When it comes to payments on a global scale, Keren Levy, chief operating officer at Payoneer, told PYMNTS, there’s an overarching principle: Localization and data are critical.
“Every eCommerce site today is facing an enormous complexity of different payment methods, front-end processes and backend processes, every time they grow and expand,” she said.
Payment orchestration platforms, Levy noted in a recent interview, can give merchants power in their bid to improve margins, while maintaining the flexibility to react to ever-changing customer demands, improve buyers’ experience and acceptance rates, and add or remove payment capabilities as necessary.
As Levy noted, retailers, amid the explosion of online commerce, have been busy investing in the online experience, setting up their sites to help end users find exactly what they want, when they want.
“But at the end of the online journey,” she said, the experience is lacking: “There is a lot of cart abandonment. We’re witnessing this now more than ever. ” She estimated that for some merchants, roughly 70 percent of carts are abandoned before the order is complete – and in some cases, orders done through mobile devices are seeing rates of abandonment that are even higher.
To get that far into the customer journey and come away empty-handed is the equivalent of fumbling on the one-yard line.
Half Of The Abandonment
About half of overall abandonment is due to the fact that merchants do not offer preferred payment methods, Levy told PYMNTS. “On top of that, consumers are concerned about payment security – and they are confused, in general, by the checkout process,” she said.
Against that backdrop, payment orchestration platforms offer merchants a seamless way to embed preferred payment methods into their online experience. The complexity of multiple PSP integrations can be reduced to a single point of interaction via API, said Levy, and compliance is automated. She pointed out that a payment orchestration layer also increases redundancy and therefore reduces risk, because connectivity to several different providers means you can easily switch to another one when a provider experiences downtime or poor performance, or when service is otherwise negatively affected.
Optimizing The Checkout Experience
The checkout experience is also critical to taking a business across borders. It’s not easy for merchants, especially smaller ones, to grow and establish a presence in new markets around the globe. They have to take into account the fact that no two markets or geographies are exactly alike when it comes to consumer preferences or the changing tastes of certain demographics.
In fact, consumer preferences can even change based on the actual transaction. “Sometimes the way we pay changes, depending on the amount of the purchase and different products that we buy,” noted Levy.
It’s critical for the digital businesses serving markets beyond their domestic ones to consider, embrace and offer the local payment methods that are familiar to consumers – and to offer new ones such as Google Pay. When approaching new markets, said Levy, merchants should take an incremental, strategic approach in offering the most “important” payment methods in each region, adding new ones as the market demands.
Along the way, and with the aid of a payment orchestration platform, these same merchants will find that they have the power and insight that comes with data: They gain visibility right down to the transaction level, helping them better understand the range of performance and costs spread among different providers.
“They can now compare between different PSPs and other providers – and can see, for example, the charge-back rates – and this data gives them more power and leverage to negotiate with those different service providers,” said Levy. At a high level, she said, payment orchestration helps enterprises increase their approval rates and offer an optimal experience to their end users.
Agility and improved conversion rates (with improved margins) are critical in competitive markets, and especially with cross-border transactions (with currency conversions and FX rates affecting transactions).
And though the customer may never be aware of what’s going on in the background, so to speak, payment orchestration helps satisfy the end goal. As Levy told PYMNTS, “At end of the day, we would just like to shop the way we like to shop.”