Frictionless Commerce – The Future of Payments Isn’t about Payments


It’s been a very exciting year for us at DalPay and CCNow, and for the e-commerce industry as a whole. We’ve shared some of that excitement with you here on our blog as well as our Facebook and Twitter pages. With our E-Commerce Growth Report 2014, we looked back on how far the industry has come and where it stands today. Now, however, is the time to start looking ahead at the future of payments.

Is there any doubt what payments of the future will look like? Mobile and contactless payments are poised to sweep up whatever is left of traditional point-of-sale (POS) payments, while alternative payments are outgrowing traditional methods, such as credit cards, year after year in the e-commerce sphere.

So, as far as merchants are concerned, the future of payments isn’t about payments anymore – it’s about optimising those payment methods to provide a better user experience and higher conversion rate. Moving ahead, it’s no longer about developing new payment alternatives, it’s about developing frictionless commerce.

What is Friction?

Friction is anything (anything at all) that slows down or otherwise disrupts the online shopper’s journey from ‘browse’ to ‘buy’. Whether it’s a slow-loading site, confusing design, pop-ups, or an unwieldy checkout process, any amount of friction is going to have a negative impact on your conversion rate. The less friction you have, the more conversions you’ll make – it really is that simple.

E-commerce has the potential to be the perfect payment landscape because it makes frictionless commerce attainable. With online shopping, information can be transferred instantly, prices can be easily compared, and transactions can happen anywhere the shopper is located. So what is preventing e-commerce from taking over completely?

Online businesses of all kinds face a predicament. Because credit cards remain the most common online payment method, merchants need to accept credit card payments or risk alienating the majority of their potential customers. But credit cards are also easily exploited for fraud.

The difficult part is finding the right balance between security and ease-of-use. If you’re too permissive, you run the risk of losing a large portion of your profits to fraudsters and of developing a reputation as an unsafe place to do business. If you’re too restrictive, you could turn away customers by forcing them through too many security checks and making them feel like a criminal.

One of the reasons for the rise of alternative payments is the need for more secure ways to make and receive payments online. For example, DalPay’s e-commerce platform is favoured by merchants because it allows them to accept payments from their customers without the friction-causing security requirements necessary to mediate the inherent risks in credit card payments.

How to Reduce Friction

The modern digital economy is driven by rapid innovation. Cloud computing and on-demand scalability at a low cost allow new market entrants to compete at a global scale. But what makes a business stand out in a crowded marketplace is simple – does it feel good to use? Shopping cart abandonment is at a whopping 67%. You can’t underestimate how many more customers you can convert by simply reducing friction.

Friction is literally anything that slows down a customer’s journey from ‘browse’ to ‘buy’, so there’s a nearly endless number of causes, but just to help you get started here are a few reliable ways to reduce friction:

  • Increase your loading speed. Consumers won’t wait very long at all for a website to load before opting for a competitor. 40% of consumers have said that they would leave a site after only 3 seconds. Regularly test your website’s performance and upgrade your hosting services to ensure that it loads as fast as possible.
  • Integrate dynamic shopping cart software. There are nearly as many different consumer habits as consumers, so a dynamic shopping cart that allows people to shop however they want is a sure fire way to make more people happy. Multi-item checkout is expected to be a given, while additional features (such as saving your cart) can encourage repeat customers. DalPay offers several free shopping cart modules to suit your business’ needs.
  • Streamline navigation. A website that is difficult to navigate is an unsuccessful one. Make your webstore simple and attractive, with easy-to-find search tools, category pages and buy now buttons placed in clear and expected locations. Eliminate clutter and ensure that browsing feels comfortable and intuitive.
  • Perform A/B testing. Every time you make a change to your website, however small, compare the before and after conversion rates to gain valuable insight into what is causing friction and what is relieving it. Depending on the payment habits of your clientele, there could be many unforeseen sources of friction that A/B testing will allow you to identify and eliminate.

It’s often said that consumers are impatient and you shouldn’t have to make them think. We don’t believe that’s quite accurate: it’s not that customers don’t want to think or get impatient with your checkout process. If your website is poorly designed, navigating it is confusing, or there are just too many steps, your customer is going to feel uncomfortable and lose trust in your business. Once you lose their trust, you lose their business.

People want comfort, convenience and a good deal, and when they find something they like and trust, they remain loyal to it. That’s why e-commerce is all about building relationships. The easier you make it for your customers to purchase, the more likely they will return to your website, tell their friends and write positive reviews. When you reduce the friction in browsing and buying, you not only increase conversions, you increase loyalty and keep customers coming back for more.

Enter your email address to follow this blog and receive notifications of new posts by email.



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s