When considering payment methods on a website, Paypal can be overlooked especially when it’s foreign to you and you don’t “get” it. Below we share our own experience with Paypal, and why we made the switch.
Why we didn’t use Paypal before
We didn’t use Paypal on our own online stores, because we didn’t really like it. Some issues we had were:
- We didn’t like how it tried to sign the client up to Paypal every time.
- We didn’t like the high fees (as much as 2.4% + 30 cents/transaction – typical for most merchants).
- We didn’t think clients would want to use it anyway – most of our clients are business & Government.
We decided to give it a go, as an experiment some time ago, and found some interesting results:
- So long as you have a Credit card option too, clients will not be confused by Paypal. Clients who use Paypal regularly prefer it.
- An increase in sales negated the fee component.
- All our customer types utilise Paypal.
Why we now use Paypal, how to deal to the perceived issues
We now use Paypal not only for on our own online stores, but for accepting payments for other parts of our business too. What we found interesting was very quickly 10-15% of our sales from our online store shifted to Paypal once we implemented it. We found that there was no rule for the type of customer who used it, or the amount they would pay through it. Clients didn’t pay a maximum amount, and it was used perhaps even more by non individuals, than by other client types. Paypal can be a pain if you don’t have it as the customer and that’s the only option for making a credit card payment. But people who use it all the time find it very convenient (we use it everywhere and it is a big time saver for making online purchases, and means you don’t have to enter your credit card). Paypal can be a great way to start accepting credit card payment, without having to pay for additional merchant fees. On your first 50 transactions per month for a small store, Paypal may be in fact be comparable in terms of overall cost. Why not consider your overall costs, including merchant fees, and factor that into your pricing.
Why you should be using Paypal on your online store … and in business generally
If you’re not already accepting Paypal on your online store, we think you’re missing out. It can add an existing revenue stream, or make you more appealing compared to other stores that don’t have it. Market awareness or penetration of Paypal is relatively low in Australia – much lower than it really is. We think within 12-18 months your clients will be asking why you don’t have Paypal, and for online stores it will be just as in demand as credit card facilities.
