£10bn reasons to reassess your payments data

For retailers, every penny counts. UK online retail sales grew 13.2% year-on-year with Britons spending more than £10 billion online during March 2017 alone. Busy shopping periods such as Easter, half term and the May Day bank holiday weekend present an ideal opportunity for retailers to assess weak points in their customer experience journey. The ability to analyse payments data during these periods is key to identifying issues and making informed decisions about where improvements need to be made.

Abandoned shopping carts

As average online shopping basket values grow – reaching £88 this year – abandonment at checkout is a key issue for retailers. The payments process is one aspect of the customer journey to examine when looking for ways to enhance the customer journey. By assessing data, retailers can gain an understanding of why abandonment is happening amongst different demographics, and make changes to retain customers and increase conversion rates.

Revisit the return process

Another thorn in the side of retailers is product returns. Returns are a necessary part of the retail experience and making this process convenient has become a differentiator amongst retailers vying for loyal customers. While returns can impact retailers, fraudulent chargebacks (where users go through card providers to reverse a transaction) are significantly more damaging. Chargebacks can apply if goods are damaged, not as described, or haven’t been delivered.

Chargebacks have opened a door to fraud where customers file them for the wrong reasons – perhaps they have ‘buyer’s remorse’, or want to make extra money while retaining the goods they originally purchased. This impacts retailers in terms of both lost stock and money, driving retailers to examine why customers are opting to use chargebacks in the first place, rather than following official returns protocols. Making returns as easy as possible for customers is one step retailers can take to minimise chargebacks, while improving the accuracy of product descriptions and better managing customer expectations also helps to minimise product returns.

Four key questions:

High levels of traffic count for very little without a comprehensive and stable payments process in place. By its very nature payment is often the last, but arguably the most important stage in the customer journey. By helping to identify shortfalls in the payments infrastructure, merchant acquirers can help retailers maximise opportunities to deliver a positive customer experience at all points in the customer journey. Here are four key questions to put to your acquirer:

1. How do you ensure that your system can handle fluctuations in transaction volumes?

Merchant acquirers should have testing processes in place to make sure the payments systems can handle a variety of different scenarios, including a sudden increase in the volume of transactions being made. This testing should have been incorporated from the initial stages of creating the payment processing software rather than being an afterthought; a merchant acquirer whose software has been thoroughly tested throughout its development will be able to stand up to a wide variety of scenarios, as all parts of the process will have been tested against a number of challenges.

2. How quickly are transactions processed?

Consumers expect transactions to be processed almost instantaneously, and the UK in particular mark this as an important factor in the payments process (43%). Customers may ‘compare-shop’ online; having more than one retailer’s website open at a time in order to find the best price. If multiple retailers offer a product at the same price, then an efficient payments process could prove to be the defining factor in the customer’s decision making process. Whilst transaction time is partly down to the eCommerce system, the time it takes to process a transaction can be impacted by the merchant acquirer’s technology and the software or systems used to connect with various downstream providers that are involved in the process.

For example, in some cases a merchant acquirer does not connect directly to a bank but goes through other third parties. This will inevitably slow the process and introduce additional points at which a technical fault could be encountered. In addition, fraud filters can also slow down transactions as the information goes through multiple checks. Whilst fraud prevention measures are necessary, they vary between payment methods, therefore retailers should check that their acquirer has streamlined security checks to ensure an efficient process.

3. What measures do you have in place to ensure payment information is secure?

From a customer experience standpoint, data security is the most important aspect of a payments journey. All retailers should be aware of the rules around card data and what information can and can’t be held, as per the Payment Card Industry Data Security Standard (PCI DSS). First and foremost, retailers should ensure their merchant acquirer is compliant with PCI DSS, and operating to the highest level of compliance and security standards.

4. What is your fraud resolution process?

Even with all the necessary fraud prevention measures in place, no business is completely immune to fraud risks. There are many different types of card fraud, from stolen and cloned cards which are physically handed to a retailer, to the use of card information for Card Not Present (CNP) transactions over the telephone, mail or through an e-commerce site, so retailers need to be prepared for them all.

Andrea Dunlop is CEO of Card Solutions and Acquiring at Paysafe, a provider of digital payments and transaction-based solutions to businesses and consumers worldwide with a focus on emerging payment technologies, including mobile.