When attempting to run a successful e-commerce business, there’s nothing more frustrating than payment failure. It can slow things down on your end. As well as this, it can mean the customer becomes irritated as a result of these disrupted transactions. If this happens to be a reoccurring issue, the worst-case scenario would be losing customers for good. Research has shown that e-commerce businesses can lose over 60% of their customers that have experienced a transaction failure.
Therefore, online merchants that can successfully reduce the number of transaction failures will increase customer satisfaction, retain customer loyalty and thus, increase overall sales. Read on to find out how best to limit e-commerce payment failure in your business.
Why Do Payments Fail in the First Place?
Before starting your e-commerce business, you would likely have made hundreds, if not thousands of online transactions with ease. This leads many people to believe online transactions are a simple process. However, this is not the case. Online payment is a complex process as multiple different components have to succeed for one simple transaction to take place. The process involves the merchant, the issuing bank, the customer, and the payment acquirer.
One of the main reasons for payment failure is actually from the consumer’s side. This can be especially frustrating as you have done everything on your end to ensure a smooth transaction, but it can still be disrupted by the consumer. This can be due to several different reasons.
Most commonly, they have entered incorrect information. Another key reason is insufficient funds. One way to counter this is to incorporate account balance verification into the payment process. Envestnet | Yodlee offers an effective solution via its balance verification solution. This will confirm the consumer’s balance in real-time and prevent transaction failures. It can also notify customers of low funds so they can easily see the problem and select an alternative payment method to move forward with the transaction.
The Front-End Experience
To avoid any potential consumer irritation, you should look to improve the front-end experience on your website. This is important as making it as easy as possible for the consumer greatly reduces the risk of payment failure. Making your website as easy to navigate as possible plays a key role in this. You should also look to include a customer service option on the website such as a live chat so that if the user is having difficulty, it can be easily resolved.
A simple and effective checkout process is important, ensuring the requirements for the transaction are clearly stated.
While these steps may sound simple, they are extremely effective in reducing payment failures and consequently increasing customer satisfaction and sales. The most important thing is to make the customer experience as easy as possible. This is done firstly by adapting the website’s front-end, making it easier for the customer to enter the correct information. Account balance verification is also a key factor in improving the experience because if the payment does fail, the user is immediately aware of the issue and how to resolve it.