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63.236.73.192/solutions/secure_pay/article.php/3709881
By Sally Curran November 8, 2007 Other Options for Closing the Sale As far as non-credit options go, clearly PayPal is one stand-out option. If someone has money in a PayPal account from an eBay sale, for example, he or she could use that money instead of credit. Bank/wire transfers are also an option, and some sites, including Amazon.com, will let you send a check (with the caveat that it receives your payment and the check clears before anything is shipped). Sites such as PayByCash also offers several ways to pay without credit. Not every alternative payment method solely offers a way to transfer cash. Alex Rampell, cofounder and CEO of TrialPay, explained that his company's product acts as an incentive program and never really enters the fray of the payment page. TrialPay works its magic by turning site browsers into buyers. It works with the merchant to place offers on checkout pages that customers can click instead of actually buying the product. For example, take McAfee. So many consumers receive the product free with a new computer and balk at actually paying for the product. TrialPay enables the consumer to purchase an advertiser's product or service and receive McAfee free of charge. The merchant receives a fee from the advertiser in return. To sign up, merchants (and advertisers) can head to the TrialPay Web site and simply register. Hunt noted that alternative payments build consumer confidence, provide control of information and speed purchases along, as well as provide payment choice. Adding just one or two alternative payment options can increase conversion rates 63 percent, he said. Three or four payment methods can push conversion rates to 72 percent. Furthermore, Hunt said that by offering only credit cards as a route to checkout, 5 percent to 10 percent of potential U.S. buyers turn away. He went on to add that every day, there is $2.5 billion in PayPal accounts, and that money turns over every two weeks. It has penetrated the market seven times faster than credit cards and deals in 74 currencies. In Q2 of this year, it handled $172 million in transactions, which works out to $1,500 per second. One option that does not rely on credit cards or PayPal is BillMeLater. The first time a consumer uses BillMeLater, he or she enters her birth date and the last four digits of his or her social security number. Together with the purchaser's name and shipping info, BillmeLater approves the customer within three seconds. BillMeLater pays the merchant and then bills the customer at a later date. Customers can pay online or send a check or money order, but cannot use plastic or PayPal. Integration usually takes four to six weeks and requires a processing path for authorization and settlement. For those who are fans of the paying in installments, there's eLayaway. This service lets a consumer reserve a product and make payments on it. The purchaser registers for an eLayaway account and creates a payment plan. The service sends reminders when payments are due, and automatically deducts payments from the buyer's checking account. It's basically a preordering system. To integrate, merchants follow a quick three-step process (beginning with registering for a merchant account) that makes their site eLayaway-ready within minutes. Negate Naysayers Anything new, though, is going to have its skeptics. Some might say there are so many options, that it's nearly impossible to choose an alternative payment program for a site. Mulpuru said that a VHS-Betamax shakeout is unlikely in the foreseeable future. Each alternative payment has a demographic, so by offering more than one, a retailer will be able to hit different markets. There's also some fear of being an early adopter and having to deal with what that entails. Mulpuru said that most of these programs, such as BillMeLater, have been around long enough to have the kinks worked out. Finally, there's the challenge of site integration. She said while it's not always easy at first, it's always worth it when sales start rolling in from previously untapped markets. Mulpuru noted that merely plopping a PayPal icon on the checkout page won't guarantee increased sales. E-tailers need to advertise payment options on the front pages and early in the shopping process and ensure that that staff is adequately trained to answer customer questions when problems arise. There are so many hurdles to running a successful business online, you need every advantage you can get. As Hunt said, "Don't let payment choice get in the way of a sale." Sally Marek Curran is a regular contributor to ECommerce-Guide.com.
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