opinion

How Global Internet Growth Impacts Your Billing Strategy

Ruth Blair

You may be shocked to discover that 34 percent of the entire global population is already connected to the Internet. In real numbers that’s a staggering 2.4 billion people! Perhaps the greater surprise comes from the distribution of those 2.4 billion connected individuals. According to data from comScore only 14 percent of Internet Users hail from North America; 27 percent are European; 41 percent come from Asia Pacific; 8 percent navigate from Middle East and Africa; and 10 percent visit from Latin America.

In the online adult entertainment industry, credit card processing is the most commonly implemented payment method for membership site subscriptions. Combining the perfect mixture of instant confirmed purchases, immediate membership delivery, a high-volume user base, and the option to automatically rebill, credit card payments certainly have a positive impact on site conversion and sales retention. Although credit card processing is obviously fundamental, it is important to note that, in Europe and many other countries, alternative payment methods are much more popular than credit cards, and actively in use by the general population. If you don’t already offer these alternative options, you may be missing out on some easy sales.

Alternative payment options are growing in popularity. There are numerous alternative payment options on the market today; however many will not tolerate adult membership transactions due to the high risk nature of the transactions.

Worldwide Growth Online

Brazil’s online population experienced an astonishingly rapid growth of 41 percent between March 2012 and March 2013. In Brazil most credit cards are only valid for national transactions and not for cross-border transactions. This can create a serious conflict for any Brazilian consumer who wants to purchase an online paysite membership if credit cards are the only available payment method. To effectively monetize Brazilian traffic it would help to be able to accept a preferred local Brazilian payment option such as Boleto Bancários.

More data from comScore indicates that Latin America showed the highest percentage of growth across the world between March 2012 and March 2013. Many countries developed a greater online presence during that time and this has created a larger number of people actively browsing sites online, hunting for a good deal.

Familiarity Breeds ... Sales?

Europe is a continent that boasts 27 percent of the global online population. In Europe you’ll find that DirectPay EU, Discover Cards, EuroDebit and several other individual country payment providers such as EPS, giropay, and iDEAL are used by hundreds of millions of European consumers on a daily basis.

When your customer sees a recognizable payment symbol on your join form, that familiarity will help encourage a feeling of security and safety when considering an online purchase from your site. Think about your own online purchases and ask yourself this question: “Do I prefer to make an online purchase when I recognize the payment methods on the payment form?”

If you answered yes, then you’re in good company. Most consumers would rather use their preferred payment method instead of being forced to use an alternative. To productively monetize your International traffic it is advantageous to provide familiar payment options to your customers.

Avoiding A Messy Join Page

Some business owners may be concerned that the implementation of alternative payment options on the join form might compromise the overall conversion ratio of the site. One theory being that, just as familiar payment symbols on the join page can help invoke a sense of trust and increased security to seal the deal on the purchase; too many unfamiliar payment symbols on the page can spark feelings of uncertainty that may push the customer away.

Geo-targeting allows you to identify your traffic by location which enables you to direct that traffic to a specific country-oriented join page or tour. With geo-targeting activated on your site your German traffic could be directed to a join page that includes giropay and Direct-Pay EU; a Swiss consumer could be shown the PostFinance symbol; and a Dutch citizen would see the iDEAL payment system option on the join page. Offering these localized payment options along with traditional credit card processing, but without the confusion of other unrelated payment options on display, should improve your profit margin.

North American Alternatives

Brazil, Europe, and other International destinations are not the only locations where implementing alternative payment methods can help capture new sales and boost your profits. As reported by the Federal Reserve Survey of Consumer Finances and the U.S. Census Bureau, in July 2012 there were 1.5 billion credit cards actively in use in the U.S. However 29 percent did not have any credit cards at all, and when you consider the size of the population of the U.S. (313.9 million in 2012), 29 percent is actually a pretty big number at over 91 million people.

Alternative payment options are growing in popularity. There are numerous alternative payment options on the market today; however many will not tolerate adult membership transactions due to the high risk nature of the transactions. Internet payment service providers like Epoch and CCBill automatically provide a variety of international adult-friendly payment options in their packages.

You will also find alternative billing companies like Paxum and 2000Charge and mobile billing companies like Global Acces and DialXS can offer some interesting choices to add to your already existing selection.

Alternative payment companies like Paxum can provide purchase anonymity and security to the consumer; chargeback protection to the merchant; and instant delivery of payment and membership to both parties. Creative paysite affiliate programs can take full advantage of such a system by enabling same-day instant payouts to affiliates for those types of sign-ups since there is no concern for chargebacks with Paxum.

Adapt Or Die

A phrase regularly heard in the adult industry over the last few years has been; “Adapt or Die.” One effective and surprisingly easy way to adapt your business strategy and improve your returns is to implement some alternative billing options to capture new sales and increase exposure of your brand.

Talk to your current billing provider about your options. Perhaps some of the alternative payment methods mentioned in this article are already available within your account. If not, the adult billing industry is a close-knit community full of competitive yet co-operative businesses who will generally be able to help you connect to the right person at the right company for your billing needs.

Ruth Blair works for Paxum Inc. in a business development role. She has more than a decade of experience working in various aspects of the adult industry. If you’d like to connect with Blair directly, she can be reached via email at ruth@paxum.com.

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