The payment options at checkout can influence a customer’s ability to purchase on a Shopify store. Businesses should not just think about the availability of a payment method as processing costs, customer preferences, transactional values, and requirements can influence the checkout process. Understanding this can help Shopify businesses develop a balanced approach to a customer’s payment experience.
Why Payment Options Matter At Checkout
A customer’s preference can differ for different products and services. Some individuals may choose to pay with a credit or debit card, whereas others may look to find a different method for larger or recurring payments.
As a business can enable options that best cater to a customer’s situation, it can also require additional processing costs and requirements.
Businesses should therefore consider a mix of the impact on a customer and the financial burden of a payment method before it adds an option to its Shopify store.
How To Choose Payment Options For A Shopify Store
The best payment processor for Shopify can differ for different businesses. A store that sells cheaper products will have different needs compared to one that sells high-end products or services.
The number of transactions, average values, the location of customers, their preferences, and the nature of a product or service can dictate a fit between a business and a payment processor.
A company should also review the interaction between the Shopify platform and a payment processor as features, payouts, transaction processing, refunds, and customer support can impact the day-to-day operations of a business.
How Transaction Size Can Influence Payment Choices
The size of a transaction can influence how a business views its costs between payment methods. A lower-value purchase will see a company take into account how a fixed charge impacts the cost of a product or service.
A higher-value purchase may see a percentage-based fee have a greater impact on the final price paid by a customer. As such, businesses that regularly process larger payments may look to consider other options in addition to card payments. The average value of an order in a Shopify store can provide an insight as to how the cost of a payment processor will affect a company.
Considering ACH For Larger Or Recurring Payments
ACH payments operate as a means of electronically transferring funds between accounts and can be an option for specific transactions. They may be used for larger payments or those that are ongoing in nature as businesses and customers may choose them for recurring payments.
Businesses should however understand the costs and conditions of a payment processor before considering this option. ACH processing fees can differ between providers with some using a percentage-based system, a fixed approach, or a combination of the two.
Companies should therefore look to assess a wider view of a cost structure rather than a single figure when assessing the impact on their transactions.
Reviewing Payment Methods And Customer Needs
A Shopify business should look to consider what options its customers use. A company should not feel the need to offer every possible form of payment if there are only a few that are regularly used.
Instead, businesses should look to review their customer base, average order value, frequency of purchase, and any preferences they have in order to identify relevant options for their store.
The cost of using a payment method should also be reviewed so businesses are able to understand what impact their choices have on their overall expenses
Monitoring Payment Performance
The requirements around payment can change depending on a company’s performance. A business may begin with fewer transactions and move to larger volumes or an increase in average order value and recurring payments as it grows.
As such, businesses should look to periodically review their payment setup and consider their needs at a specific time.
Transaction data can provide an indication as to what a company spends on processing fees depending on what methods it currently uses. A business can therefore look to determine if the costs it incurs across its payment options are reasonable based on its transaction volume.
Balancing Customer Experience And Payment Costs
Selecting an option for a Shopify store requires a company to identify what its customers prefer while balancing the impact on its costs and requirements. Businesses should look to consider the size of a transaction, preferences, the burden around processing, and an option’s features and payout structure rather than a single factor. By constantly monitoring its activity and expenses surrounding a payment method, a Shopify business can ensure it maintains a structure that meets its customer’s needs while considering its own.