe and PayPal.
Stripe is the new kid on the block. They are fresh, developer-centric and extremely adaptive to changing technologies within the ecommerce ecosystem.
Their customer service is top notch, though we yet see how their customer service will respond to their increasing customer base.
PayPal is synonymous with online payments since it’s been their turf since the late 90s.
It has the largest number of subscribers and outlets, but due to its scale, age and lots of bureaucracy, it’s been taking a beating from newcomers.
PayPal string of acquisitions such as iZettel, Braintree, Venmo, Paydiant, Xoom, Modest among others will be tough to dethrone.
How PayPal increases your ecommerce store payment conversion
PayPal the largest online platform in the world has a variety of tools which your ecommerce store can use to increase its payment conversion.
PayPal Streamlines Checkout Experience
There are many reasons why a shopper may abandon their carts but we can all agree that the more clicks a customer takes to check out, the more chances they have of not completing the ordering process and abandoning the whole shopping experience.
PayPal introduced the express checkout process to reduce the number of clicks for a customer, ultimately increasing conversion rates for e-commerce stores.
The express checkout allows a customer use the payment and shipping information they had set up in their PayPal account during their PayPal account registration.
A PayPal user will never have to enter this information again, no matter what online e-commerce they will shop.
How Does It Work?
Typical Checkout Flow
In a typical shopping funnel, the customer may go through the following steps:
- The customer begins the checkout process from the shopping cart
- The customer enters their shipping information
- The customer enters their payment information
- The customer reviews their order
- The customer submits the order and is then taken to the ‘thank you’ page
It has the same shopping funnel but with a few differences.
- The customer clicks on the ‘Check Out with PayPal’ button
- The customer logs into their PayPal account
- The customer selects their shipping and payment information
- The customer returns to your website and reviews the order
- The customer submits the order and then taken to the ‘thank you’ page
The obvious advantage of using PayPal Express Checkout is the elimination of having your customers’ key in their shipping and billing information manually.
The optimization of the payment process on your ecommerce store ultimately will result in increased sales conversion rates and revenues.
Clove Commerce Insights have a variety of innovative features, geared towards improving conversions
Below are the features that Clove Commerce Insights provides to businesses:
- Simple, lightweight, mobile-friendly interface with predictive recommendations.
- Inbuilt connectors to popular industry platforms and tools
- Advanced Artificial Intelligence technology providing insights of your customer purchase journey
- Automatic secure data consolidation, currency and time zone conversions
- Detailed analytical reports on your customer’s interactions, sales, products, payments and declines.