Operating an online marketplace is simple, in theory: A merchant builds a website, fills it with retail products and shoppers, well, shop. But when it comes to eCommerce, consumers tend to have specific needs and preferences, and merchants have competitors. And when they begin to cater to shoppers all over the world, determining the preferences of a very diverse customer base with often dramatically differing needs can be a daunting task.
Thankfully, the PYMNTS X-Border Payments Optimization Index knows which online marketplace features are most important to global consumers and has determined which eCommerce players are best meeting their demands. Top performers are often distinguished from the pack by a few small differences in marketplace functionality.
According to the Index, these are the features that separate great online marketplaces from the good ones, and good online marketplaces from the bad:
—Free Shipping Is King. Although unpleasant and expensive to implement for merchants, customers love free shipping when proceeding through online checkout. In this quarter’s X-Border Payments Optimization Index, this metric is huge, distinguishing which merchants perform the best in terms of international eCommerce preparedness from those that perform the worst: 90 percent of top-scoring merchants offer free shipping, compared with only 20 percent of bottom-scoring merchants.
The number of merchants offering free shipping fell from 58 to 53 percent this quarter (although the number has risen in the past). Merchants have to balance costs with meeting consumer needs, but this is one marketplace feature that might be worth the spend for those who can afford it.
—Small Conveniences Mean Big Gains. Small inconveniences add up during an online shopping experience. A feature like the ability for a customer to indicate that her shipping address is the same as her billing address might seem like it would make a minuscule difference to users, but the Index says that it’s ultimately another obstacle to completing the checkout process. Offering features like this lower the time it takes for a consumer to pay on a website and leads to fewer abandoned shopping carts, which means more revenue for merchants.
The Index indicates that 87 percent of surveyed merchants provide a “billing address same as shipping address” option, and that the total times to pay for both top- and bottom-performing merchants are converging.
—Operate Globally, Engage Locally. In a global marketplace, accessibility shouldn’t be underrated. A shopper in Mumbai or Ho Chi Minh City wants access to all the retail products available worldwide, and she wants that access in her own language, in her own currency and through the methods of payment she prefers. Unfortunately, the merchants surveyed by the Index have been slipping on this metric. Only 20 percent of merchants offer six or more languages, and only 30 percent of top performers offer the same. Likewise, only 23 percent of companies are offering transactions in six or more currencies.
The metric truly separating the wheat from the chaff in terms of accessibility this quarter is the number of payment types offered. The top 10 merchants accepted 10.5 different payment types, compared to the quarter’s average of 6.1.
—Customers Want To Say What They Want. When trying to determine what customers want, it’s important for a merchant to let them speak. The ability for a customer to provide feedback is a key feature for online marketplaces, as it allows merchants to understand their patrons: what they like, what they dislike, what frustrates them about the shopping experience. The Index indicates that feedback features serve to separate top-performing merchants from everyone else. While the number of merchants offering feedback options stands at 35 percent, seven of the top 10 merchants offered this feature.
With the number of global online shoppers expected to increase by 50 percent between 2013 and 2018, from 1.079 billion to 1.623 billion, merchants have to be ready to engage customers in a rapidly expanding global marketplace. For merchants, that means making products available across regions. It also means developing a marketplace equipped to serve all types of customers, worldwide.
According to the PYMNTS.com X-Border Payments Optimization Index, the above are the features that matter for the future of global eCommerce.
To see all the data collected in the Index, download the report here.
The PYMNTS.com X-Border Payments Optimization Index takes the pulse on how merchants are improving on attributes conducive to international eCommerce in countries that include Canada, China, France, Germany, Italy, Japan, Mexico, Spain and the United States.