The pandemic has changed the way customers and businesses interact. And with online spending in Europe expected to jump by 30% in 2021 compared to before the pandemic, that change is here to stay. As a result, optimising your presence across all channels – both in-store and online – will be crucial to keeping up with your customers.
Here, we want to talk you through how to optimise your online payments specifically. While many SMEs dedicate a lot of effort to beautiful and frictionless online marketplaces, the payment process – i.e. what happens after items are in the customer cart – can sometimes get neglected. But when as many as 75% of customers abandon their cart during payment, payment completion isn’t something you should be taking for granted.
In this article, we’re looking at four ways to optimise your online payment – both for you and your customers. We’ll explore four key things: user experience, security, managing international transactions, and back-end authorisation.
Along the way, we’ll introduce you to CCV’s online payment services. Thousands of businesses already know how CCV can make your payment processing simpler.
The Payment Pathway
Before the how, let’s start with what you need to optimise. The payment process involves you, your customers, and different financial players that make payment happen and keep everything secure. Here’s what the process looks like:
- The customer journey. A customer chooses a product online, puts it in their cart, and heads to the checkout. That’s when the payment process starts.
- Authentication. You need to make sure your customer is who they say they are, through strong customer authentication (SCA). During payment, customers are obliged to show two forms of identification: a PIN or password; a card reader, email, or mobile phone; or biometric data, like fingerprint or voice recognition.
- Behind the scenes. This is the part your customers won’t see. Your acquiring bank will tell the customer’s issuing bank the details of the transaction. The issuer will ensure the customer has sufficient funds and that there are no signs of fraud. If it all looks good, they’ll authorise the payment.(This can get complex. If your business operates in different territories, you may have relationships with lots of different acquiring banks. Using a payment service provider like CCV can help keep things simple.)
- Back to the customer. Finally, the customer will have their payment confirmed – or declined. If declined, they may make their purchase elsewhere or try again later.
Optimising your online payments will mean making life easier for your customers, while streamlining the ways you manage payments.
So, let’s see how you can make that happen.
Optimising the Customer Experience
Online payment starts with the customer experience. According to research from the Baymard Institute, an unsatisfactory experience is the single biggest reason why customers don’t finish the payment process. Things like over-complicated checkout processes and website errors get in the way, and cause abandonment.
On the flipside, though, they concluded that brands could increase their web conversions by over 35%, simply by improving their payment design.
So, how can you strengthen your customers’ experience?
- Firstly, keep things brief. The more steps and complications you include, the more time customers have to get second thoughts.
- Achieve consistency in branding. Keep your customers onsite – rather than redirecting them to a third-party page. This way you ensure the payment environment is functional, trustable, and on-brand.
- Deliver clarity on orders. The Baymard Institute (mentioned earlier) suggests over 60% of cart abandonments happen because customers can’t see full costs up front. Being clear and honest about delivery, tax, and processing fees builds trust and prevents last minute frustration.
- Promote trust through effective visuals. Using labels and icons in data fields promote easy interaction, while progress bars and check marks encourage customers to continue. Design elements like your PSP’s logo deliver a sense of confidence too.
- Ensure checkout compatibility across devices. 72% of online sales will be completed on mobile across the world in 2021, according to some estimates. If that’s not a reason to ensure your payment pages fit on every screen, we don’t know what is.
Ultimately, customers want a functional, clear, and convenient payment experience. Optimising your payments so it delivers exactly that will help get them over the line.
Balancing Security with Friction-Free Payment
Now to the second stage: authentication. A quarter of Europeans are concerned about their financial information being misused online, while a lack of trust in website security remains a significant driver of cart abandonment.
Optimising your online payments means delivering the security your customers demand.
And your job as a merchant is to find a balance between strong authentication and frictionless processes for everyone. Here are some ways you can get it right:
- Remember, some friction is necessary. SCA means that most customers need to be authenticated, unless transactions are very small or otherwise exempt.
- Enable one-click payment. The “tokenisation” of payment card data makes for quicker transactions, as customers don’t need to be authenticated on return. Heads up: CCV’s PSP services let you recognise customers across all touchpoints – making payment easier online, in your app, or in your store.
- Allow secure guest checkout. As many as a quarter of customers abandon their purchase if it means creating an account. Providing a secure payment route for these customers through SCA can boost your conversion rate while maintaining security.
- Accept digital wallets. Digital wallets like Google Pay, Apple Pay, and PayPal make your life easier as a merchant. Simply, they handle authentication for you in-app, and can offer customers more payment options too.
Welcoming a Global Market
We live in an increasingly interconnected world. While this provides massive opportunities to even the small businesses, it also throws up some challenges – particularly when it comes to payment. To optimise your payments fully, make them accessible to all of your customers, wherever they are in the world.
So, how can you make sure your online payments don’t get in the way of your international reach?
- Localise everything. According to CSA Research, 40% of consumers are squeamish about buying from sites that aren’t in their native language. That means your payment page as much as your online storefront. Meanwhile, if your delivery address field only accepts UK postcodes, or Dutch phone numbers, you’re saying goodbye to willing customers who want to buy from you.
- Accept a range of payment methods. Not everyone in the world uses Visa or Mastercard. From country to country, different customers prefer PayPal, bank transfers, Girocard, QR payments, or things like iDEAL and Satispay. Offering them all optimises payment for every customer.
- Avoid currency exchange headaches. According to Payvision, 45% of customers are uncomfortable about purchasing in a different currency. Working with a payment service provider can make handling lots of different currencies easier for you.
Now to the last part of the payment process: payment authorisation. Don’t underestimate it. Declined transactions will threaten your conversion rate and cause customers to go elsewhere.
Payment authorisation is a crucial part of your bank’s fraud defences. So, you can’t ever eliminate declined transactions entirely. But you can boost the authorisation rates of legitimate transactions, and that can help keep conversion high.
- Get data on when, where, and why transactions are declined. Decline codes from issuing banks can provide insight into recurring authorisation problems. Getting serious about optimising your online payments means understanding these patterns.
- Schedule payments for days with fewest declines. For future bookings and recurring payments, for example, you can decide when payments are processed. Scheduling payments for days with lower decline rates can ensure more frequent authorisation.
- Manage international transactions. Most declined transactions are those that happen across borders. Using local banks or multi-currency PSPs (like CCV’s) will help.
The Benefit of a Payment Service Provider (PSP)
Of course, you don’t need to handle all of this complexity yourself. A payment service provider (PSP) is a company that receives, authenticates, and processes electronic payments through multiple channels on your behalf.
That frees you up to deliver value to the rest of your business, and keep growing.
CCV’s PSP services allow you to handle multiple currencies, payment methods, and in-store and online channels all in a single place – while boosting security and reducing the chance of authorisation declines. It reduces your admin too, as you won’t need multiple points of contact or agreements with acquiring banks. We’ll be the only touchpoint you need.
With CCV’s PSP, you can optimise your business processes while offering greater payment options to your customers. Find out more.