The problem is that the payment methods most sought after by customers often entail the highest risk for online merchants. While British consumers tend to prefer credit cards, the most popular online payment methods for German shoppers are purchase on account (28 per cent) and direct debit (22 per cent), according to a 2015 study on online payment carried out by the EHI Retail Institute.
For consumers, purchase on account has only benefits. For merchants, however, this payment method primarily leads to increased costs due to audits, returns, payment delays or even defaults. Nonetheless, shop owners benefit enormously from the positive effect this method has on conversions. If it’s not possible to avoid charging fees for certain payment methods, customers are most likely to be persuaded by transparent and logical explanations.
Sales trends by payment type 2013–2014
Source: EHI-Studie, Online-Payment 2015 (EHI Retail Institute)
Consumers’ online behaviour is marked by constant change due to the rise of various devices. Currently, the growth of responsive web design illustrates that customers want to use the same familiar payment methods anytime, anywhere, across all devices. This means a customer-oriented payment mix remains is fundamental in purchase decisions and must be taken into account in order for online merchants to operate successfully in the market.
Missing payment method most common cause of abandonment
Reasons for abandoning your last online purchase
Source: Respondents German internet users in total Fittkau & Maaß: W3B-Report, «Kaufentscheidung im Internet» (Purchasing decision on the internet), 2014. © 2014 Fittkau & Maaß Consulting