Bjorn Lomborg of the Copenhagen Consensus Center makes the case in his book Best Things First that in order to advance economic growth, the world should concentrate on resolving a dozen issues that have a favorable constellation of characteristics: we know how to solve them, the costs of doing so are low, and the impact of doing so is enormous.
In other words, we should start by resolving the most significant simple difficulties.
That method of thinking is directly relevant to a company's expansion. The goal of Stripe is to boost the internet's GDP, which will, in our opinion, benefit the entire world. Although that objective may sound broad, the most harmful obstacles to online commerce are surprising every day. For instance, even minor quantities of friction cause highly driven shoppers to abandon their purchases right before checking out.
Even after the evolution of online shopping for many years, checkout failures are still shockingly prevalent. According to recent Stripe study, 99% of the top e-commerce sites commit five or more simple checkout mistakes, such as failing to autofill addresses, disabling users from saving their payment information for later use, or failing to accept the preferred payment methods.
Each problem is small on its own, but when they all exist together, revenue is killed off one by one. And companies would take care of these issues on their own, but a fantastic checkout is a shifting goal that needs constant upgrading as consumer preferences shift and technology advances. It's more than most organizations can handle, and the difficulty is amplified for big, sophisticated enterprises because the complexity of their checkouts multiplies with the size of their operation.
As a result, despite the enormous potential rewards from eliminating them, visible inefficiencies continue to exist almost everywhere. According to our own data, users who switched from the Card Element, an older Stripe interface, to our enhanced checkout solutions saw a 10.5% boost in income.
We've committed thousands of engineers and data scientists to building a great checkout experience because it offers so many opportunities for our users and the internet economy as a whole. This week, we're announcing several new features that represent some of our most exciting advancements yet in that direction. These include support for over 100 payment options, which ensures that customers practically everywhere in the world may make their payments in the manner of their choice, and an A/B testing tool that enables companies to precisely pinpoint the optimum payment methods for their checkout.
These features—along with many others—are included in a collection of goods we call the optimized checkout suite. It has the largest levers we notice affecting checkout, and they are designed to be pulled nearly automatically. In a nutshell, it's all the best practices and clever checkout optimizations you've been meaning to include, bundled up in a convenient package.
Principles through products
It turns out that every efficient checkout flow share four principles, independent of the business type or size of the company. They serve as conversion's catalysts and serve as the foundation for the entire optimized checkout suite:
1. Briefness
The checkout process ought to be simple, quick, and easy to follow. Customers are aware of this – 60% said they would leave a website if it took more than two minutes to complete a purchase.
Fortunately, there are many things you can do to speed up the purchasing process. To avoid a sale collapsing at the end due to hesitation, the checkout should display pertinent information regarding particulars like shipping fees early in the process and autofill personal and payment details. To make it easier for customers to make purchases, you may also offer one-click or express checkout alternatives using integrated buttons. For instance, OpenAI leveraged Link, a Stripe-built accelerated checkout experience, to save and automatically fill in payment and shipping information, speeding up the process by 40% on average.
2. Individualization
Customers prefer to use the payment option that they find most convenient while making transactions. According to our research, 93% of customers think it's critically to offer local payment options. At the same time, you don't want to paralyze customers by offering a lengthy number of payment alternatives.
Danish kitchenware maker Bodum used Stripe's dynamic ordering to uncover the most pertinent payment options for each consumer as it expanded its internet business to 23 countries and introduced 18+ payment alternatives. For instance, when the business expanded to the Netherlands, 83% of transactions utilized regional payment options like iDEAL and Bancontact that are less common in other regions. Bodum accommodated regional tastes without overburdening buyers with unimportant options.
3. Speed of response
As a percentage of overall ecommerce sales, mobile orders are growing quickly. Given that conversion rates are much lower on mobile devices, this transition raises additional challenges. For smartphones, a responsive checkout instantly adjusts to the most popular device screen sizes. Additionally, it takes digital wallets like Apple Pay, Google Pay, and PayPal to make ordering on mobile devices simpler.
4. Flexibility
Complex revenue models, such as subscriptions, should be supported by the underlying infrastructure. This calls for a complex payment system that can reliably maintain payment, billing, and shipping information while charging accurate amounts at predetermined times. Other significant capabilities include automating multiple payment attempts to recover lost revenue, planning letters for declined payments, and using built-in card updates.
The optimized checkout suite, which consists of the following, puts these ideas into practice:
UIs for payments that increase conversion. You can select from a variety of adaptable, prebuilt payment user interfaces using the optimized checkout suite. Through Stripe Elements, you can improve your checkout by adding modular, resizable UI elements, you can use Checkout to open a prebuilt payment page, or you can use Payment Links to instantly accept payments online without writing any code. All our prebuilt UIs feature navigation that is optimized for mobile devices, autofill, error warnings, input masking, streamlined compliance, support for mobile SDK, and more.
Access more than 100 international payment options so that your consumers can pay however they wish. Additionally, you may activate more than 40 payment options directly from the Stripe Dashboard, and the machine learning algorithm of Stripe will dynamically present the most pertinent ones to you. With the help of our new A/B testing tool, you can delegate the challenging aspects of experimentation to Stripe while still understanding the effect of different payment methods on revenue.
Rapid checkout using Link. According to research, companies who use Link experience a significant increase in conversion. Italic, an online store for luxury products, discovered that Link's quick checkout raised conversion rates by 34% in the first month.
Businesses have the option to enable payment methods on their own and restrict access to payment methods thanks to platform-level controls, which let software platforms with integrated payments distribute payment methods in bulk and access granular controls to configure payment methods for all businesses.
Without spending the time and developer resources necessary to construct, manage, and optimize a best-in-class checkout from scratch, these tools and features provide you more control over the consumer experience—and the corresponding increase in conversion rates.
Using checkout as a high-leverage strategy
The act of collecting payment for a transaction has long been seen through a very limited lens—as the simple act of entering credit card information and pressing "buy." This is true whether it's a real cash register or an online checkout form.
We now realize that the payment process needs to be a much bigger component of the complete checkout process. There may not be any phase of the client's journey that has more value waiting to be realized. We believe that increasing checkout conversion rates is one of the most significant revenue issues that we already know how to address, which is why we are working so hard to achieve precisely that.