The e-commerce sector is booming, with more than 2.1 billion global consumers now shopping online. And, in even better news for online retailers, a growing number of those transactions are cross-border payments, making for a market worth $1 trillion.
As merchants step onto the global stage, there are a wealth of opportunities to be had, offering an almost limitless customer base and huge expansion potential.
How to Track Your Customer’s Journey
With such huge growth volumes and fierce competition in the online sphere, it’s getting harder to stand out on just price alone. As more entrants jostle for space, profit margins shrink even further, putting more pressure on time-pressed merchants.
It takes more than a dazzling website resplendent with all the virtual eye-catching gimmicks and promotions to garner sales. Have you paid any attention to your customer’s online journey? How easy is it for your customers to buy what they want with the payment method they prefer?
And, if you’re selling cross-border, you have bigger issues to contend with. Your customers aren't limited by borders when shopping online. They expect to see pricing in their local currency, and products described in their own language.
Merchants often underestimate the impact that well-managed payments can have on their business’ bottom line. This lack of understanding bites directly into a merchant’s acceptance rate, particularly when it comes to international transactions, which tend to have much higher decline rates than local payments.
Merchants wishing to take advantage of a marketplace that stretches from Antarctica to Australia need to understand that maximizing acceptance rates is critical to the success of their international business.
Drilling deep into your transaction data could unlock the cause of your declined payments — and open up a goldmine of cross-border sales.
Minimize Declines for Maximum Approvals
Even a slight improvement in acceptance and approval rates can have a massive impact on the performance of your transaction funnel, much more so than many other business improvement processes. In fact, increasing approval rates by just 5 percent can boost revenues by as much as a fifth.
Advanced analytics and data modelling ingenuity can be used to determine transaction profitability and identify and resolve issues in the approvals process. It could be as simple as your fraud rule sets are so tight that they’re blocking legitimate transactions from abroad. Or your customer’s card issuer may not recognize your acquirer.
The great news is that merchants don’t have to become the Sherlock Holmes of online transaction declines by themselves. Working with the right payment service provider, with a dedicated team of analysts, can pinpoint any issues in your entire transaction funnel.
That includes data from the cardholder, payment gateway, card scheme and issuer to investigate why transactions are being declined. Merchants should also have access to detailed, real-time 24/7 monitoring and analysis, including easy-to-use data dashboards, and dedicated account managers who know the merchant’s business inside out.
Detecting problems as early as possible in the payment process minimizes declined transaction rates, boosts approval rates, and generates a wealth of business intelligence. Not only that, but armed with the right data tools, merchants can get a clear picture of their customer’s payment journey from start to finish — with the power to remove any obstacles on their way to the "Pay" button.
Igal Rotem is the CEO of Finaro, a payments company providing simple, multidimensional, tailored global payments solutions for merchants and partners.
Related story: 3 Tips to Delight Cross-Border Shoppers This Holiday Season
Igal Rotem is a seasoned high-tech executive and serial entrepreneur, former founder and CEO of a publicly traded (NASDAQ) company, with extensive business development, sales management and strategic business planning skills. He successfully spearheaded companies through entire lifecycle stages: start-up, accelerated growth, turnaround, IPO on NASDAQ, joint venture, and finally through acquisition.
Since mid 2010, Rotem is the executive chairman, CEO and board member of Finaro Inc. (Aka Credorax), a global payment company and a bank providing payments to eCommerce cross border companies.