New research reveals payment optimization can increase revenue by 30%
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Insights
The findings from Nuvei's whitepaper highlight the significant impact that payment optimization can have on eCommerce revenue. The data indicating that 30-40% of authenticated transactions for eCommerce merchants are declined suggests a substantial area of opportunity for businesses to improve their transaction approval rates. Furthermore, the 70% cart abandonment rate post-checkout entry points to the critical need for a streamlined payment process.
From a market research perspective, understanding consumer behavior during the checkout process is essential. The high decline and cart abandonment rates could be symptomatic of a larger issue within the payment ecosystem, such as the need for more robust fraud detection systems that do not compromise the user experience or the integration of more payment options to cater to a diverse customer base. These insights could guide strategic decisions to reduce friction and improve conversion rates, directly influencing top-line growth.
From a financial standpoint, the potential to drive up to 30% revenue gains through incremental payment optimization is a compelling proposition for investors and stakeholders. For Nuvei and similar fintech companies, the ability to demonstrate a direct correlation between their services and increased revenue for merchants can be a strong selling point. It could influence the company's valuation, as investors often look for growth levers within a company's offering.
However, it's important to scrutinize the underlying assumptions of these revenue gains. Are they sustainable in the long term and what is the cost associated with implementing these payment optimizations? Investors would benefit from a deeper analysis of return on investment (ROI) for such optimizations and how they compare to industry benchmarks.
In the context of eCommerce, payment optimization is a critical element that can either enhance or hinder the customer experience. The whitepaper's emphasis on strategic payment optimization aligns with industry trends that prioritize customer experience as a competitive differentiator. The research suggests that by intelligently applying functionality and features at various transaction stages, merchants can achieve higher approval rates and, consequently, revenue growth.
It's important to note that while the focus is on technological enhancements, the human aspect of understanding customer payment preferences and behaviors should not be overlooked. E-commerce platforms need to balance the adoption of advanced payment features with ease of use to avoid overwhelming the customer. Additionally, the integration of payment optimization strategies should be done with a view of the global market, considering the varied payment methods preferred in different regions.
Nuvei whitepaper surveyed 300 international enterprise-level businesses to discover how incremental payment wins drive revenue gains
To compile the whitepaper data, Nuvei commissioned research to survey more than 300 global merchants and interviewed payments leaders from worldwide brands. Key takeaways from the research include:
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-40% of authenticated transactions for eCommerce merchants are declined - 20
-40% of those declines result in a fully lost transaction 70% of overall cart abandonment happens after the customer enters the checkout flow
The extensive research offers a wealth of insights, practical strategies, case studies, and convenient scorecards for businesses seeking to harness the full power of their payments to combat these issues and optimize their revenue growth.
Philip Fayer, Nuvei Chair and CEO, commented on the announcement: "Payment optimization is key to helping our customers accelerate their revenue. Our latest research highlights the reasons it should be at the core of any payment strategy. At Nuvei, we're not just enhancing payment processing; we're revolutionizing it. By understanding the nuances of payments optimization, we intelligently apply functionality and features at every stage; pre-transaction, during transaction routing, and post-transaction to achieve the highest approval rates possible."
Accelerating revenue growth: How incremental payment optimization can drive up to
About Nuvei
Nuvei (Nasdaq: NVEI) (TSX: NVEI) is the Canadian fintech company accelerating the business of clients around the world. Nuvei's modular, flexible and scalable technology allows leading companies to accept next-gen payments, offer all payout options and benefit from card issuing, banking, risk and fraud management services. Connecting businesses to their customers in more than 200 markets, with local acquiring in 50 markets, 150 currencies and 680 alternative payment methods, Nuvei provides the technology and insights for customers and partners to succeed locally and globally with one integration.
For more information, visit www.nuvei.com
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FAQ
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