Building the right payment system is a critical aspect of developing a successful direct to consumer (D2C) channel, but optimizing your payments strategy is easier said than done. It’s part art as you try to offer alternative payment methods that streamline the buying process and add a layer of security, and part science given the need to route transactions to the right place at the right time to increase authorization rates. So how can you make sure you’re getting payments right?
As part of our Uncertainty into Opportunity live virtual event series, we invited a panel of ecommerce experts for a discussion on that very topic. Titled Optimize Payments for Maximum Conversions, the event was sponsored by Blue Acorn iCi and speakers included:
- Chase Bruch, Director of Analytics and Optimization, Blue Acorn iCi
- David Bruce, Senior Director, Global Partner Development, PayPal
- Jeremy Waxman, Head of Payments Strategy, Digital River
- Mike French, Vice President of Partnerships, Digital River
Here are some of the most important insights shared by the panel on how brands can optimize payments for their D2C channel.
You can also view an on-demand version of the webinar here.
More isn’t always better
Some companies believe they can optimize payments simply by adding more payment methods to their ecommerce store. They think that by offering more options, they can capture more customers and increase conversions. But this is a mistake.
While it’s true that customers want to see their preferred payment methods and local currency used online, presenting too many options can actually hurt your conversion rate as the options become overwhelming and the buyer’s journey becomes muddled. The key to optimizing payments then is not about adding more payment methods, but finding the right ones for your customers and your company.
It’s critical that your brand thinks about payments not just in terms of the customer experience, but how complete payment systems will impact your bottom line. The way you accept, process, reconcile and manage payments will vary with each payment method you choose, and you need to make sure you have the proper back-office processes in place for each one.
Failure to have the right processes in place can cause a litany of problems and ultimately make you less profitable than you otherwise could be. So, when looking to optimize payments for global conversions, make sure you involve accounting, tax and compliance personnel in the process early on so you can build complete payment systems for every payment method you offer.
Analytics as a path to optimization
At the end of the day, optimization is all about figuring out what works and then devising strategies to increase those behaviors and outcomes. That’s why Chase Bruch from Blue Acorn iCi said he will often start with the payment and then work backward through the buyer’s journey to identify opportunities for optimization. By using analytics to unpack each stage and influencing factor in the buyer’s journey, you can better understand what works for your customers and refine the experience to improve conversion rates.
“You can take the payment processor as sort of an origination event, and then paint the picture of how people behave differently based on what they used,” Bruch said. “Analytics is critical, and it’s become a necessity in optimizing and driving the decision making you want to take against payment processors.”
Payments as part of the shopping experience
While payments data can be used to shape the shopping experience, you also need to consider payments as a critical component of that experience, not just a final destination. While not pertinent in all situations, incorporating payments information into other stages of the buyer’s journey can help eliminate barriers to conversions. For example, including information about financing options on the product page for high-ticket items can remove uncertainty for shoppers about their ability to pay for the item. This can help reduce abandonment and eventually drive more sales.
The key is to look at payments in a holistic manner, understanding how payments influence conversions, how they impact the overall customer experience, and what you can do to reduce friction for buyers. By optimizing your payments strategy in this way, you can improve your conversion rate and increase revenue for your D2C ecommerce channel.
More to learn
Our experts had more insights to share than we could capture in a single event, which is why we recorded a podcast immediately following our panel. You can listen to the podcast episode below, and then be sure to subscribe to our Commerce Connect Podcast to hear more industry leaders discuss their tips and tools for global ecommerce success.
To learn more about how you can create successful ecommerce strategies for your D2C channel and prepare for the upcoming holiday season, be sure to join us for our next live virtual event in our Uncertainty into Opportunity series titled Could Your Brand Survive an Online-Only Holiday Season?