The fourth post in SmartBrief’s Spotlight on Customer Service series is brought to you by First Data, a global leader in electronic commerce and payment processing. Check out First Data’s podcast on what trusted service management means for mobile.
Imagine walking into your favorite supermarket and finding row after row of shopping carts mounted securely on concrete blocks. Would you really browse the aisles, grab a few items, walk back to your fixed cart, then repeat the process over and over again?
E-commerce that isn’t mobile is sort of like a shopping cart that doesn’t roll. With nearly 66 million smartphones in use as of January 2011, Americans are getting used to making a purchase wherever and whenever the mood strikes them. Yet the vast majority of small businesses aren’t prepared to take advantage of the trend: Only about 12% have a mobile website, according to a study by SMB Group.
If you’re not yet set up for mobile payments, you haven’t exactly missed the boat. By some estimates, mobile purchases are set to quadruple by 2014 and could total $633 billion, or 5% of all e-commerce transactions.
How can you get in on that explosive growth? “The key to unlocking mobile commerce [is] to make it easier for people to both search, and then consummate the transaction on the mobile device,” former Google executive Jonathan Rosenberg said earlier this year during an earnings call.
For businesses that are just starting to think about mobile payment systems, the second part of that equation is key. Customers who wouldn’t think twice about whipping out their credit card at home still tend to be hesitant when it comes to entering personal information on a mobile device. Besides the inconvenience of entering 16 digits or more on a tiny virtual keyboard, prying eyes and network security can be perceived as potential risks.
If you already offer traditional e-commerce, your existing payment processor may offer mobile integration that maintains the “look and feel” customers have gotten used to — helping to prevent frustration that can lead to canceled transactions.
If you’re starting from scratch, compare the fees and services offered by at least three different payment processors. While credit cards are the top payment choice in traditional e-commerce, offering a variety of checkout options may help to convert more mobile sales, experts say.
For smaller payments, in particular, text-based SMS payment is a popular option because no credit card is required. Some customers will prefer to have their purchase debited directly from their bank account using an ACH transaction. And third-party providers such as PayPal, Amazon or BillMeLater can help to increase customer confidence when dealing with merchants they may not know well.