Tips for coping with credit card rate increases

One of the consequences of the rise of the ecommerce market has been a shift in payment methods. While credit cards still rule the roost for brick-and-mortar stores, alternative methods of payment have taken off with the digital marketplace. According to a study conducted by yStats, credit card payments accounted for 40 percent of online transactions made in the Untied States in 2011.

Although PayPal has become the most widely used form of payment for online shoppers, ecommerce merchants must still be open to receiving credit cards. One of the costs of doing business is paying those processing fees. Some businesses have witnessed their rates go up recently, prompting Practical eCommerce contributor Phil Hinke to speculate that more banks could follow suit.

In light of these potential rate increases, Hinke offered several methods by which ecommerce businesses could mitigate the damage. The most important factor to consider is a merchant's ability to renegotiate his or her card processing rates. Those figures are not set in stone, and businesses may find that by contacting their bank, they may be able to bring their rates down. Hinke stressed the importance of staying calm and keeping emotions in check, no matter how egregious a rate increase may seem.

Staying apprised of pricing and contract conditions can help ecommerce merchants reach a satisfactory resolution in the event of a processing rate increase. For instance, knowing the conditions of a company's out clause could provide it with some leverage when negotiating lower rates. If a bank refuses to budge on its processing fees, an informed merchant could simply cancel their contract and take his or her business to a competitor with more lenient rates. Hinke cautioned that companies which consider this route should be absolutely certain that they have thoroughly researched available options to receive the best processing value. By taking the time to calmly assess their situation and options, ecommerce merchants can weather processing fee hikes.

Getting the most out of marketing resources

As the ecommerce market continues to expand and reach a wider base of consumers, businesses have been investing more resources into their marketing efforts. According to a study conducted by eMarketer, worldwide spending on digital advertising alone surpassed $100 billion in 2012 and is predicted to increase by another 15.1 percent through the end of this year. With more resources being sunk into marketing efforts, it is imperative that ecommerce companies optimize their efforts to increase both the reach and effectiveness of their campaigns.

Although businesses are spending more on digital advertising, this may not be the best use of their marketing budget. A recent study conducted by Forrester found that only 20 percent of United States consumers trusted the messages conveyed by digital advertising, E-Commerce Times reported. Before ecommerce businesses dump their digital ad campaigns though, they should consider that quality matters a great deal in regards to public perception of advertising content. Crafting a focused and engaging advertising campaign can still be an effective method of reaching potential customers.

“Some ads disarm consumers with humor and other techniques, or emotion, and are embraced or go viral,” Greg Sterling, principal analyst at Sterling Market Intelligence, told the news outlet.

Businesses could also put more focus on cultivating a forum for customers to review their products. The study found that 46 percent of consumers trust online reviews written by their peers. By encouraging customers to review their products and services, ecommerce companies can spread the word on their quality wares.

Many consumers, however, still trust good word of mouth. Seventy percent of respondents said they valued brand or product recommendations from their friends and family members. Using social media tools, ecommerce businesses can foster communication with consumers and increase their visibility on sites such as Facebook. When potential customers see that friends or relatives are supporting a business on a social media network, they will be more likely to use its services.

Optimizing daily ecommerce operations

With the increasing sophistication of ecommerce software, businesses have a wide variety of automated resources at their fingertips. ERP and CRM software can assist companies in streamlining and consolidating their supply chain, sales and marketing functions. The only real downside to such programs is the possibility that an ecommerce business owner could become complacent. Even with the automated processes built into new software developments, there is still a need for some hands-on governance by ownership. In order to prevent operations from falling through the cracks, there are several key functions that ecommerce businesses should be monitoring every day.

Practical Ecommerce recently laid out the basic day-to-day operations that directly influence the success of an ecommerce business. A major component of operations that ownership should stay apprised of is the integration of new product lines. Even the most successful company needs to focus on future developments. The top sellers of today can quickly fall out of favor with consumers. A business should always be optimizing its efforts to find new and profitable products to offer customers.

With new and current product lines, it is essential that companies maximize their marketing and promotion effectiveness. According to a recent study conducted by Gartner, marketing spending in the United States will increase by 9 percent in 2013. To ensure that those resources are being well spent, businesses need to continually monitor the quality of their marketing output. Daily protocols should include making sure that product descriptions, images and supplemental material is clean and effective. Promotional materials such as emails, coupons and online newsletters need to be timely and engaging. Even the smallest mistake could deter a prospective client or customer.

Utilities can improve collections payments with statistical analysis

Utility companies are some of the most vulnerable enterprises in the United States when it comes to debt. A recent assessment of the risk incurred by utilities found that, because of their increased dealings with consumers who are more likely to default on payments, these companies may face more debt-recovery issues. Unlike many businesses, some utility companies are faced with an obligation to extend service to anyone who requests it, regardless of their credit risk. In addition, individuals who fail to pay utility bills may be more likely to face collections from a variety of creditors, creating stiff competition for utilities attempting to recoup their losses.

Further exasperating this issue is the increasing cost of doing business. Global consulting firm Strategy& reported that capital expenditure requirements for the country’s utilities are expected to grow to more than $100 billion annually through 2020. The need to improve aging infrastructure represents a large portion of these costs.

With rising costs, an ever-growing customer base and increasing debt, utility companies need to streamline their collections processes as much as any enterprise. According to Intelligent Utility, more businesses in this sector are implementing statistical analysis tools to facilitate these efforts. Statistical payment behavior modeling can help utility companies predict a number of factors regarding current and potential customers, including the likelihood of nonpayment, resorting to shutting off service or a payment transfer failing to be completed. With these resources, utility companies can determine which clients represent better investments.

Businesses can also use the statistical payment behavior modeling to enhance their collections strategy and reduce their costs. By identifying payment issues before they become serious, utility companies can take the necessary steps to mitigate their risk. In addition, companies can implement stricter collections policies up front for customers who have been designated as payment risks. Using comprehensive credit collections software, utilities can reduce their risk of customer delinquency.

Improving an ecommerce site with simplicity

For any business using quality ecommerce software as the foundation for a digital storefront, there are a number of tools at its disposal to increase its customer appeal. One of the easiest methods to draw in new clients is by having a clean and easy-to-use interface. Conversely, a quick way to drive away potential customers is by having a clunky and confusing website. According to a study conducted by economics researchers at Indonesia's Satya Wacana Christian University, 50 percent of all potential online sales are lost because shoppers have difficulty finding the products they want. Improving an ecommerce business' website interface is a quick and easy way to make a good first impression with prospective clients.

Although it is good practice to operate a business with the goal of standing out from one's competition, website interface is not the best area to implement this practice. The study found that internet users expected 77 percent of the more basic website design elements to behave in a specific manner. As ubiquitous as the internet has become, it can be easy to take for granted how unwieldy new developments can seem to users. In order to appeal to the broadest audience, taking a simple and time-tested approach to web design is ideal.

Internet marketing expert Roman Viliavin, in a recent Business 2 Community article, weighed in on what practices should be used when crafting an ecommerce website. He stressed the importance of simple, user-friendly features. For instance, businesses may want to consider keeping the search bar within the visitor's line of sight at all times. The less a customer needs to look for basic tools like a search bar, the less likely he or she will be to abandon the site. Viliavin also suggested keeping category and subcategory pages free of clutter. By clearing out extraneous information, businesses can both provide customers with an easily navigable experience and ensure that they are only being presented with the most pertinent information.

Getting the most out of email marketing campaigns

As most ecommerce businesses can attest, email marketing is a vital component of any effort to expand operations. Engaging prospective and current clientele is essential to converting and retaining valued customers. Email marketing can be an effective tool to demonstrate the worth of individual clients and cultivate communication. With a focused strategy in place, online merchants can significantly increase their customer pool. According to statistics compiled by eMarketer, 67 percent of marketers worldwide cited email as the most successful digital marketing platform. Furthermore, open and click-through rates increased between 2010 and 2012 for both house and prospect lists. This topic has been touched upon before, but there are always opportunities present for ecommerce businesses to further enhance their email marketing efforts.

There are numerous ways in which ecommerce businesses can craft more effective email marketing campaigns. According to Practical eCommerce, vendors should carefully consider every aspect of an email's content. For instance, some marketers will be satisfied with a subject line that simply gets the consumer to open the email. A far more effective subject line, however, will jumpstart the customer conversion process. To optimize efforts, ecommerce businesses should avoid vague terminology. Delivering a specific offer and call to action can lead to potential customers already having a specific purchase in mind when they open the email and ultimately lead to higher conversion rates.

The source also recommended that online merchants pay close attention to the "From" line in their marketing emails. The recipient's name can oftentimes appear larger than the subject line, drawing the reader's attention. Ecommerce businesses' can test out variations between a company name or individual person to determine which is most effective. In addition, vendors should ensure that the first line of the email compliments the subject line, as it is often visible from an email client inbox. These strategies are two simple methods that ecommerce merchants can use to enhance their email marketing campaigns.

Optimizing ecommerce sites for mobile engagement

For any ecommerce merchant looking to expand his or her business in the coming years, accounting for mobile devices is essential since more people are using smartphones and tablets than ever before. A recent study conducted by Javelin Strategy & Research concluded that tablet adoption rates alone are expected to increase 40 percent by 2016, reported ZDNet. It is not just the growing number of mobile device users that ecommerce businesses should be paying attention to, but their greater customer value. According to a report released by nonprofit group IAB, consumers who used their smartphones were 22 percent more likely to make an unplanned purchase when shopping online. In order to take advantage of these trends, online merchants need to ensure that their digital storefronts are compatible with mobile devices.

E-Commerce Times recently proposed several methods by which online businesses could enhance their mobile compatibility. The key to optimizing this task is by stressing the end user experience. For instance, the news source suggested weighing the value of third-party plug-ins and applications present on ecommerce software that may significantly degrade the site's performance. If the presence of overly intensive applications are weighing down a site's functionality and making navigation with a mobile device difficult, an ecommerce business may want to consider scaling back those processes.

Optimizing an ecommerce website's design for mobile device browsing is essential for appealing to this growing demographic. The difficulty with creating a website around mobile hardware is the wide range of devices out there. Tablets allow for a great visual field than smaller smartphones. Making a strong push to appeal to tablet owners may discourage smartphone users and vice versa. Regardless of the specific platform, the mobile trend has not shown any sign of waning, so ecommerce merchants should take steps to appeal to this burgeoning user base.

Unpaid bills accumulate for Virginia town

The issue of debt has become a topic of major discussion in the United States as of late. From the local to the federal level, communities and government agencies have struggled to balance budgets. According to the Congressional Budget Office, the federal government will report a deficit of $845 billion in 2013. The functionality of the United States government will not be greatly affected by these numbers, but many smaller communities do not have that luxury. The city of Martinsville, Virginia, for instance, has made budget cuts to many of its departments, programs and staff over the last few years. Reductions in law enforcement and fire department staff were made because of budget constraints, according to a government report. The Virginia Local Government Management Association found that 76 positions had been cut over the past two years, with upwards of 30 or more to follow through the end of the financial year.

One area in which the city could increase its revenue stream is by collecting overdue debts. The Martinsville Bulletin reported that the city had yet to collect on approximately $450,000 and $210,000 in utility bills and business license fees, respectively. According to city officials, the number of unpaid business license fees have been on the rise, possibly due to recent procedural changes that have focused less on taking delinquent account holders to court.

For organizations that struggle with collecting unpaid debts, employing credit collections software may be a viable solution. Government officials and company executives alike can track debt collection procedures and ensure that payments are being made on a timely basis. Sophisticated software can provide businesses and organizations with the resources to monitor every phase of collection management, from phone and email correspondences to invoicing. By utilizing these tools, businesses and agencies can greatly enhance their debt collection efforts.

Enhancing ecommerce efforts with big data

Businesses that have implemented ecommerce software have a number of resources at their disposal to facilitate their operational processes. CRM and ERP software tools can consolidate resources, streamline operations and enhance communications. With the advent of big data analytics, online vendors have an additional tool with which to enhance the functionality of their businesses. Data analytic programs can gather and process huge volumes of data and extract meaningful insight regarding market trends and consumer behavior patterns. With that information in hand, businesses can gain a better understanding of the underlying motivations for fluctuations in the ecommerce market and position themselves to take advantage of emerging trends.

Practical eCommerce recently presented a few areas in which big data analytics can enhance operations. The potential benefit that will interest companies is increased sales. Big data tools can analyze the various components that lead to successful sales transactions and suggest changes that can facilitate greater customer conversion rates. In addition, businesses can market their wares better. Data analytics software can be used to assess customers' purchase histories and suggest additional products based on that activity.

Big data software is also able to enhance inventory management by identifying products and even certain model variations that are not selling. Similarly, analytics tools can determine which products are moving units, allowing businesses to make necessary changes to their inventory. With these resources, online merchants can increase their efficiency and more effectively manage their expenses.

The big data movement has been gaining steam over the past few years and does not appear to be abating any time soon. A recent Gartner study forecasted that 20 percent of Global 1,000 organizations will have dedicated data analytics programs in place by 2015. At the outset of the data analytic trend, only large corporations could afford the huge data centers needed to gather and process information. However, with the proliferation of big data solutions providers, businesses both large and small can take advantage of the technology. With ecommerce software, digital merchants already have a pool of data to draw from and produce actionable insight.

The meteoric rise of ecommerce

The ecommerce market has been a financial juggernaut of late. Enticed by lower prices and greater convenience, consumers continue to flock to online outlets. Brick and mortar stores have taken great pains to lure customers back to their shops, including implementing data analytic models to change in-store prices to match their online competitors. Still, the growth of ecommerce has continued unabated. The world is becoming increasingly digitized, and online businesses are quickly becoming the standard for commerce.

Forrester recently released a study tracking the growth of the ecommerce market. According to the research firm's analysis, ecommerce will continue to expand and make up ground on brick and mortar stores for the foreseeable future. In the coming year, ecommerce sales in the United States will rise 13 percent to reach $262 billion. Total online sales will hit $370 billion by 2017. The firm forecasts that ecommerce's growth will outpace that of traditional brick and mortar stores over that period. By the end of 2017, online revenue will account for 10 percent of all retail sales in the United States.

One of the major factors driving ecommerce growth is the increasing adoption of mobile devices by consumers. According to a recent Cisco study, the number of smartphones and tablets will exceed the number of people on earth by the end of this year. With more people having access to the internet at all times, consumers are spending more time browsing online stores and comparing prices.

"The increased penetration of web-enabled mobile devices boosts the amount of time consumers spend online," said Forrester analyst Sucharita Mulpuru, according to Reuters.

With the spread of mobile devices and more expansive internet access, the economic landscape is shifting. Consumers are increasingly looking to digital storefronts for their purchasing needs. For businesses that want to thrive in this new world, implementing ecommerce software is a necessary step.

Rules for an effective landing page

Once an ecommerce business is operational, the owner will begin looking to invest in advertising and marketing campaigns. While many will begin with email and social media outlets to meet their needs, others will look to online advertising such as sponsored search engine links. A study produced by eMarketer predicted that digital ad spending will reach $118.4 billion in 2013. This is an effective method to appeal to new customers because ecommerce businesses are allowing the consumers' own wants to direct them to a storefront. However, some companies may be content to simply link the ad to their homepage, but this is an ineffective way to coax website visitors into making a purchase. To maximize their customer conversion rates, companies should be sure to create effective landing page.

Practical eCommerce recommended that when crafting a landing page, ecommerce vendors should strive for product relevancy. For instance, if a customer searches for a specific brand, clicks on an advertisement promoting said brand but finds they have been brought to a general product page, they will most likely leave that website without investigating further. The beauty of search engine advertising is that customers are telling vendors exactly what they want. If a business cannot take them straight to their products, consumers will go to a company that can.

Another factor to consider is how products are listed on a landing page. Presenting the most expensive items available could potentially scare off customers before they have a chance to browse cheaper wares. On the other hand, leading off with the least expensive products could send the message that a vendor only deals in low quality products. Highlighting best selling items is an effective strategy, as businesses can draw in customers by presenting popular products first. By ensuring that their landing page content is relevant and engaging, ecommerce businesses can enhance their customer conversion rates.

Essential ecommerce software features

As the digital marketplace expands and becomes more sophisticated, vendors everywhere are demanding more from their ecommerce software. The days when a basic interface and online shopping cart would suffice are long gone. Today, ecommerce businesses require a wide range of functions in order to meet their needs, especially when it comes to engaging customers. Online methods of communicating with potential and current clients have become far more sophisticated in recent years. For online businesses looking to optimize their customer engagement efforts, their ecommerce software should be doing a lot of the heavy lifting. There are several functions which are essential to maintaining a focused digital marketing campaign.

Practical eCommerce contributor Armando Roggio recently identified several online store features that will facilitate business growth in the coming years. One of the main focuses of any company should be encouraging site traffic and enhancing customer conversion rates. There are several methods to pursue these endeavors. First, businesses should ensure their software allows for video integration. The importance of this functionality has been argued before, but it bears repeating: Video content greatly enhances branding efforts. Businesses can promote products, provide valuable instructional content and showcase their thought leadership through well-crafted videos.

The ability to offer coupons or other discount promotions is also a vital component of any ecommerce software platform, Roggio said. They can be especially useful for businesses which are still struggling to gain market penetration by appealing to customers who might otherwise not consider an unknown brand. According to a survey conducted by WhaleShark Media, 74 percent of active coupon users said they would be more likely to purchase products from unknown brands if they could use a coupon.

Finally, Roggio recommended that ecommerce businesses ensure their website is compatible with mobile devices. More consumers than ever before are using their smartphones and tablets to shop online. Some forecasts have predicted tablet adoption to grow by at least 40 percent by 2016. To take advantage of this growing demographic, companies must ensure their websites can be accessed with mobile devices.

Increase branding through video

Business owners from every sector know how important building a rapport with consumers is to cultivating brand loyalty. Even behind the glow of a computer screen, ecommerce is not immune from this simple fact. Customers may operate with a degree of anonymity as they browse stores, but that does not mean that online business owners should avoid making efforts to engage them. Sophisticated ecommerce software provides a number of resources that can be leveraged to enhance the capabilities of digital stores to build brand loyalty.

Practical eCommerce recently suggested that online businesses should consider using their software's video tools to further their branding efforts. Videos provide businesses with an opportunity to display a brand image or personality. Logos and interfaces will certainly be part of the equation, but videos can be even more effective in cultivating a positive brand association. Ecommerce software should allow businesses ample resources to embed videos at various points in the shopping process.

How-to videos can be an effective resource to not only provide customers with information about a business' products, but also to establish an identity for a company's brand. An instructional video can demonstrate to consumers that a particular business is an expert in its field, values customer service and has the forethought to consider potential issues before they arise.

Even pages that many online shop owner consider as afterthoughts can be boosted by video-based branding. Having videos on contact and additional information pages such as about us or shipping information can directly engage customers and show off some personality and humor.

Businesses can even take their video branding campaigns to other sites. By posting material on social media sites, companies can showcase their particular brands to a new range of potential customers and drive more interest in their products and services.

Making ecommerce software more personalized

Adopters of ecommerce software have found that they have the framework needed to create an engaging digital storefront. Too often though, ecommerce vendors can become complacent with the interface of their website, allowing a "good enough" mentality to influence changes – or a lack thereof. With today's sophisticated ecommerce software, online businesses have the tools to craft a store that caters to the individual and provides a one-of-a-kind, personalized experience. Taking full advantage of those resources is up to the organization, however.

The goal of any ecommerce business should be to replicate the one-on-one, personalized interface of a physical store as closely as possible. It is far too easy for businesses to view customers as faceless visitors, especially given the relatively low conversion rates across the industry. However, advances in data analytics have lead to software that can be integrated into a store's website for assessing various aspects about a visitor, providing a fuller customer profile.

Practical eCommerce recently spoke to Monetate CEO David Brussin about what steps vendors can take to personalize the shopping experience. He said that depending on the location of a customer, online stores can display different browsing and search results. For instance, a customer browsing an online clothing shop from southern California may be shown different styles compared to someone in Minnesota.

Past purchases could also be used to provide customers with a more personalized experience. If a particular customer has repeatedly shopped for items of a certain style or brand, businesses could personalize marketing emails to him or her highlighting similar products. Collective Bias CEO John Andrews suggested that ecommerce vendors use social media to further personalize the shopping experience, according to BizReport. By engaging with and connecting to customers through social media sites, businesses can obtain an inside look at the various products and services that interest them. Customers can directly or indirectly communicate exactly what they want to vendors through sites like Facebook and Twitter as well.

Balancing fraud risk with sales

The growth of ecommerce software has brought innumerable benefits to businesses across the globe. Companies can now engage any person connected to the internet, creating a new limitless pool of customers to draw from. The nature of the ecommerce market, however, provides potential consumers with a large degree of anonymity. Although most site visitors are legitimate customers, there are some who will look to defraud a business. According to a report released by CyberSource, 1.26 percent of of all orders are fraudulent.

The cost of fraud in the ecommerce industry has steadily increased over the last decade. A report released by RSA found that fraudulent transactions rose by approximately 26 percent between 2010 and 2011. The topic has become a major concern for ecommerce businesses, as 85 percent of merchants expect their fraud revenue losses to either grow or remain the same in the coming year.

The threat of being taken advantage of by online criminals has lead many companies to enact order screening practices to determine the validity of a consumer. That technique, however, can impede the efficiency with which a business can process and deliver orders. Retaining a satisfied customer base while also weeding out criminals is a delicate process, but with the right approach, ecommerce businesses can optimize their efforts to provide quality service and products while protecting their interests.

One method businesses use to determine the validity of an order is by assigning an employee to manually review each one individually. This is a time consuming process and can significantly slow down operations. However, it may be that this method is being overused. Companies should look over their manual review figures and see what percentage of orders are accepted. If the vast majority of orders are checking through, then the operational slow down may outweigh the benefit of catching the rare fraudulent order. By constantly monitoring and adapting security protocols, ecommerce businesses can maximize their effectiveness while limiting operational delay.