How Merchants Can Take Charge of the Buying Experience
The continued growth of e-commerce worldwide, accelerated by the pandemic, has created a tug-of-war between supply and demand. Product shortages and delivery delays are a new reality, with supply chain disruptions costing organizations worldwide an average of $184 million per year.
Online merchants in the middle of this tug-of-war struggle to control factors beyond their power. The silver lining? After nearly two years of pandemic-induced upheaval, consumers are eager to get back to normal — and they’re doing so with their wallets.
This means the most critical variable of a shopping experience remains within merchants' purview: the buying experience. To take charge, merchants need to focus on customer convenience, improved payment orchestration, and increased conversion.
Focus on Convenience
Convenience isn’t just marketing hype. Nearly 70 percent of online shopping carts are abandoned, with complicated checkout processes and a lack of preferred payment methods cited as common deal breakers. With access and price no longer the only differentiating factors, merchants must enable convenient, frictionless buying experiences that deliver payment optionality.
Consumers have embraced new payment methods like buy now, pay later (BNPL) to free up cash and overcome inflation. Online revenue from BNPL was 10 percent higher in 2021 than 2020, and 45 percent higher than in 2019. Complex and continually changing payment methods also exist from apps such as PayPal, Apple Pay and Google Pay, to platforms like Stripe, Adyen, and Braintree, and regionally focused services like Alipay, PayTabs, and iDeal that merchants must accommodate.
While adding new payment services and options is a must, many connect to back-end systems through discrete APIs with few designed to work alongside one another. This lack of easy integration forces merchants to build back-end infrastructure and front-end functionality that stitches payment methods together.
Improve Payment Orchestration
Payments orchestration offers an answer to integrate and manage various payment services. More than ever, merchants should select a payment orchestration platform (POP) that brings together diverse payment methods and services.
The right POP will depend on the business's specific requirements and priorities. However, the best POP will supply end-to-end visibility, management and automation of all transactions and deliver a seamless checkout experience regardless of consumers’ payment preferences.
A few attributes should also remain top of mind. An optimized POP will take advantage of cloud enablement, bringing together diverse payment infrastructure and services — both on premises and in the cloud — and provide a single, cloud-based control layer that meets current and future needs. It will comply with country-specific laws and regulations and evolve with changing privacy, data and commerce requirements to help online merchants nimbly adjust to shifts in currency values and exchange rates. The right POP will also provide simplicity regardless of scale, allowing online merchants to focus on front-end payment orchestration instead of back-end technology integration and administration.
Increase Conversion Rates
It’s important to note that e-commerce sites and merchants can increase their conversion rates by more than 35 percent simply through better checkout design.
Checkouts can be complex, so the POP a merchant chooses needs to optimize conversion rates at a cart level and at checkout. The right platform will advise and recommend how to increase sales and decrease costs as an e-commerce business grows and expands. Payment optionality is crucial here, as offering varied payment methods and services customers demand has shown to increase conversion rates.
Therefore, while online merchants can’t avoid the supply chain issues dogging the industry, they can impact the consumer buying experience. By prioritizing convenience, offering new payment methods, and optimizing checkouts for increased conversion, merchants can ensure a positive experience for their customers.
John Lunn is the founder and CEO of Gr4vy, which provides cloud-native infrastructure for managing payment methods, services, and transactions.
Related story: How to Grow and Thrive by Supporting New Payment Methods
John Lunn is the Founder and CEO of cloud payment orchestration platform Gr4vy. He is a technology and fintech entrepreneur with 21 years of experience working and investing in financial services, commerce enablement, e-payments, data, security and infrastructure. Lunn worked as the Director of Technology for six years at CyberSource, the world’s first payment service provider, which was sold to Visa for $2Bn in 2010. He then helped found Passmark Security which was sold to RSA Security in 2006.
In 2006, Lunn joined PayPal as the fourth employee in the UK (now 2,000+), where as Global Director of Developer and Startup Relations, he built and grew PayPal’s first Developer Relations team. In 2015, he was instrumental to the purchase of Braintree by PayPal and joined the team. In 2016, Lunn was part of the team that launched PayPal Ventures, the venture capital arm of PayPal, a $350m fund with backing from the Board. Lunn was a Board Observer for Dosh, Arkose, Raise, Acorns, Toss and many others.