10 Ways Online Retailers Can Increase Their Payments-Conversion Rate
In a perfect world, in every online shopping experience, your customer would find exactly what he or she wants, proceed through the checkout seamlessly and become forever loyal to your brand. He/she would then return time and again for subsequent purchases.
Well, the world's not perfect, right? More often than not, barriers arise complicating the checkout process, preventing conversions and compromising long-term customer loyalty. So, it's important to do whatever you can to provide a frictionless shopping experience and streamlined checkout for every customer.
The good news is that there are ways to make this happen. Here are ten ways merchants can increase customer conversions and payment acceptance, thereby increasing their customer retention and brand loyalty.
1. Facilitate a frictionless checkout.
Shopping cart abandonment is one of the biggest challenges online retailers face. Combat this problem by creating a less demanding checkout. To streamline the checkout process and ensure a higher conversion rate, require customers to fill out as few fields as possible to complete their purchase.
Retailer ASOS, cited by Econsultancy as having an exemplary checkout, reports that improvements to its form usability ultimately contributed to a 50 percent decrease in abandonment.
2. Provide a branded, hosted checkout.
To avoid situations that will reflect badly on your brand and lead to costly chargeback liability battles, use a payment solution that offers hosted payment fields. This means that the payment fields of your checkout are actually hosted by a payment platform, and any data submitted in these fields is securely stored on the platform’s payment card industry (PCI)-compliant servers.
This minimizes your responsibility in securing the payment and ensures the functionality of the checkout without taking consumers out of their comfort zones -- or your brand experience.
3. Recognize returning customers, with tokenization.
Provide a seamless checkout experience for returning users, with tokenization, a PCI-compliant technology used by Apple Pay and other leading payment platforms. A “token” is a 16-digit number created to represent a credit card that was used or stored previously for payment purposes. When a return customer reaches the checkout and requests to pay, tokenization technology uses the token associated with the customer to recall the stored payment data from the secure servers.
4. Provide transparent fulfillment and delivery information.
Consumers everywhere want assurance that the products they order will arrive intact and in a timely fashion. An effective cross-border logistics solution should minimize the hurdles surrounding international shipments and customs clearance, global order tracking, inventory transparency and international returns.
Customers should be able to see up-to-date information about what’s in stock and what’s sold out, in real-time. They should know, up-front, the time it will take their shipment to be delivered, as well as how to make returns, if necessary.
The Baymard Institute has rated Crate and Barrel "best in class" for its checkout. Econsultancy explains that this is because the retailer's shipping and delivery options are clearly visible, as are estimated arrival dates.
5. Dynamically convert currencies and calculate taxes.
Each country requires different duties and taxes, which must be clearly presented to consumers on the checkout page and accurately reported to the relevant regulatory and tax authorities. A number of third-party vendors offer tax-calculation and real-time currency conversion, allowing taxable international customers to know the exact price of each item they are considering and the full amount they will owe when they check out.
6. Accept multiple regionally preferred payment methods.
Boost cross-border conversions by enabling your customers to use regionally preferred payment methods. This will make foreign consumers feel more comfortable paying on your website. Supporting PayPal is a good start, since it is used for cross-border transactions by consumers and retailers in 57 different countries. However, a truly international business should support the numerous region-specific ewallets in daily use by millions of potential customers. Examples are Alipay for Chinese consumers and iDEAL for consumers in the Netherlands and Germany.
7. Detect fraud to prevent chargebacks.
Proactively implement risk assessment and fraud-detection protocols on your ecommerce site to prevent chargeback impact and fraud. In addition to data-driven fraud technologies, consider integrating solutions that reassign chargeback liability. This means that when customers challenge credit card charges they do not recognize, you are not held accountable for reimbursement in cases of legitimate fraud that the fraud detector has failed to identify.
8. Ensure transaction acceptance, with real-time data.
Today, many data-driven solutions are available that actively monitor and collect transaction information as payments are processed. With this intelligence, merchants can evaluate the efficiency of their payment options from the aspect of decline rates, among other criteria.
By understanding why transactions are being declined, you can proactively make changes to ensure better processing performance. Look for a solution that offers dynamic transaction routing, as well, so your payments technology can detect when and where declines are happening and reroute the payments to financial institutions more likely to accept the payment.
9. Optimize payment acceptance with multiple providers.
If you are a cross-border retailer, consider working with local acquirers to optimize payment acceptance in problematic regions. In the past, working with multiple financial institutions was too complex and required demanding infrastructural changes; but today’s sophisticated payment solutions can enable you to effortlessly connect to multiple acquirers and leverage transaction data -- in real-time -- to dynamically route transactions among financial institutions, significantly impacting acceptance rates.
10. Analyze customers' behavior to match their preferences in the future.
It is becoming industry standard for payments solutions to offer PCI compliance, enabling you to collect and store customer data through your gateway, acquirer or payment service provider (PSP). You can actually integrate a payment technology that analyzes this payment data and gives you insight into inefficiencies in your processing protocols, as well as improved understanding of customer behavior on your website. This data can indicate checkout deterrents, which can be used to cater to customer preferences in the future.