Major shopping events including Alibaba Group’s Singles’ Day, Black Friday, Cyber Monday and Lunar New Year, are known to offer huge potential for e-commerce businesses looking to boost sales and attract new customers who are eager to stretch their dollar.
However, a recent report from Rakuten revealed that in today’s challenging macroeconomic environment, 62% of consumers in APAC are more prone to checking prices and 45% are cutting back on unnecessary spending. Although some expect this may put a damper on consumer spending ahead of this year’s shopping season, it might be a timely opportunity for businesses looking to offer inflation-busting deals and discounts.
In fact, last year, 130 brands surpassed $13 million in sales in the first four hours of the 11.11 Global Shopping Festival, topping $153 billion in total. If this success is a signal of what’s to come this year, shopping festivals aren’t going anywhere—and in many ways are more important than ever before.
While offering hot deals and promotions is the first step for many merchants participating in shopping festivals, many can make the mistake of turning a blind eye to the consumer experience and, in particular, payment preferences.
Paying Attention to Payments
There’s no point offering the best deal in town if a customer can’t checkout. In a recent report, Statista estimated that in Q1 2023, the average global e-commerce shopping conversion rate was 2%.
Once a consumer decides to complete a purchase, a seamless user experience and catering to local payment preferences plays a big part to truly optimizing conversion rates. Merchants have to pay attention to payments, the final hurdle. Even the slightest flaw in a payment offering can mean lost revenue, lost customers and lost opportunity. It might seem simple enough, but there’s no one-size-fits-all approach when it comes to payments, particularly in the fragmented APAC market.
A common mistake merchants make is to base their payment method selection solely on the characteristics of their home market. Payment methods have different flows, ranging from QR codes to redirecting customers to specific payment apps. Simply adding a payment method is not enough to guarantee higher conversion rates—the same payment method can yield vastly different conversion rates even within the same industry vertical. The differentiating factor lies in how merchants tailor the payment flow to meet their customers’ expectations to genuinely create a customized experience, a shop-for-one.
Businesses need to offer the right payment method for the right industry vertical and region they are targeting. More often than not this means having multiple payment methods to cover different customer preferences, enabling merchants to tap into different segments of their audience in the same market.
Optimization and Future Proofing Are Key
It’s easy to fall into the trap of setting up payments and expecting customers to come rolling in. Once a business has won a customer, and they’ve made their way to the checkout, there are a few simple steps they can take to optimize conversions. For example, adding a description of the next step can lead to a remarkable 20% conversion rate increase. Similarly, placing the most used payment method at the top of the list on the checkout page makes paying quicker and it gives that familiar local consumer experience, ultimately increasing conversions.
This step starts long before the seasonal sales kick off—while it needs time and attention, it can save a lot of effort and troubleshooting later on. Merchants must test their payment flow to ensure it truly delivers a hassle-free payment experience for their customers. This could mean engaging volunteers outside of the business to test the payment flow on various devices to help identify bugs, glitches or usability issues that could hinder conversions. Merchants should leverage the relationships with their payment acquirers to ensure the flows are tested and bug free before the high volume season kicks off.
When a transaction does fail, businesses should have a playbook to address and rectify it. They should also make it straightforward for customers to pick up where they left off.
The world of online payments is complex. But by avoiding common mistakes and prioritizing the right support and market education, merchants can enjoy a prosperous shopping festival season with supercharged conversion rates and record breaking sales.
