Increasing revenue isn’t always achieved by making a product better or keep innovating on it. You can also increase revenue by making it people easier to give you their money. Which is one of the things I have done over the past 6 months or so.
In the first half of this year, through last year, I had some issues finding a suitable Credit Card processor. In short, none of them would have me as a customer for various reasons – Mostly because my revenue was too low or because I was not in their area of operation.
This post outlines the past 15-18 months of me finding the right combination of checkout options.
Trying out payment options
At first I was sort of stuck with Paypal. Which in itself works fine. But checkout is a hassle with them. And it’s long, often slow and with that very easy to just give up and not get the product at all.
Later I added a new payment option called ‘Paypal Express (Digital Goods)’ so I could accept Credit Cards. This was a lot faster and worked fine. For those who understood the process. A weird popup would come up and if you clicked outside it or simply closed it the popup would disappear, cancelling the order. This was a disaster.
Somewhere in between I have experimented with the Click&Buy gateway, but that didn’t work at all and was more hassle than it’s worth. The signup process took a month and when they finally understood what I wanted none of their software worked with modern versions of PHP (on the server). In short, a unworthy failboat.
Then I discovered that my own bank offers a payment gateway as well. According to them this would be the ultimate solution to my Credit Card problem. It wasn’t, and after a while I just disabled the Credit Card option in it because it simply didn’t work for cards outside the Netherlands. Turned out their software processing payments was broken.
Then I professionalised the checkout process a bit by adding SSL (HTTPS) to the site. This ensures the buyers data and privacy is guaranteed. I also added the Stripe Payment Gateway with a on-site checkout option. So unlike Paypal where you’d leave my site, go to their checkout pages, then are sent back. You stay on my site for the entire process. Which is much more user-friendly, faster and transparent.
To further my fight against cancelled orders I removed the Paypal Express option and last month I also cancelled my own banks ‘solution’.
So now just standard Paypal, Stripe and Bank transfers remain as payment options.
Up your sales by minimising cancellations
I’ve introduced Stripe in July/August this year and look what happened to my cancellation rate for Q3 and Q4 (picture). Of-course the 4th quarter isn’t over yet. But the low number is a good indication. Compared to last year I’ve increased my revenue by approximately 5% just by reducing cancelled orders (Which translates to almost €4000 Euros). That’s on top of the normal growth, which will be about 10% at the end of this year, over last year.
If you look at the numbers you’ll see a fairly high cancellation rate in the first 2 quarters. 18.6% in the first quarter and 18.8% in the 2nd. The in the 3rd quarter Stripe gets added and the ‘problematic’ Paypal Express option gets removed at the same time.
So my conclusion basically is – People want easy checkout or they won’t buy at all.
That’s sort of a “duh” but not all that easily achieved apparently. While many Payment Processors provide good gateways (or functional ones) they are often not that user-friendly.
And a lot can be done to make this better and more ‘fluid’ or ‘smooth’ for the user.
If you run a well organised webshop you have sales numbers. Order stats and statuses. You should closely monitor your orders and failed orders. Try to figure out why they fail/get cancelled. Perhaps it’s not the buyer, but your site that needs a slap in the face.
Monitor, Optimise, Monetise!