opinion

Global Alternative Payment Optimization

Joe D

Alternative payments have been a popular topic for industry publications since about the year 2000, but we began seriously writing about local global payments about six years ago. Early adopters have been reaping the benefits for years, but it’s never too late to add alternative payment options to your join page.

Having multiple and local payment options is a must if you enjoy global traffic. The prevailing argument against adding these options has always been, “but all these options will just confuse the user.” This myth has been handily debunked by the online gambling and browser games companies who sometimes have 80 unique methods for the user to choose from – the reality is that with geo-targeting the user scans the payment logos and the one or two they are most familiar with jump out from the list and are instantly recognizable by the user. The key is presentation; the goal for the user is easy, familiar and comfortable.

The greatest barrier to the merchant in adding alternative payment methods is usually allocation of precious technical resources.

The greatest barrier to the merchant in adding alternative payment methods is usually allocation of precious technical resources. Alternative payment methods come with APIS, and skilled programmers are usually needed for integration. Each method comes with its own degree of difficulty and unique time requirements. Often, the objection I might hear would be, “I can’t pull a programmer off a million dollar project to implement a payment method that will just produce a 5 percent revenue increase.” My favorite reply has been, “If you implement now, you can hire more programmers…” Of course back in the day, you couldn’t get a program owner off the golf course for another 5 percent per month; in today’s market conditions, it’s a little easier to peak some interest. And the merchant using NATS or MPA3 has a much easier time with integration.

Let’s talk a little bit about choosing the payment methods you should add. An important point is to talk to many different sources, comparing results of your research. Talk to everyone, but choose a few highly respected industry experts to help you understand the wide variety of payments and their applicability for your program. If I don’t think a payment method is appropriate for your business model, i will look for a method that best fits your needs. I learned that early on. Popular fallacies still perpetuated are: We have that. We cover that. You don’t need that. You don’t need anyone else. We convert better. Ask to see country-specific join pages served, and don’t pay more for your credit card processing in order to access local Global alternative spayments – you don’t have to.

Your first consideration should be your traffic. Identify your top global markets and concentrate on those specific payment methods best suited for your surfers. Determine which payment methods would be most beneficial, and then explore which billing platforms provide the most coverage and include the most appropriate options. Unfortunately, it will not be just one biller, you will need multiple billers to best cover the markets, and really, it’s always best to work with multiple billers anyway – you cannot have too many payment methods. If you have the budget to purchase traffic, another tactic here would be to identify an underserved emerging market whose traffic is inexpensive — where your content would be popular – and implement the local methods there to get an early foothold as that region grows.

Demand for alternative payments is growing along with awareness of them, primarily driven by the new mobile and tablet generation. A recent research project found that 83 percent of consumers expect to be given an array of options to pay for products and services online. 43 percent responded that a choice among more payment options would motivate them to complete a purchase and spend more online. A really interesting result was that 45 percent of online users make crossborder purchases today, and making certain you offer their preferred payment method is the key to completing a sale or selling a subscription.

While we’ve noted that ‘alternative’ is a relative term for payments, let’s consider the following to represent the group: realtime bank transfers, offline credit transfers, direct debits, e-wallets, paper-based payments, cash payments and mobile payments. As you plan your strategy for adding methods, consider that real-time bank transfers, ewallets, cash and mobile are expected to grow significantly, direct debit should remain constant in the near term, and offline credit and paper-based payments are expected to decline.

The skyrocketing online participation among residents of the BRIC nations is a result of increased broadband availability and vastly improved access. Social media is providing information about products, shopping and popular trends never before available to these markets, driving demand for what others consider popular and desirable. All this fantastic growth and change will continue to evolve, but what remains stubbornly constant, especially when one in four consumers have been the victims of online fraud, is the desire to make payment in a simple, swift, secure comfortable manner. Online competition is intense, and getting the payment choices right is imperative if you are to succeed in expanding and growing globally.

According to Worldpay, China’s online economy will grow at a compound annual growth rate (CAGR) of 22 percent. So too will Brazil’s at 18 percent. India’s e-commerce market is set to explode, with an expected CAGR of more than 40 percent. Providing alternative payment options on your join page for these markets will drive initial revenues greater than credit card sales. And if you have Russian traffic but have decided not to accept Russian credit card transactions, ask me about a cash alternative.

Many of you would probably like to expand your alternative payment options, but are put off by the time it takes to research and identify the best alternatives for your business model. Again, choose a few trusted industry experts and compare and contrast their claims and advice. I am happy to discuss payments and strategy any time. Remember, there will always be overlap, and one biller cannot optimally cover all your markets. Alternative payments are vitally important to continued growth, or even maintaining traditional numbers as the industry matures and competition increases. The merchant with the greatest choice of payments has a decided competitive advantage over the merchant still dependent on credit card sales or with limited alternatives relative to their primary markets.

Develop a strategy in consultation with trusted sources, and combine billers to get the most coverage with the least technical commitment. Know what you have.

Joed is the Chief marketing officer at netcash.com, offering secure, discreet, convenient billing for your sites, and the declinecash© cascade option to combat declined credit cards. Joe is a go-to source for insight and access into industry markets, appropriate payments and all things ecommerce. Reference his blog at: www.xbiz.com/blogs/joed.

Contact Joe at joed@declinecash.com and ask him about real cash payments for emerging markets and converting declined credit cards.

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