- Kevin Sinclair
Recently I was surfing the web checking out ezine advertising
opportunities. I visited a site that seemed to have what I was
looking for: reasonable size circulation and attractive
advertising rates. I was about to place my order for an ad in
their ezine when I realised that they did not accept credit
cards as payment. Instead, I had to send payment by check or
money order via ordinary postal methods.
I think my reaction to this situation is typical of many
people looking to do business on the web. I did not order
advertising in this ezine. Why? I started thinking about having
to purchase an international money order, the fees I would be
charged for this, the time for an airmail letter delivery from
Australia to the USA, etc., and decided it was all too hard and
that there were other options available to me that were just as
attractive but with less hassle.
This experience reminded me that there are good sound
business reasons to accept credit cards as payment for your
goods and/or services from your web site. I will briefly discuss
these key reasons now.
Increase in orders – stop losing sales.
As can be seen by my real life example above, the business in
question lost a sale. How many sales are lost is unknown but
some sources suggest that an increase of at least 30% in orders
is achieved through accepting credit cards. When you weight up
the cost of accepting credit cards against the increased revenue
generated by the extra orders, there can be no argument against
accepting credit cards at your site.
I think a common mistake can be to underestimate the size of
your market. In the example above, the business may have thought
its market was the USA. However, its service is attractive to
many internationals as well. The lack of credit card facilities
can discourage business with internationals due to increased
costs of alternative payment options and time delays.
Enable impulse buying.
Credit card facilities enable impulse buying. For me, as soon
as I stop to think about a proposed purchase, and start to weigh
up its merits, the chances of proceeding are significantly
reduced. Therefore, anything that causes me to re-evaluate my
purchase decision is likely to reduce your chances of selling
your product or service to me.
These comments relate more to lower priced items than the
higher priced items. However, we should never forget that
inferior quality items would suffer high return rates.
Therefore, if you have a good quality product then impulse
buying should not significantly impact on your return rates.
Instead, your sales should increase along with your profits.
A legitimate business.
Accepting credit cards reassures your potential customers of
your legitimacy. Credit card facilities create comfort and trust
for your customers and credibility for your business. I know
that I have thought, "this isn’t a real business as it
does not accept credit cards".
We all need to be aware of the image our shop front creates
in the minds of our potential customers. Anything that detracts
from the image of legitimacy needs to be addressed quickly or
your business will suffer in the long term. Accepting credit
cards is one item that can help increase your image of
legitimacy.
E-commerce is here to stay.
E-commerce is definitely here to stay. According to Forrester
Research, Online retail sales will hit $108 billion by 2003.
Unless you accept credit cards on your site, you will not be
maximising your ability to share in this growth.
Sell 24 hours a day 7 days a week.
Accepting credit cards enables your site to sell 24 hours a
day, 7 days a week. It doesn’t matter what day or time a
customer visits your site, you are ready to do business with
them. Again you have reduced the potential for a lost sale.
As you can see from the above, there are very sound business
reasons to accept credit cards on your site. Don’t be put off
by the fee levels. Consider the full picture of increased sales
and compare this with the cost involved. Usually, you will
increase your profits through accepting credit cards.
About the Author
Article by Kevin Sinclair, CPA, of Be Successful! Business &
Personal Success Resources (http://www.ksinclair.com). He is the author of 2 free ebooks: "Success
Secrets" & "How To Choose A Home Based
Business". Kevin is also the publisher of "Be
Successful News" - a free ezine dedicated to your online
business success - to subscribe, visit http://www.ksinclair.com/pbs_news.htm
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