Mihails Shafro, xpate CEO, dives deep into how sellers can optimise payment experience to deliver a great shopping experience to customers.
The pandemic has changed the trading landscape and made many merchants move into e-commerce, and rightly so. McKinsey & Company reported that in Q2 2021, figures for cross-border shipments and product volumes surpassed previous years’ results. E-commerce adoption spiked around the globe – a 57% YoY rise in outbound e-commerce in the UK and 42% growth in November alone are the ultimate indicator of a pinnacle this industry hasn’t reached before. Furthermore, that means consumers are no longer picky – the merchant’s location no longer plays a significant role in a final buying decision.
The opportunities for merchants are now enormous. Entering new markets is no longer an obstacle. However, with lower entry barriers comes stricter competition and higher expectations. Customers are used to a great shopping experience that encompasses high delivery speed or convenience. That’s an obstacle for newcomers – a competitive marketplace does not tolerate outdated habits. Payment data and its further analysis take a leading role in attracting new customers and generating sales leads. However, the prospects are promising for anyone wishing to try themselves in the new regions and adapt new practices.
Study Regulations
Every region has its rules, and merchants must remember that. Take Europe with its Strong Customer Authentication (SCA) under PSD2. Let’s break it down.
SCA requirements demand every transfer over €30 to run through a two-factor authentication in the European Economic Area (EEA). The rule aims to combat fraud for Card-Not-Present (CNP) online sales through user identification. While the practice is all about security, it forces buyers to pour extra time and effort into measures like one-time passcodes. If such features fail to operate smoothly, customers can abandon the shopping process and turn to competitors.
Fortunately, the technology positively affects the e-commerce landscape, and 3D secure is one of such solutions. Its new version, 3DS 2.0, delivers a ten-fold increase in data exchange speed between customer and seller, meaning the overall payment process can be optimised to the needs of both parties. This, in turn, decreases fraud rates.
3D Secure offers a lot of perks to the merchants, such as a higher rate of lead generation and frictionless payments flow. Yet, it’s essential to pick a right payments provider that can help utilise the technology to get all its benefits and offer a great shopping experience to consumers.
Speak Your Customer’s Language
Universal solutions make e-commerce a vibrant and fast-moving space, but they aren’t always the most fitting. After all, region specifics play a great role in choosing payment solutions. To be on top of the game, the merchants must know such specifics. Take a look at the Netherlands – 59% of all transfers go through the IDEAL app. In Italy, PayPal and PostePay remain the most used payment methods for online purchases.
The moral of the story is fairly straightforward – before moving into new markets, run a thorough analysis and identify the most popular payment methods and make sure you have them in your portfolio. Regional consumers have no obligation to change their tastes, and merchants must adapt accordingly. No matter the region of your choice, the right payments provider is the key to help merchants understand each region’s preferences and implement the appropriate payments methods.
Finally, the language is a huge deal. Would you run an English-only marketplace in Japan or Lebanon? Probably not, and rightly so – customers feel much more comfortable shopping on the platform supporting their language. After all, some customers have limited English proficiency – pushing them towards using an online translator is a way out of the regional e-commerce game with skyrocketing rates of abandoned carts.
Optimise the payment experience for mobile
With 86,05% of shopping cart abandonment rate, mobile optimisation remains the weakest spot for e-commerce merchants. Global e-commerce sales are projected to reach $3.56 billion, which means e-commerce sellers are missing huge profits when not offering mobile solutions to customers.
It’s clear that mobile optimisation is essential to reduce cart abandonment rates. However, it doesn’t end there. Merchants must remember that a proper layout with as few purchase steps as possible is the key to success. For returning customers, it is wise to enable tokenisation so that, customers wishing to buy more later can come back and click one button without inputting details again. Finally, allowing different payment methods is crucial. That includes e-wallets like PayPal and mobile wallets like Apple Pay or Google Pay.
Know Your Customers and Their Interests
Opportunities in e-commerce for merchants are huge and incomparable to the past. However, while cross-border trade is a land of hope, it’s also a place with intense competition and high expectations. Merchants must know their customers in and out, adapt to the changing environment, learn regulations, and localise the payment process.
At the same time, by being on top of all that, merchants have a great chance of succeeding. In such a promising environment, it’s worth giving it a shot.
