Friday, January 22nd, Leon Thomas was part of a panel of ecommerce experts at First National Merchant Services Merchant Days.  Other members of the panel were Matt Price from Visa, Tyler O’Brien from PayPal, Tim Spear from Tangible and Carla McAnulty from Authorize.net.  

The first question to the panel addressed common issues that merchants face when starting an ecommerce site.  The first answer was “knowing their customer”.  When starting a small brick and mortar store, merchants can see their customers and do some screening by sight.  With an ecommerce business all transactions are done without ever meeting your customer.  Some things that merchants can do is monitor for suspiciously large orders, special payment terms, and many new accounts being opened in a short period of time.  The next answer was “education”.  Opening an online business requires knowledge of ecommerce practices, PCI compliance,  payment options, and more, which merchants often overlook.  The last three answers agreed largely with the first two, with the additional advice to do more outsourcing when accepting payments, allowing vendors to assume the risk of payment acceptance.  

Other points of note from the panel were:
•    The industry is working towards eliminating all card data after the initial authorization, rendering stored data useless
•    Hosted payment forms are a good alternative for PCI compliance
•    Merchants need to consider purchasing pre-packaged solutions and integrating with best of breed applications
•    Merchants often don’t understand what a payment gateway is, it is important to get educated and use one for all transactions
•    Online credit card fraud has declined by 18%, but has increased that much and more in areas such as electronics

Ways to drive online sales that were mentioned were:
•    Online advertising
•    Product feeds
•    Cross polication with other sites
•    Don’t limit how people give you money (studies show that adding alternative payments can increase conversion by up to 14%)
o    PayPal
o    Bill me Later
o    Direct credit card
•    Usability studies
•    Make ordering simple and fast
•    Subscribing to third party security services that give you seals to place on your site can encourage customers to buy
•    Extended Validation SSL’s are a good way to show you are securing your customer’s data

There were many good questions asked from the audience as well as from the moderator.  I felt like the panel was full of knowledgeable people with a lot of experience in the industry.  I could have asked questions about the future all day!  I’m interested to see what is in store for online payments in 5 and 10 years.  Today I still see the main challenge as education.  Most of our clients do not understand PCI compliance, nor are they concerned about it – but they should be.  They often do the minimum possible to stay in business online.  That is scary if you are a frequent online shopper.

My "adopted daughter" wrote a compelling article for online retailers; she is the Marketing Coordinator for 90octane.  I think you'll find this article informative and timely!

 Visit this link to read the article.