What every retailer should know to optimise payment experiences

Every interaction with your brand is more than a transaction - it’s an experience that defines how customers perceive your business. From browsing to checkout, every step shapes their journey, and a positive experience is what turns one-time buyers into loyal customers.

The payment process is the final and often most critical step in this journey. As the last touchpoint, it leaves a lasting impression. Customers expect payments to be reliable, secure, and convenient. Simplicity is key: fewer steps mean less friction, and less friction leads to higher conversion rates.

To meet these expectations, retailers must address key questions: How can I provide a secure checkout experience wherever my customers are? How can I tailor payment options to suit each purchase? How can I use automation to eliminate unnecessary steps? And how can I use clear branding and contextual cues to build trust and minimise fraud?

With the holiday season fast approaching, now is the time to refine your approach. Here are five essential strategies every retailer should know to optimise payment experiences and drive sales.

1. Improve Payment Security: Reduce Fraud, Chargebacks and Data Breaches

In 2023, global retail lost $429 billion USD to payment fraud, with nearly half of all businesses experiencing cyber-attacks or data breaches - an increase of 32 percent from 2022. Businesses targeting strong revenue growth in 2024 saw the highest fraud losses, totaling $196.4 billion USD.

These numbers highlight the need for fast-growing businesses to invest in secure payment technology. Important steps include using data encryption, tokenisation, strong access controls, and ensuring compliance with global security standards. Open banking, as an alternative to card payments, can significantly reduce chargebacks. Recent studies show a 61 percent decrease in fraud this year, thanks to encryption and real-time authentication through open banking APIs.

2. Reach Customers Anywhere: Simplify Checkout with Pay-by-Link Solutions

Advanced pay-by-link solutions allow you to bring the checkout to your customers, wherever they are. Whether they are running errands, walking their dog, or commuting, customers can complete purchases on the go. You can send a secure, merchant-branded payment link via SMS, email, webchat, or messaging apps, offering multiple payment options based on their preference. It’s seamless, secure, and gives customers full control over when and how they pay.

Pay-by-link integrates with social media and messaging apps, allowing customers to make purchases directly from live videos using multiple payment options. Live commerce conversion rates can be up to 10 times higher than traditional e-commerce, with global social commerce revenue expected to surpass $1 trillion USD by 2028, fueled by platforms like Facebook, Instagram, TikTok, and the rise of influencer marketing. Pay-by-link allows you to tap into this immense potential.

3. Maximise Payment Success: Leverage Smart Orchestration Tools

With smart payment orchestration, retailers can offer a variety of payment methods while guiding customers to the most appropriate option based on transaction value, type, or location. This approach optimises the payment experience for both retailers and customers.

For example, a car dealership might accept card payments for deposits but require open banking for the final balance. This provides customers with credit card protection while helping merchants avoid high fees on larger transactions.

Optimising payment options increases conversion rates, reduces costs on high-value transactions, and creates a smoother experience. With open banking, or Pay by Bank, retailers save on interchange fees, reduce fraud, and lower operational costs. Customers can pay directly from their banking app in just a few taps, without entering lengthy account details. It’s a win-win for both sides, and a safer alternative to high-value card payments.

4. Build Trust: Use Context-Driven Communication and Consistent Branding

Provide context during the remote checkout process to reduce fraud risk and improve the customer experience. If a customer has interacted with Ben in the showroom, include Ben's name along with your brand name in the payment request. Highlight important details like payment initiation time and purchase information. This enables customers to review and confirm all details before completing their payment, giving them confidence to proceed. If something seems off, the process should help identify discrepancies, allowing customers to decline the payment if necessary.

Keep the checkout simple and smooth with clear layouts and minimal form fields. Maintain consistent branding throughout the payment journey by using custom design elements and cohesive messaging to create a personalised experience that strengthens brand recall. Ensure intuitive navigation with prominent buttons and clear steps to guide customers through. Remove barriers, such as unnecessary pop-ups or complicated verification steps, to reduce cart abandonment.

5. Streamline Operations: Harness Data Analytics and Automation

Tools like live tracking, reporting, and analytics help retailers capture valuable data from online and in-store transactions, and uncover customer preferences for payment and delivery options. These insights allow you to address cart abandonment, refine the checkout process, and remove friction points. Retailers can re-engage hesitant customers with timely incentives like discounts or free shipping, and automate chase paths for failed payments with alternative payment methods. Additionally, features such as card-on-file storage, recurring payments for subscriptions, and staged payment plans help simplify the payment journey and increase success rates.

To create a standout payment experience, focus on security, simplicity, and convenience. Where relevant, utilise pay-by-link solutions, smart orchestration, and clear communication to reduce cart abandonment and boost conversions. With the power of data and automation, you can streamline your checkout process and deliver a seamless journey that keeps customers coming back.