For small online retailers the most difficult fear to overcome with new buyers is trust and a new study suggests the PayPal brand name may help.
A lot of consumer concerns stem from a lack of trust when buying online and this is particularly harmful to small businesses.
The study by Ipsos found that Consumer are more willing to buy in newer or unfamiliar situations if the business accepts PayPal. Typical unfamiliar situations include:
- cross-border (international) sales
- mobile transactions
- purchasing unfamiliar brands
- buying higher ticket items
The study highlights a few important key metrics:
- Consumers are 54% more willing to buy when a business accepts PayPal, especially in unfamiliar situations.
- 59% of PayPal users have abandoned a transaction because PayPal wasn’t there.
- 25% of people have abandoned a transaction because their preferred payments provider wasn’t there.
- Businesses can establish trust with consumers by offering preferred payment methods; 44% are more likely to trust and shop with businesses with a preferred payment provider and good payments process.
While there has been a dramatic rise in digital commerce, several larger players such as Amazon and Walmart have consumer trust that many small businesses lack.
And there’s still a major gap between the percentage of consumers who shop online and the percentage of consumers who actually buy from the merchants where they shopped.
PayPal Brand Brings Trust
When looking at the findings, it is clear that the PayPal brand brings trust to a transaction.
The study also found that when comparing credit cards, debit cards and all other relevant digital wallets, PayPal is the most preferred payment method by consumers.
And one cannot overlook that 59% of people who use PayPal said they have abandoned a transaction because PayPal wasn’t there. That is a potential huge loss for those businesses that do not accept PayPal.
With PayPal approaching 250 million users, this represents a large group of buyers that rely on PayPal to provide safe and secure transactions for their online purchases.
And as PayPal continues to expand its services internationally, that will only help small business online retailers gain more customers from around the globe.
PayPal may be a premium transaction service as its fees are more than standard credit and debit card transaction fees. But the trust factor PayPal appears to bring to small businesses may be worth the additional cost.
For those online merchants still on the fence about PayPal, this new study makes a compelling argument that PayPal should be a consideration as a payment solution.
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