Last editedOct 20212 min read
When you’re setting up an online retail business, it’s all too easy to neglect the importance of payment methods. Many companies see this simply as a basic component that needs to be added to process transactions, but fail to consider the different online payment methods that they can offer. As technology grows and customers become more digitally literate, a number of alternative payment methods are becoming popular, such as mobile payments or digital checkout online.
For this reason, if you want to grow your e-commerce business, you should think carefully about consumer payment preferences and how you can respond to these. That’s where payment processors come in. Keep reading to find out more about the different online payment methods on offer, and how these can impact your business growth.
Why are payment methods important to online business growth?
You might think that offering credit and debit card payments is enough for your e-commerce customers. However, research is showing that more and more consumers are opting for alternative payment methods, and your business should respond to this if you want to keep these customers.
The checkout page is possibly the most crucial part of your e-commerce business – this is where window shoppers can be converted into paying customers, and therefore revenue. So, you want to make this step as easy as possible for the shopper so that they can easily make payments. There are a number of elements to this, including intuitive design and simple forms, both of which can prevent shopping cart abandonment. In addition, you should offer the payment methods that are convenient and comfortable for your consumers, which may vary according to your business type.
Choosing the right partner for payment processing
If you’re trying to encourage online business growth, it’s essential to find the right payment processor for your business. There are many different options available, but if you’re operating a startup or small business then you should find a payment processor that specializes in assisting small businesses. Unlike the larger companies, these payment processors will be able to offer you tailored solutions to your needs and business growth strategies.
On the other hand, if you’re a larger company or aiming for global expansion, then bigger payment processors may be more suited to your needs. They will understand the challenges of global business and can advise you on the best ways to accept international payments.
What alternative payment methods should I offer?
It’s clear that you should offer standard payment options, such as credit and debit card, but what alternative payment methods should be part of your business growth strategies? The answer will depend on the specifics of your business, so the best way to find out is to do some market research through customer surveys and questionnaires to find out about your customers’ preferences.
Having said that, there are some general trends within e-commerce. Customers are moving towards innovative digital payment methods due to their increased security, ease of use and flexibility. Some of the better-known methods include providers like PayPal and Apple Pay that allow customers to quickly make payments using just their login information. In addition to this, e-wallets and bank transfers are becoming increasingly popular payment options.
Another consideration is whether you should offer “buy now, pay later” to your customers. Companies such as Klarna offer a way for your customers to spread the cost of their payment over several interest-free installments, and this can be an attractive option for them, particularly when it comes to expensive purchases. The downside of this is that these companies take a percentage of your revenue, but this loss may well be worth it considering the increased sales you could make.
We can help
GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.