Continued success and customer satisfaction in the world of e-commerce requires constant effort to grow the reach of your brand. The latest strategy to grow reach and take the e-commerce world by storm is alternative payments. While alternative payments aren’t a new feature, they’ve gained momentum over the past few years as more consumers turn to online shopping and expect to see their preferred payment method. Online merchants can therefore capitalise on the growing momentum of the e-commerce industry by offering alternative payment methods. This especially holds true in emerging markets, like the ones where PayU operates, because not everyone has access to credit cards.
Essentially, alternative payments are any payment method besides a credit card. So, if you have yet to embrace alternative payments, or are thinking of expanding your current options, here’s why more consumers are embracing alternative payment methods and what the benefits to your business are by offering them.
Encourages sales
Shopping carts often get abandoned because the final amount becomes too expensive for the consumer to pay at once. According to a recent study undertaken by FuturePay, 72% of respondents mentioned that the reason they abandoned their cart was because the order became too expensive. The good news is that merchants can overcome this challenge by offering an alternative, in the form of credit or customer financing. The customer is allowed to pay for the product over a specified time, instead of all at once, at a low or interest-free rate, and the merchant makes a sale of an item that would normally be discarded from the cart. 73% of the daily online shoppers surveyed mentioned they would be more likely to purchase an expensive item if financing options were available. So by offering a form of payment that allows customers to pay over a certain period of time will increase your chances of gaining new customers and the amounts that existing customers spend.
Speeds up checkout
Checking out can often become a source of frustration to online shoppers if the process requires them to enter numerous card details or personal information every time they checkout. As security of personal information still remains a fear for many customers, offering alternatives that don’t require the input of personal information during every checkout will significantly decrease the checkout time and offer a more customer-friendly experience. According to Business Insider, in 2016 46.1% of cart abandonments happened at the payment stage and 37.4% happened at the checkout login stage. Merchants can tackle this challenge by offering alternatives that don’t require the entry of personal and card information, streamlining the process for the benefit of customer experience. Many e-wallet and one-tap payment methods can resolve this issue, as well as credit products like Lazy Pay available in India through PayU, that allow the consumer to pay now and enter their payment details later.
Gives customers more options
While this is an obvious benefit, it is an important one. As more and more consumers turn to online shopping, more will expect to see their preferred payment method offered. If your store doesn’t offer their payment choices they will easily switch to one that does. Of the respondents in the FuturePay survey, 26% mentioned that not finding the payment option they were looking for was a concern. While offering credit card payments only sounds simple to you as the merchant, if you operate in various countries, you might be eliminating customers who have different local methods and preferences. In PayU markets, as many as 50% of the population does not have a credit card, these consumers still want to engage in online shopping, but need additional payment methods such as cash, bank transfer and others to pay for their online purchases. Therefore, alternatives are required, and must be offered in order to grow the potential for more sales.