Insight from CyberSource: Providing a frictionless and trustworthy eCommerce experience

Aug 16, 2013 (Thu): Today, 44.8 percent of the World Wide Web’s 2.4 billion users are located in Asia Pacific[1]. Analysts predict that annual growth rates in mature eCommerce markets, such as Australia, Japan and South Korea, will run at 11 to 12 percent over 2011 to 2016[2]. Growing even faster will be emerging markets such as China and India, with growth rates expected to hit 25 percent and 57 percent respectively[3]. The Internet and growing popularity of eCommerce has transformed the way we shop online, which is why merchants need to integrate robust payment facilities into their online stores to maximize their eCommerce platforms.

The consumers’ buying journey begins from the moment they browse the merchant’s online catalogue, add to their virtual shopping carts, and eventually move to payment and fulfillment.

Michael Bradley, Managing Director, Asia Pacific, CyberSource, discusses the customer’s payment journey and why good planning and design of the eCommerce architecture – which integrates these stages in the customer’s journey – will ensure a seamless and secure transactional experience.

A seamless, integrated experience

The increasingly sophisticated consumer has multiple platforms at his disposal when shopping, and is no longer limited to just browsing an online store using a web browser on his laptop. These new platforms also include mobile, interactive voice response (IVR) and more. Customers are also highly adept at switching between these platforms and their related devices to access the products they want.

For both the merchant and the customer, the payment stage represents a crucial step in an eCommerce transaction. For the customer, clicking on the ‘pay’ button symbolizes the commitment to complete the transaction. For the merchant, this is where revenue is recognized. To convert clicks into revenue, merchants need to ensure a smooth online experience for the customer – from order, to payment, to delivery.

In order to ensure a convenient and secure customer experience across all different fronts, integration of information and function across all channels – such as maintaining a single consistent user profile per customer, and ensuring continuity of shopping sessions across interfaces – is key.

Understanding payment management

The choice of payment methods that merchants can offer to consumers is constantly evolving. A variety of payment acceptance of methods such as cards, electronic checks, bank transfers or alternative payment methods such as gift cards or digital wallets, improves the online checkout experience and in turn, its popularity.

Payment gateways act as the ‘middlemen’ between merchants and their sponsoring bank (a bank that has obtained membership in a card provider, allowing a processor access to the card networks and enabling the processing of different types of transactions), securely transferring payment data and processed information among the consumer, the merchant and the payment processor. It is vital that merchants are supported by payment gateways that connect to the processor used by their sponsoring bank. This allows a higher volume of transactions to be processed reliably and quickly.

Selecting the right payment processing platform is a key consideration to handle authorization and capture, clearing and settlement functions, while ensuring smooth handling of the transactions and connections to the payment networks. This will allow merchants to easily scale and expand to other countries.

Another important aspect is payment security. Merchants need to track and secure their payment data across the full order lifecycle, covering payment acceptance, fulfillment, financial reconciliation and transaction record storage. With so much valuable and sensitive data collected from the customer, merchants need to then consider how they should store and manage it.

One way is to keep the data within the organization; however, this may require significant upfront investment to mitigate risk. Alternatively, merchants could utilize tokenization or simplify the management of the information by opting to use Payment Card Industry Data Security Standard (PCI-DSS) compliant hosted solutions. Hosted solutions may be the most beneficial for merchants as they allow payments to be carried out seamlessly, eliminating the added burden of having to securely store confidential payment data.

Elevating the transactional experience

As eCommerce grows in popularity in Asia Pacific, more merchants are increasingly seeking to add robust payment capabilities to their websites. Merchants should seek to understand how payment management plays a prominent role in their eCommerce platform. They should look towards implementing a payment management process that can successfully transform any website into an effective and secure eCommerce portal.

With an effective payment management platform, merchants will be able to deliver a secure and integrated transactional experience for both themselves and their consumers. This ensures that they have a scalable and robust payment foundation, and a greater chance of turning international browsers into potential customers.

Michael Bradley, Managing Director, Asia Pacific, CyberSource

[1] Internet World Stats, http://internetworldstats.com/stats3.htm#asia
[2] Forrester, ‘Asia Pacific Online Retail Forecast, 2011 To 2016: A Look at Growth in Five Markets with a Focus on China, Japan, and Australia’, April 2012
[3] Forrester, ‘Asia Pacific Online Retail Forecast, 2011 To 2016: A Look at Growth in Five Markets with a Focus on China, Japan, and Australia’, April 2012

Author: VSDaily Editor

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