Getting Online Checkout Right

Online sellers are starting to take a closer look at their checkouts. No wonder. The technology plays a key role in whether they can tap into the boom in e-commerce.

Checkout is the point at which the consumer either completes her purchase or doesn’t. A checkout process that is slow or cumbersome, or produces surprises for the shopper, or is disrupted by technical glitches, will likely cost a sale. No wonder, then, that checkout technology is taking on a higher profile.

A recent survey by Paysafe Ltd. of 1,100 small and medium-size online businesses revealed that 74% of respondents saw checkout as a competitive advantage. Yet, 31% of respondents that have experienced issues that turned off shoppers during checkout reported lost sales of upwards of $100,000.

What are some of these issues? It’s a full list, including: system slowdown, declined payment authorization, too many steps in the process, failure to disclose all taxes and shipping costs early in the process, merchants asking for too much personal information, requirements that customers leave the merchants’ site to complete checkout, and consumers not seeing their preferred payment method.

Indeed, cart abandonment has many causes (“The $100-Billion Question,” December), but problematic checkouts rank high among them. “The checkout experience needs to be simple, clear, and efficient, because it has a direct impact on the checkout conversion rate, and increased sales for merchants,” says Keala Gaines, payments general manager for e-commerce platform provider WooCommerce.

A simple, streamlined checkout that allows consumers to complete a purchase in as few clicks as possible can’t be overemphasized, payments experts say. Indeed, no step within the checkout process is too tiny to be overlooked.

A particularly besetting problem is slow checkouts. Two of the simplest ways to speed checkout are to provide autocomplete capabilities for a consumer’s name and address and to allow repeat customers to enter stored card information using autofill. While such features may seem obvious, fully 51% of online checkouts don’t use autocomplete capabilities, says Josh Ackerman, a product lead for Stripe Inc.

Other bumps in the road include failure to display a numeric keypad, as opposed to an alphanumeric keypad, for entering card numbers, and neglecting to flag data-entry errors in real time, as opposed to after the pay button has been clicked. About 60% of online merchants don’t flag data-entry errors during checkout in real time, according to Stripe.

“These are the types of optimizations essential to removing needless friction from the checkout experience and are low weight for merchants to add,” Ackerman says. “These kinds of optimizations may seem minor, but they are viewed as highly important by consumers during checkout.”

WooCommerce, and other e-commerce platform providers like Shopify Inc., use Stripe’s payment software, which has such features as autocomplete and real-time flagging of data entry errors built-in.

‘Every Click, Every Keystroke’

One sure way to put off a shopper is to display unexpected shipping costs, taxes, and other fees late in the checkout process. Lack of transparency about fees at the outset can lead to sticker shock for consumers when they see the final tally for their purchase. If the cost is too high, they could walk away. Unexpected shipping costs, in particular, are a leading reason for cart abandonment at checkout, payment experts say.

“If customers are less surprised by the total cost, they’re more likely to complete the purchase and become a repeat customer,” says Saumil Mehta, head of point of sale and e-commerce for Square Inc. “[Merchants] should make sure that all shipping, taxes, and any other fees are transparent during the checkout process.”

One way to increase transparency for shipping costs is to provide supporting information or links on product pages, especially if the merchant can geolocate the customer through the device being used to make the purchase.

“Let shoppers know where they can get information they need about shipping [fees and taxes] before they hit the checkout page,” says Frank Keller, head and general manager of merchant and payments for PayPal Holdings Inc. “An informed and curious customer will likely explore this information before getting deeper into the checkout process and will have a clearer sense of the total cost for the order.”

It is also a good practice to inform shoppers that the cost to ship an inexpensive or bulky item can exceed the actual cost of the item itself, Keller adds. Plus, shoppers should be informed about restocking fees and return policies during checkout. The latter can be especially important to consumers purchasing a product they may end up returning, such as apparel. A recent study conducted by Happy Returns, a PayPal company, found that nearly half of shoppers have abandoned checkout because there was not a convenient return method available.

Having coupons or other promotional redemptions incorporated in the shopping-cart calculation, as opposed to after payment is selected, is another recommended best practice for bringing transparency to checkout, payment experts say.

While it is common for e-commerce merchants to gather as much data as they can from their customers for marketing purposes, asking customers for too much information at checkout, such as whether they want to subscribe to the monthly newsletter or receive email promos, can make checkout too cumbersome. Asking for that information should be done after the transaction is complete, payment experts say.

“Every click, every keystroke moves the consumer further and further to completing the transaction, so merchants should strive to ask for as little information as possible in order to allow consumers to reach the end page and complete the transaction,” Rob Gatto, chief revenue officer at Paysafe.

Tracking Payment Options

Not surprisingly, payment options play a key role at checkout. Merchants should offer a variety of them to ensure they are meeting consumers’ payment preferences, experts advise. Credit or debit cards, digital wallets, local payment options, and buy now, pay later programs are some of the payment options merchants should be offering. BNPL, in particular, is becoming a must-have, as it is especially popular among younger shoppers and plays a role in attracting new customers.

“In some markets, it’s almost a requirement to offer BNPL, and in some cases merchants need to offer multiple BNPL options,” says Mark Rosales, vice president and general manager, payments, fintech and banking, for e-commerce platform provider BigCommerce Pty Ltd. “Offering multiple BNPL options is not cannibalistic if consumers use all of them.”

But even having the right mix of payment options is not enough. Payment options must also be prominently displayed, and even rank-ordered by popularity. “Having a consistent and concise list of payment methods will prompt the consumer to easily choose the preferred payment method,” says Chris Petersen, senior vice president of partnerships and core verticals at Paysafe. “Also, the platform should track the most-used payment methods with the biggest conversion rate, and then show them first, which will surely optimize the experience.”

Another option for optimizing checkout is to break the process into two to three steps, as opposed to trying to collect every piece of payment, shipping, and customer information on a single page. For example, sellers could break a checkout form up into two or three separate steps as part of a series of steps in the checkout routine, says WooCommerce’s Gaines. Payment details, for example, could be entered separately from shipping details. To make the process even smoother, the form for shipping and billing addresses could be enhanced with auto-fill capabilities.

“Although it can be tempting to make a long, detailed form collecting every piece of info from a customer on one page, it’s advisable to break a checkout form up into two or three separate steps as part of a series of steps in the checkout,” says Gaines. “Merchants can also offer auto-filling of pre-filled fields at checkout for things like addresses and checkboxes for same address for billing/shipping.”

‘Make it Easy’

When breaking the checkout process into steps, merchants should be cognizant, however, to have no more than three to five steps in the process, Gaines adds.

Another tactic is to enable customers to save their cart information should they unexpectedly leave the checkout page while letting them know their carts will still be in place when they return. For customers who have left their cart at checkout, but have an account with the merchant, an emailed reminder that they have left items behind could save a lost sale. The same reminder could also be texted to an app, provided the customer has opted in for this option.

“Saving a buyer’s cart and cart-abandonment emails are two key ways to make it easy for shoppers to come back and complete checkout,” says Square’s Mehta. “Businesses can give those carts a second chance by sending friendly reminder emails, prompting them to complete their purchases, all while keeping their business top of mind.”

While there are many options to optimize checkout, merchants should always test any new enhancement to checkout before rolling it out.

“Whether it’s content on the checkout page, colors, payment options, where buttons are located, or the number of steps need to complete checkout, merchants need to be testing the elements of the checkout process,” says BigCommerce’s Rosales.

Finally, sellers should remember not to complicate checkout with distractions, such as pop-up ads or marketing messages, that can prompt shoppers to click on links that lead them away from the checkout page and subsequently cause them not to complete the transaction.

“If the checkout process is too complicated, it leads to abandonment,” Rosales says. “If merchants can provide the right checkout experience, consumers will bite [and see the purchase through to the end].”