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Many hosting businesses on the internet accept only the simplest forms of payment. The simplest method of payment on the internet these days is definitely Paypal, although some businesses choose to use credit cards, cheques, Alertpay and so on.
The question is; does limiting your payment methods have a negative affect on your hosting business?
As a Business Owner myself, I can honestly say that if you are getting the traffic to your hosting business website, you could be converting at a higher rate by offering more payment methods. Spending 10-12 hours a day developing your website, services or promoting your business is certainly viable as a business owner to gain extra customers. If this sounds familiar to you, why don’t you spend a few hours setting up a few more methods of payment for your customers, and see the increase in sales!
Why would anyone not use our site because we only offer one method of payment?
It is naive to think that all consumers are comfortable using any one payment method. Personally, in the early days of paypal, I was extremely skeptical about linking my bank account to something that could be accessed with an email address and password. Friends and family of mine are just as skeptical about using their bank cards, so would prefer to use cheques; so you can soon see why it would be beneficial to your hosting business to use a range of payment methods.
In fact, the topic came up at a business breakfast meeting last week; a member had done some market research and found that 35% of consumers would go else where to purchase products or services, because of the lack of payment methods. What was even more surprising is that 25% would still use another company even if the price was slightly more expensive, as long as they had their preferred payment method available.
What benefits are there for the business owner?
Evidently, from the information provided above, most businesses will see a progressive, but long term increase in revenue from offering multiple forms of payment to their consumers. It gives companies a bold and branded look, rather than an unprofessional business that has chosen to stick to cheap and easy methods of payment, which are sometimes insecure.
Believe it or not, the payment methods you currently offer could be losing your hosting business valuable time or money. Many customers may be paying via methods that cost you money and may switch to a method that costs you less, or nothing, if you offer it. The processing times for the likes of cheques are extremely high, so offering other methods of payment here could also benefit your hosting business.
So what are the disadvantages?
Whilst there are many advantages when offering a range of payment methods, there are also disadvantages. Paypal and certain cards are subject to fees of up to 3%, while banking merchant accounts charge per transaction. If you are not currently accepting the above payment a method then that’s effectively a 3% overhead you need to apply to hosting business accounts if you choose to introduce it.
Cheques are also a major issue in many businesses. Whilst they are free to cash in, they can take a few days to clear and if they bounce, the bank usually charges the depositor, which can cost time and money!
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