The payment methods you offer (and how you offer them) can have a huge impact on your eCommerce conversion rate. And, since it’s much more efficient to convert the site visitors you already have rather than attract new site visitors, you should try everything possible to keep your conversion rate as high as possible.
In this blog, I’ll look at three areas of an eCommerce payment system that can be tweaked to improve your conversion rate.
Area #1 — Site Security
With data breaches and dodgy privacy dealings in the news almost every week, consumers are getting more concerned with their online security, especially if they’re handing over personal or financial details.
Now, when we’re talking about site security and conversion rates, we’re really talking about two different points.
First, you’ve got to make sure that your site is actually secure. For some basic security information, read through the PCI Security Standards Council’s website. It’s really helpful and you don’t need to be a web security specialist to understand what’s going on.
Second, you’ve got to communicate to your site visitors that you take security seriously.
One of the most effective ways to do this is by using trust badges, which are little virtual badges issued by security companies and payment companies to indicate that your site meets a minimum level of security.
Some of the most popular ones include:
- McAfee Secure
- TRUSTe Certified Privacy
- PayPal Verified
- Norton Secured
Use these badges throughout your site and highlight them during your checkout process. This lets your customers know that you take security seriously and helps convince them to trust you with their payment details.
Area #2 — Payment Options
Once upon a time, the retail sector was dominated by cash. However, nowadays, things are different.
The growth in online business, the proliferation of card payment terminals and the emergence of contactless technology have pushed card payments to the top of the payment method leaderboard, relegating cash to a paltry second place.
Alongside card payments, there’s also a new group of left field payment options called ‘alternative payment methods’. This is basically anything that doesn’t involve a credit or debit card.
Worldpay estimates that there are over 200 alternative payment methods available at the moment, ranging from direct debits and digital wallets to digital currencies and e-invoices.
With so many payment options out there, it’s essential that you offer the payment methods your potential customers want to use. If they find that they can’t use their preferred payment option, they’ll probably go elsewhere.
Before deciding on a range of payment options, I recommend you talk to your customers and asking how they wish to pay. Then make sure you support those payment options during your checkout process.
Area #3 — Payment Gateways
First up, let’s talk about payment gateways. If you’re not that digitally savvy, a payment gateway is the bit of tech that allows your eCommerce website to actually process credit and debit card payments.
Technically, there are two flavours of payment gateway.
Hosted gateway: Hosted gateways are hosted by the company that provides the payment gateway. In order to process a payment, your website has to redirect a user away from your website to the provider’s site, have them enter their payment information and then redirect them back to your site for confirmation.
Shared/Direct gateway: A shared or direct gateway is one that you can integrate into the checkout process on your site. So instead of redirecting a user to a different website to enter their payment details, you can accept them directly into your site.
While hosted gateways do have a bunch of benefits, the key advantage is security. Because the provider hosts the page where your customer actually enters their payment details, they shoulder a bunch of the security responsibilities.
However, hosted gateways also have one big disadvantage: they kill your conversions.
Since you have to redirect users away from your site, you’re making them think twice about whether it’s safe to enter their details and whether they really want to complete the purchase. And that slight hesitation is all it takes to take a chunk out of your conversion rate.
While shared gateways mean you shoulder a bunch of security concerns, they are great for conversions as your customer can complete the full transaction on one site.
About the Author
Stephen Hart is the former CFO of payment processing company Worldpay. He is now the CEO of the UK’s first card processing comparison site, Cardswitcher.