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Online retailers are dramatically losing out on sales by failing to address customers’ preferred payment methods. Our recent research shows that 68 per cent of UK consumers have abandoned an online retail site due to the payment process.
Over half of these (57 per cent) left because the process was too complicated, while 46 per cent didn’t complete the transaction as the merchant didn’t offer them their payment option of choice. This demonstrates to us that to succeed online, merchants must consider an omni-payment strategy to keep customers happy and maximise sales.
Cultural differences also play a key part in the transaction process. For example, the preferred payment method for UK consumers is PayPal (45 per cent), followed by credit cards (22 per cent) and debit cards (23 per cent). In the Netherlands however, almost two-thirds (65 per cent) of all transactions are carried out using the iDEAL online banking system and in Germany and Austria most digital buyers prefer payment on account and via direct debit. By failing to understand the preferences in each country, merchants can lose sales, with nine out of ten (92 per cent) of UK consumers not happy to pay via a method they had not heard of.
So, by facilitating and accepting international payments in multiple methods, online retailers can open the door to more international business, expanding their reach globally. The first step to achieving sales and ensuring customers carry out their purchase is for merchants themselves to understand the culture of payments. The customer-facing website can be beautifully designed, with quality products and easy to navigate but all this is pointless if when the customer reaches the checkout, they refuse to complete a transaction due to a lack of payment options. Our research has shown that consumers also expect variety when it comes to payments with 88 per cent of UK consumers expecting to have the option to pay by a number of means when they shop online.
Merchants need to accommodate this and offer alternative methods. If payment options are limited, so are sales opportunities. By removing the boundaries and complexities of international electronic payment processes, consumers can ultimately buy what they want, where they want and how they want, increasing opportunities for merchants. If these barriers are not broken down the ramifications can be severe.
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