Much of our test has shown that you need different payment methods to achieve a good conversion rate. People are mainly looking for shops that offer their favorite way of paying, otherwise you will go to another one.
For some, picking up an identifier is already too much to pay with iDeal, others do not dare to pay online with their credit card details or with Paypal. Something for everyone, and you have to support the shopper here.
In our webshop marketing masterclass we give a lot of tips for getting more traffic to your webshop, but that traffic is meaningless if you can’t convert it into paying customers.
In this post we'll cover:
How does having more payment options affect conversion rates?
Conversion percentages are numerical values to indicate how many of your potential customers continue to place an order on your e-commerce website. It is the percentage of the total visitors that ultimately pay you. Many online retailers focus on increasing traffic to their site in an effort to increase their sales.
However, you can also optimize your conversion rate by improving the number of payment options you offer to your potential customers. It’s much easier to double the number of sales from the customers who already visit your site than it is to double the number of visitors to your site.
Make it easy for online shoppers to checkout
By offering a variety of payment options, you make the customer’s life easier. The more difficult your website is to use and the more obstacles there are, the more people drop out of the checkout action. For example, in America most customers use their credit card, but here not everyone has a credit card or wants to use one. And while some customers may be comfortable using their credit cards online, others would prefer other methods of payment.
It is therefore also wise to adjust your payment methods to the different countries in which you operate. For example, the Netherlands has iDeal, but you will not convince a Belgian with that, then you also need Bancontact / Mister cash.
There is certainly no shortage of alternative payment choices available from recognizable brands such as Visa, MasterCard, Google Wallet, and of course eBay’s PayPal. In the meantime, new alternatives such as Bitcoin have also emerged. In addition to the digital wallet, in addition to Visa and MasterCard, other payment methods are also available that online stores can use, such as accepting, for example, reloadable prepaid cards, verified payment or virtual account numbers, Alipay and Amazon Payments.
Why should you offer multiple payment methods?
If you don’t offer several payment methods, you could lose the potential sale. An investigation conducted by YouGov, an international internet market research company based in the UK, has found that 50% of those who regularly shop online will cancel their purchase if their payment method had not been available. In addition, more than a third (40%) of participants said they were more comfortable making purchases from an online retailer that offers multiple payment methods.
And in many cases it is already very easy to add them. Working with a good payment provider can help you accept many of the additional payment methods. For example, Mollie has recently added Bitcoins, in addition to Paypal, iDeal and credit cards.
According to WorldPay, alternative payment methods (something other than traditional credit or debit cards) will account for more than half (59%) of all transactions in 2017, up from 43% in 2012. This is evidenced by the prevalence of mobile commerce and the increased access to global markets.
The use of digital wallets alone will already rise to 43%, with PayPal already accepted by more than half of the Dutch market (in America this was already the case in 2015). By enabling customers to pay with specialized mobile payment solutions or local payment alternatives, you help the success of global transactions by maximizing global customer reach and ultimately increasing your conversion rate.
What does all this mean?
The more payment methods available in your webshop, the more customers your online store has, the more purchases can be made. Adding a range of additional payment methods means customers aren’t just limited to using credit cards when making a purchase. Ecommerce merchants who recognize and appreciate that different customers have different preferences in making online transactions are moving forward. It is wise to offer multiple payment methods to enable many potential customers to complete their order.