Monday, March 28, 2011

How to Close Deals With No Credit

Are you looking for more revenues for your internet business? Tired of all the web page statistics showing how many people abandoned your checkout page without a purchase?

If you’re one of the many internet businesses feeling this pain….then I have a solution for you!

Let’s start by figuring out why so many people don’t complete their on-line purchases. There are a couple of main reasons….

Price….Many people, like it or not, use the internet to comparison shop. They’ll “Google” a product before going to a local store to set a price point for the item. Once they get the price point they’re willing to pay, many consumers will then continue their shopping, searching for the lowest price…period. These consumers might return and make a purchase, they might not. These are the hardest abandons to close. Your only tool against these customers is simple…..keep your price competitive!

Trust….if you’re a digital merchant selling through sites like Amazon, pay close attention to your ratings. Email follow ups to consumers who’ve recently purchased your product, asking for a recommendation, are an absolute necessity. Make this a priority. Good reviews help increase your rating as a merchant and increase sales. Every Customer wants to think they made a good decision, and buying from a merchant others have trusted reinforces this emotion.

Payment methods…this is an important one.

Does your checkout page contain purchase options other than credit card or check? If not, you need to add them. Consider adding Paypal. Paypal can be set up quickly on-line and allows consumers a safe alternative to revealing their credit card information. Paypal helps to eliminate payment security concerns for many consumers. However, even if you add Paypal, there is still a sizable group of consumers who for a multitude of reasons, simply will not make a credit card purchase on line.

This could be caused by identity theft concerns, credit limit issues, lack of a credit or debit card, or a simple aversion to using any type of recurring credit. Problem is, this group of people can represent up to 20% of your potential customers who do not have access to traditional credit (http://tinyurl.com/ybaecdv )

So, how do you make sure you have a purchase option available to 1 out of every 5 potential customers? By adding a “Bill to Phone” option.

Landline phone billing for digital goods has been around for many years and has developed a mixed reputation because of some past fraud from some of the merchants. While this was a troubling trend in the past, the local phone companies (like Verizon, CenturyLink, and AT&T) and the billing clearinghouses (like ILD Teleservices) have worked hard to clean this payment method up to the point that it is now a truly valuable asset to add to your online business. Merchants will go through a stringent approval process before the OK is given to begin Local Exchange Billing (more commonly referred to as “LEC Billing”) with the phone companies.

The rapidly growing mobile phone market has added yet another curve to the phone billing market. Early returns a couple years ago using “Premium Short Message Service” or otherwise known as “PSMS” billing methods had mixed results for merchants.  The merchant would ask the consumer to enter their cell number on the checkout page and then the consumer would receive a text message which, if accepted, would automatically add a predetermined $ amount to the cell bill.  The consumer would then receive a code to enter on the checkout page to complete their transaction.  As the wireless companies kept a sizable portion of the sale, the returns were poor, representing typically less than 50% of each dollar being passed through to the merchant. The PSMS method did increase closed sales, but because the returns were so low, it wasn’t fully accepted as a truly viable option.  If you're still utilizing this method at your company....keep reading.

Today, the brand new concept of direct “Mobile Carrier Billing” allows merchant to place a product directly onto a potential customer’s cellular invoice and list the merchants name on the bill, reducing chargebacks and adjustments. Returns have improved to match or even exceed the returns realized through landline phone billing and provide a valuable tool to help e-merchants close the sale with that “1 out of 5” consumer who doesn’t have access to traditional credit. E-merchants will typically see a 20% “lift” in sales when they implement a bill to phone campaign, utilizing both landline and cellular billing. “Direct Mobile Carrier Billing” can be set up and approvals received to start billing as quickly as 3 weeks, meaning within a month, you could be closing sales with the group of “1 out of every 5” consumers that you cannot sell to today!

If you are interested in learning more about adding a “Bill to Phone” program to supplement your current e-merchant business payment options, contact me @davehanron on Twitter or via e-mail at Dave.hanron@ildmail.com. My company has processed in excess of 1 billion phone billing transactions and can help your business gain access to this growing market.

I’d enjoy hearing any experience you may have had in the e-merchant sales world, good or bad…..after all, we can all learn something new each day……

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