Improving authorisation rates increases revenue, leads to better customer satisfaction, and ultimately improves customer retention and loyalty.
Lead generation has been at the top of every ecommerce marketing leader’s agenda for many years. For marketing functions specifically, the focus has always been on driving consumers to your website, optimising their journey through the site, and presenting them with the information and offers that make them want to stay there. Of course, all of this is futile if it doesn’t lead the window shopper to buy.
To achieve this sought-after result, the marketing manager underpins the customer journey with data such as heat maps of where consumers are clicking, their dwell time on critical web pages, and split testing to see what works best for getting a consumer’s attention. For any marketing campaign, be it sales-focused or awareness-raising, getting a grip on this data is key to success. However, whilst these metrics are critical, there is another key metric that has long been overlooked, and to optimise it, marketeers must look beyond the surface of glossy websites and marketing materials when it comes to truly optimising the customer experience.
That metric is authorisation rates, or the percentage of transactions that successfully pass through the full authorisation process to complete a payment.
Put simply; improving authorisation rates increases revenue, leads to better customer satisfaction, and ultimately improves customer retention and loyalty. In fact, PayPal research shows that a two percent increase in approvals could translate into more than a million dollars of previously unrealised revenue.
Steering clear of cart abandonment
Those in the ecommerce industry know all-too-well that cart abandonment is a huge issue, and it won’t go away or improve without action. Customers who have had a poor experience on your website may go online to share their reviews and to warn other potential customers about their negative experiences. This can lead to long-term knock-on effects and severely impact the customer base that your team has worked so hard to build. However, all too often, the issue is not solved because the cause of it is not adequately addressed. To truly optimise customer conversion rates, marketing managers need to understand the pain points a customer faces when making a transaction on their website or app. To aid this, there are experts and resources out there to help when a customer journey isn’t smooth from start to finish, with a simple checkout process, consumers almost certainly abandon their cart, head to a competitor, and never come back. After all, today’s consumers are short on time and their loyalty is hard to keep.
For many, the impact of poor authorisation rates might not have been a consideration in the past when it came to improving marketing metrics. However, in today’s competitive e-commerce environment, marketeers who take the time to look beyond the surface-level metrics that are so commonplace, and fully analyse why those with full carts didn’t complete their transactions, can make huge gains and realise success.
Knowing where to look
When looking at the backend of a website and at payment platforms and pathways, there are some questions marketers should ask; What journey is a customer going on to find themselves at the checkout? Are there too many clicks? Is it too complex? By working out the answers to these questions and determining what elements of the process need improving, optimised payment authorisation rates will positively ripple through the business, and this could be the difference in millions of dollars of profit.
With this information at hand, marketers will no longer be so quick to ignore what has been written off as a seemingly insignificant back-end metric. There has never been a more crucial time to optimise conversion rates.
It is no secret that many industries have been shaken up as a result of the pandemic, but few so much as the ecommerce industry. The last 12-months has seen new demographics of consumers shopping online for the first time, and others convert to completing of the majority of their shopping online as a more hygienic way to get the goods and services they need. To gain their slice of this market, merchants need to be nimble and adapt to consumers wants and needs – those that don’t will get left behind.
The solution is simple and payment platforms offer merchants all the tools they need to optimise conversion rates and capture and grow their slice of the ecommerce pie by ensuring valued customers don’t go to the competition. This end-to-end payment know-how is all marketers need to realise success when it comes to optimising authorisation rates at the checkout.
To future-proof their careers, and strive toward truly optimised metrics, marketing departments must get behind the surface of the data that they have at their disposal and start looking at the full customer journey. There is no doubt that it might seem like a daunting task, but expert support is on-hand.