Online retailers globally lose about $4.6 trillion due to abandoned shopping carts; e-commerce brands lose about $18 billion of this figure. 25% of the $4.6 trillion results from high prices while 27% is due to the complicated checkout process. There are even more alarming statistics regarding the revenue loss businesses experience due to payment rigidity.
As the world of e-commerce continues to evolve exponentially, it is important to adapt to maintain a competitive edge. A key strategy to do this is to implement flexible payment options for your customers. This is pertinent to improve your sales and revenue. In this article, we will be discussing flexible payment options, their benefits and how e-commerce businesses can implement them to maximise their revenue streams.
What are Flexible Payment Options?
Flexible payment options are a range of payment methods that serve as alternatives to traditional upfront or cash payments. These payment methods include cryptocurrency payment, deferred payment or Buy Now Pay Later (BNPL), instalment payment, and subscription-based payments, amongst others.
Benefits of Flexible Payment Options
Here are some benefits of flexible payment options:
Expanded customer base
Businesses can access untapped market segments by offering a broader selection of payment options. Accepting various forms of payment methods can attract a larger customer base as it allows you to cater to their unique financial situations. Receiving various forms of payment methods would attract a wider customer base as it allows you to cater to their unique financial situations.
For example, Gen Z and Millennials are increasingly embracing a cardless lifestyle, as 67% of people between the ages of 18-29 are reported to not having a credit card. The world is virtually becoming dominated by Gen Z and Millennials, as their population is projected to grow by 70% by 2028. Putting this into perspective, they are likely to make up over half of your customer base within the next decade. So, you would be doing your business a great deal by accommodating their unique financial preferences in your payment options.
Increased revenue
Flexible payment options attracts a larger customer base, which causes businesses to distribute revenue over time. On the other hand, it is also beneficial in terms of reducing the impact of seasonal fluctuations and improving cash flow management. Hence, people can pay with crypto or some other methods in cases such as inflation where cash is not in circulation.
Increased Average Order Value
Average Order Value (AOV) is the average amount a customer spends per transaction. With payment flexibility, your customers are likely to spend more money because of the ease it affords them. They are even more likely to make multiple transactions more often than they normally would.
Enhanced Customer Loyalty
The increased convenience that comes with multiple payment options helps to foster trust and loyalty. Online businesses are usually presumed to be fraudulent. However, the flexibility makes them believe that their convenience is your priority. It reduces cart abandonment rates and enhances customer retention. Staying up-to-date with financial trends also demonstrates that your business is well-suited to your customers’ needs and preferences.
Competitive Advantage
Flexibility in payment can provide your business with a significant competitive advantage over your competitors that do not offer similar choices. If you serve international customers, being adaptable to these preferences makes your firm appeal to global markets. In addition, you are able to position your business to adapt to constantly evolving regulatory changes.
Implementing Flexible Payment Options
Implementing flexible payment options can take extra effort. But, using a strategic approach can make the process smooth for you and your customers. Below is a step-by-step guide to kickstart the process:
Conduct market research
Analysing your customer base to understand their preferences and financial behaviours will help you tailor your offerings to the options that are most valuable to them.
Select appropriate payment platforms
Select trusted payment gateways and platforms that can seamlessly integrate into your e-commerce infrastructure. Also, ensure they align with your customers’ needs. Some payment options include credit/debit cards, Buy Now Pay Later, bank transfer, crypto wallets or digital wallets such as Apple Pay and PayPal.
Communicate the payment options
Ensure to clearly communicate the available payment options to customers at various touch points on your website or physical store (if you have one). Inform them of the accepted cards and payment platforms. Also, educate them on the benefits of each and if possible, provide incentives to encourage them to use specific methods.
Regularly test the platforms
It is important to continuously monitor the performance of your flexible payment options to simulate the user experience. It is a good way to discover errors and troubleshoot them to ensure the checkout process is hitch-free.
Increase your sales today!
Adopting flexible payment options into your business model is a great approach to increasing your sales. Contact us today at Primeclick Media to elevate your sales strategy and help your business thrive in today’s dynamic market.
