Nurturing online business growth amidst a changing payments landscape

Across the world, it is safe to say, we are seeing a dramatic shift in consumer shopping behaviour due to current COVID-19 restrictions.

Nurturing online business growth amidst a changing payments landscape

Across the world, it is safe to say, we are seeing a dramatic shift in consumer shopping behaviour due to current COVID-19 restrictions. As social distancing measures remain in place, many consumers who would have usually visited stores to make a purchase, have now taken to online shopping. Whilst the pandemic is having a profound effect on the economy, the e-commerce sector is certainly one that seems to be thriving.  According to a study by Kantar, up to 80% of shoppers are now makingat least half of their purchases online in the UK, Germany and France. In China,, the country’s largest online retailer, saw sales of common household goodsquadruple during the peak of the outbreak there.

Whilst this is good news for the e-commerce market, it is important for businesses operating online to understand how they can best serve new (and existing) customers during the current climate.

With that in mind, here, we explore how merchants can position themselves to stay set for growth, and stronger than ever before:

  1. Improving user experience

Customer experience has become a well-trodden battlefield of the e-commerce sector. More merchants are establishing online shops, which means that the competition has become increasingly fierce. As a result, merchants are needing to work harder than ever before to find and eliminate weak points in the customer journey.

Consumers preferences over how and when they shop are also changing. Findings from PYMNTS reveal consumer usage of mobile devices in stores has increased since 2019, with the number of consumers who report using their mobile devices to enhance their in-store experiences up from 49.6% to 72.1% in the last year. To support this growing shopping trend, merchants must design a site that is mobile-friendly to enhance the customer experience and convert as many opportunities as possible.

  1. Calculate your cartabandonment rate

Merchants that are not meeting consumer preferences during the payment process can often lead to many customers abandoning their baskets at the checkout. In fact, according to PPRO’s latest research, 44% of UK consumers will abandon a purchase if their favourite payment method isn’t available. This can often leave merchants suffering from declining conversion rates as a result. With the average cart abandonment rates estimated to sit between 60% and 80%, it’s important to define and address the key causes. There could be multiple reasons for basket abandonment for example, their favourite payment method may not be offered, shipping costs may be too high, they found a better price elsewhere, or delivery preferences weren’t available.

  1. Simplify the checkout process

To improve conversion rates, it’s also important to review the complexity of the checkout process. A long and drawn out process can be somewhat off putting for a customer who is used to an Amazon-style one click shop. In fact, a recent study by PPRO found that over half of US and UK respondents agree they would stop a purchase if the checkout process is too complicated. In fact, 37% of UK consumers avoid using merchants that require repeat entry of payment credentials. For your new online customers, those who have previously been loyal to brick-and-mortar shops, it is also worth considering adding tips or instructions during the checkout process. This will further simplify the process and minimise the risk of customers abandoning their purchases.

  1. Consider expanding andentering new markets

For those considering expanding online ‘ now is the time. As online shopping rises in popularity, more and more shoppers are prepared to look across borders for what they want: stronger brand loyalty, the better quality products, payment methods accepted, and more. You could be reaching untapped markets by offering the right mix of goods, user experience, local payment methods, and delivery options.

  1. Identify local paymentpreferences

According to a recent study by Baymard Institute, 20% of abandoned carts are due to a failure to offer the customer’s preferred way to pay. Working with a payment service provider to activate as many payment methods as possible at you’re the checkout can be particularly beneficial. With over 450 significant local payment methods across the globe, each country will have different payment cultures, for example; APAC is dominated by e-wallets like Alipay, WeChat Pay and GrabPay. LATAM consumers are reliant upon cash-based payment methods like OXXO and Boleto Bancario, or locally issued credit cards. By finding out what local payment methods customers in each target market prefer, this will help to generate trust with new and prospective audiences.

There is every reason to believe that the acceleration of online shopping will continue as the ramifications of the pandemic start to subside.  Even when lockdown measures are eased, there will be many who feel cautious about returning to shops, restaurants and other brick-and-mortar outlets.

As the ongoing restrictions associated with COVID-19 continue to drive consumers online, now is the time for e-commerce players to review the online customer journey. Businesses that do will see a positive impact once the lockdown period ends, with a larger and more loyal customer base.

James Booth
James Booth

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