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Peak Payments Conversion: How to Convert More Users Into Buyers

Andrew Monroe
Head of Gaming and Media, Ingenico

During the COVID-19 pandemic, the demand for digital goods and services has exploded as businesses have been forced online and customers have been shopping safely from home. Most of us have experienced a much higher number of video calls replacing face-to-face interactions; even birthday parties and weddings ceremonies are happening via video. The digital conference tool Zoom experienced a huge spike in use on a single day in April, with 300 million people using its services.

Consequently, digital businesses are now reaching a critical mass, with demand coming in from new demographics and geographies. And payments are playing a critical role, enabling businesses to open up new markets and optimize potential from existing customers.

So, in this article, I’ll explain the key areas for digital companies to consider in order to reach what we call “peak payments conversion.”

Expanding into new territories

Thanks to the proliferation of online shopping, trade agreements, and delivery networks, cross-border payments are simpler than ever. And with companies increasingly embracing their digital capacity, they’re discovering the incredible possibilities and challenges cross-border payments offer.

With consumer payment preferences varying across the globe and cultural differences affecting the way people prefer to shop, how consumers choose to pay and the currencies they use must be taken into consideration when enabling cross-border payments. Businesses must also integrate with local payment networks and financial institutions that allow these payments to take place.

The current rapid digitalization of commerce means it’s the perfect time for businesses to consider how they can localize for different geographies. As a result, it’s more important than ever for digitally native businesses to have a payment partner, with a global acquiring network, that they can trust to handle their cross-border payments, while ensuring that the entire payment experience is familiar and easy to use.

Local payment methods are key

Research by Ingenico shows that “up to 42% of customers are likely to drop off and search for an alternative website if their preferred payment method is not offered at the checkout.” That’s a huge percentage that leave because they prefer and trust other ways to pay.

Furthermore, if customers have a bad experience and choose not to complete a payment with your business, they’re unlikely to return. But when you provide the payment methods your customers prefer, catering specifically to the region they’re in and the devices they use, they’re more likely to convert.

Payments and the right business model

In recent years, the subscription model has grown in popularity, especially for goods that were previously purchased on a one-off basis and sometimes it’s not the item itself that’s been digitalized, but the method of payment. An example of this is subscription boxes where goods are delivered to customers’ doors rather than being procured physically.

What’s more, with COVID-19 making customers increasingly comfortable with new payment methods – such as older demographics warming to online payments – this trend will likely continue and the adoption of digital payments will increase.

There are trends this year that demonstrate this change. eLearning companies have experienced a sudden increase in demand, with education app downloads rising by 90% in March. Also, Netflix hit 183 million subscribers in Q1.

Performance analysis and taking control of your data

With these new business models in place, optimizing conversion rates is a must and the user experience is a key component to ensuring that customers follow through with payments. Any friction during this process can result in customers dropping off.

Fraud management that is too strict can contribute to this friction, so businesses must get the balance between security and conversions rights. What’s more, if businesses don’t have the relevant acquiring partners and capabilities for a given region, they’re going to run into authorization and remittance issues.

Therefore, businesses must understand what’s affecting their conversions and performance analysis and take control of data is key to achieving this. There are 3 key components to this process:

  • Diagnose – Analyze data points across the payment experience and build a clear understanding of what helps and hinders conversion.
  • Act – Set measurable objectives and thoroughly test different potential solutions to improve the payment experience.
  • Monitor – Organize reviews to continuously maintain and improve KPIs.

Reaching peak payments conversion

So, by making the most of cross-border opportunities, localizing successfully, and exploring appropriate payment models, online businesses can reach the conversion rates needed for growth during this time of digital acceleration and increased competition. However, alongside all of this, they must be aware of fraud in the online space and equip their businesses with the tools needed to protect themselves.

To ensure customers remember experiences and not transactions, it’s important to streamline the payment process, whatever your business model. Get it right, and you can delight customers. Miss the mark, and you risk lost revenue.

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