When is it time to say “goodbye” to PayPal?
There seems to be this understanding that PayPal is sort of a beginner’s payment solution which eventually leads to the establishment of a traditional Merchant Account as an online business matures. While this certainly may have been the case years ago, today site owners have the luxury of using both from the start. As such, it might be time to review the place of each as it relates to the online consumer experience.
Website payments, cart systems, etc.
For those accepting standard PayPal payments via your website, you might find our opinion a bit curious considering we are in the Merchant Services business, but here it is… You may well benefit by accepting payments in a variety of ways whether Merchant Account, PayPal, Google Wallet, Online Checks, etc.
It is to your advantage to give your customers their preferred payment option at checkout whenever possible. Providing extended payment options increases sales in addition to minimizing the number of abandoned carts. The easier and fluid you make the checkout process, the more likely it is that your customers will follow through.
Preferred Payments & Customer Payment Reflexes
Think about your payment reflexes for a moment. When you need to pay for a retail item do you reach for cash? A debit or credit card? A checkbook? Many of us prefer our debit cards to carrying cash while others are just the opposite. These types of reflex behaviors also translate to the manner in which we pay online.
Customers do have payment preferences, but it goes beyond that; they also have a “payment reflex.” For customers who prefer to pay via credit card, using PayPal to facilitate the transaction is awkward. It takes the customer away from the merchant’s website and turns the pending sale into an opportunity to solicit a PayPal account. This breaks up the cadence and flow of the shopping experience and interrupts their preferred payment reflexes. So while technically your site might accept credit cards, in a practical sense, you may still be turning away potential sales.
For years this tradeoff was acceptable for many online merchants as securing a merchant account was considered a long and difficult process reserved largely for established retail outlets. But as with most things related to the internet, things evolve, as has the payment processing industry. These days, a standard Merchant Account is easier and faster to secure than ever.
As for the PayPal premiums paid for extended monthly services, we’ll simply say this: At such point as you start to pay 3.4% in addition to a 50 cent transaction fee and $30 per month for the luxury of having a Virtual Terminal, it’ probably time to consider a review of your current solution.
So rather than lamenting whether it’s time to migrate away from PayPals standard service, just consider enhancing the checkout experience for those accepting credit cards by utilizing a traditional merchant account. The variety of payment options, in addition to the fluid nature of your checkout process, can help your conversion rates. Not to mention, you can have greater value while also saving money.