The rise of e-commerce and online shopping is continuing to change the landscape of the economy — the digital economy has taken center stage. In fact, e-commerce statistics show that e-commerce retails sales are projected to reach a staggering $6.5 trillion by 2023. Many companies are scrambling to adapt to the rising tide in e-commerce and the digital economic boom. A few ways they are looking to prioritize e-commerce include:
However, the demand for mobile optimization among online consumers also brings with it legitimate concerns. Pew Research states that among mobile users, nearly 30% avoid making mobile payments due to security concerns, preferring the use of debit or credit cards alone.
Even with the rise of e-commerce and online shopping, there are still barriers for some shoppers, such as the use of payment gateways or payment processors and questions of overall payment security. This issue can leave many businesses with abandoned carts as customer concerns arise.
Payment gateways are an extremely important component of the online shopping experience. Simply put, payment gateways provide merchants with a means of processing credit card payments and purchases on e-commerce sites; it acts as a digital cash register during electronic transactions between the business and the customer.
Businesses of all shapes and sizes need a means of accepting and processing payments. Payment gateways allow this to be done securely, whether digitally or in person.
However, it is important to understand that payment gateway and payment processors are not synonyms. A few entities are involved with every credit card transaction — the business, the customer, the issuing bank (issued the credit card), and the acquiring bank.
Payment processors merely analyze and transmit data from the transaction between involved financial parties (think of “swiping a card”). In contrast, a payment gateway is a tool that does this as well. However, it also authorizes the transfer of funds between the business and the customer—often digitally.
Non-hosted, or on-site payment gateways, allows businesses to collect and process payment transactions on-site; no third-party processing. This is convenient for the customer, but this method is usually most popular among large corporations that can handle the extra maintenance of hosting their own payment gateway.
Self-hosted payment gateways do not redirect customers off of a merchant’s website. All payment transaction data is sent to a third-party payment gateway—it is processed off-site.
A hosted payment gateway takes customers off a merchant’s page (redirects them) to a payment gateway page where the payment is made. Once the payment transaction is completed, customers are redirected back to the merchant’s page. Hosted payment gateways are great for small retailers that want the security that comes with big-name payment platforms — like PayPal. Of course, this means multiple steps for the customer.
Shopify is a popular website builder devoted to e-commerce and the digital economy. It offers businesses of all stripes the ability to create a scalable online storefront to sell their products or services. Shopify is primed for mobile optimizations, allowing merchants every opportunity to maximize SMS marketing.
Furthermore, Shopify helps merchants navigate the payment process by allowing them to integrate various payment providers. Shopify supports two types of payment providers: direct providers and external providers.
Now that we have a better understanding of the types of payment gateways let’s take a look at the top Shopify payment gateways for each type: On-site, Self-hosted, and redirect.
Shopify Payments must be mentioned in the talk of top Shopify payment gateways. Merchants will enjoy the simplicity of Shopify’s own on-site payment gateway, as it eliminates the need to integrate and set up third-party payment providers. Shopify Payments are streamlined to automatically set up payment methods with most major providers once a Shopify store is created.
Since Shopify Payments is an on-site payment gateway, the setup for online merchants is seamless. Merchants need only:
Shopify Payments can be used in most countries, including Canada, Australia, United Kingdom, and the United States, to name a few. It also accepts most major payment methods: Visa, MasterCard, AmEx, Discover, Apple Pay, and Google Pay.
Shopify Payments offer fraud analysis on all plans. Cost and rates vary based on the Shopify plan but decrease upon upgraded subscriptions. Online credit card rates are as follows:
Authorize.Net has been around for a long time. It provides payment processing and management and is easily integrated as a self-hosted, third-party payment gateway on Shopify e-commerce business platforms.
Authorize.Net offers two options for merchants:
There are no setup fees, but both require a monthly gateway fee of $25 with varying transaction fees depending on the plan.
Apple Pay, PayPal, and Visa Checkout are available. In addition, eCheck processing is available with Authorize.Net.
Authorize.Net allows users to create customer profiles with customer management features, recurring payments or billing options, as well as the ability to add shipping locations. Advanced fraud detection filters help protect through monitoring of suspicious transactions and IP address activity.
PayPal is perhaps the biggest name in the payment gateway world, familiar with most merchants and customers alike. PayPal is already set up as one of Shopify’s default payment providers. Users are automatically set up with a PayPal Express Checkout account upon Shopify setup.
Merchants can sign up with PayPal for free, only needing an email address. To get paid, businesses need to link the necessary banking information. Credit card rates are comparative to other payment gateway providers; 2.90% + 30¢ for online transactions.
PayPal allows users to utilize customer purchasing data to help make better business decisions in the future —providing important shopper insights to merchants. With its worldwide reach, PayPal allows merchants the opportunity to engage new customers internationally.
The PayPal business resource center allows merchants to join community forums, browse numerous article resources, from growing businesses to case studies, and provide a resolution center to solve transaction disputes.
You have numerous payment gateways options to choose from when looking to get paid for the products or services you sell on Shopify. Some are tailored to benefit the merchant, and others seek to streamline and optimize the customer purchasing experience through checkout. The payment experience should not be a roadblock to the customer.
Unfortunately, one of the biggest reasons for cart abandonment is an experience that leaves the customer with unanswered questions, many of which come as a result of the payment process. Shopify is not immune to this issue. Fortunately, LiveRecover does provide an option for those merchants that are tired of seeing abandoned carts.
Integrating LiveRecover with your Shopify store allows you to recover some of those unrealized sales. LiveRecover uses actual humans to contact those would-be customers with highly personalized SMS messages to win them back for you. Of course, some payment gateways and e-commerce apps provide versions of abandoned cart support, but they rely on automation for generic, impersonal responses from bots.
So, as you work to find a payment gateway that works for your business, don’t forget to maximize your company’s bottom line with SMS tools that seek to recover those sales that did not make it to the finish line. Feel free to get in touch with LiveRecover today if you have more questions about abandoned cart recovery.