Boosting Customer Loyalty with Enhanced Payment Experiences

The connection between payment experiences and customer loyalty is evident and strong. PWC found that 51 percent of consumers agree that an online shopping experience can negatively impact loyalty if it isn’t as easy or enjoyable as shopping in person. Positive payment experiences marked by speed, convenience, security, and flexibility increase both the likelihood of a successful transaction and the chances the company will earn return business from that customer in the future.

Retailers and merchants can boost customer loyalty by focusing on and improving the following aspects of the payment process that are often experienced in online commerce today:

Accommodating Payment Preferences

E-commerce businesses need to understand how their customers prefer to pay and deliver the ability to transact in the way that feels most common and natural. Cultural differences can dictate how buyers are accustomed to paying for things. If you are a global business, ensure customers can pay in the currency in which their card is issued to avoid surprising surcharges and international fees that sometimes only become known after they are seen on a monthly credit card statement. Know that businesses tend to pay for products and services differently, often opting for local debit payment methods like ACH in the U.S., for example. Offering a wide array of options will increase completed transactions.

Offer a Seamless and Smooth Checkout Process

Checkout friction is the highway to abandonment. Every additional step added to the process fuels the likelihood of a buyer navigating away. Buyers simply do not want to have to key in all their information each time they make a purchase. Frustration can be compounded in cases where billing and shipping information are required to be inputted separately. Merchants can reduce the problem of friction by integrating mobile wallets, like PayPal and Apple Pay, or at a minimum securely storing buyer purchasing information.

Manage Subscribers With Transparency

Subscription companies have drawn greater scrutiny in recent years. Since subscriptions exploded in popularity during the pandemic, consumer frustration has festered as many subscription providers fail to display payment terms from the outset, especially those offering free trials that convert to paid or follow the freemium model. Merchants eager to keep the recurring revenue flowing should ensure it is as easy as possible for subscribers to manage subscriptions, cancel free trials, adjust levels, and change payment methods. Proactive outreach to advise of upcoming scheduled charges or the conclusion of trial periods will reduce customer service calls, minimize chargebacks, and keep loyal subscribing customers in the fold. Some of the items above are not only good practices; they are mandated by the credit card schemes.

Anticipate Information Needs

Too often, the most common information sought by a consumer as they are contemplating a purchase is buried in legalese, difficult to find, or presented at the very end of the purchasing process. Merchants can ward off customer frustration by providing refund, shipping, and other policy details in an easily digestible and accessible way. Display your refund policy up front in simplified language. Don’t drop costly shipping charges just before the purchase button is about to be hit. Share details regarding security compliance and certifications with badges and icons. In the event of a declined transaction, help customers quickly identify where a mistake may have been made, such as an incorrect card number or expiration date, as opposed to making them figure it out on their own. Consumers who face any kind of obstacle to easily accessing the information they want are more likely to walk away.

Incorporate Personalization

Finally, modern global payment platforms now allow merchants to combine payment, search history, and other sources of data to engage consumers on a more personalized level at each stage of the checkout process and even after abandonment, should that occur. By knowing where the customer is in the process, merchants can deliver customized offers and discounts at just the right time, or even activate the service team to engage the customer, all of which can compel the customer to reengage and complete the transaction. Consumers will naturally be more loyal to merchants that make them feel special.  

With the increasing varieties of payment methods and expanding global reach of many e-commerce companies, merchants and retailers must always be mindful of delivering a premium payment experience. Anything less can put loyalty at risk.

Manny Pansa is senior vice president of product and solutions engineering at BlueSnap. Pansa has more than 25 years of experience in payments working in the software, cash management, payroll, payment card, and merchant acquiring industries.