As retailers eagerly—and anxiously—prepare for the holiday season, it’s more important now than ever before that they have the right tools to help them win the hearts of the modern consumer.
Local retailers are facing pressure to increase the level of convenience and speed throughout their customers’ shopping experience, from the first touch to payment. The ways in which consumers choose to pay are evolving, and businesses that don’t adapt to these trends will find themselves at a major disadvantage.
Text-to-pay can help you win big this holiday season. In this article, we’ll go over how.
Customers Want Convenient Payment Options
Before getting into text-to-pay, you need to understand the importance of convenience when it comes to payment methods. The following statistics from our 2021 State of Payments report highlight exactly what customers want from payment methods.
- 25% of customers will stop a transaction with local businesses if they can’t use their preferred payment method
- 74% of consumers indicate that their payment preference changes during COVID are going to stay
- 7 out of 10 customers don’t feel comfortable reading their card number over the phone to pay
- Customers spend about 53% more on their credit cards in person than over the phone
What Is Text-to-Pay?
Text-to-pay is when you let your customers pay via text messages (the short messaging service or SMS) on their smartphones. In most text-to-pay systems, you already have the client’s payment information on file. Then, they can simply text a keyword like “Yes” to authorize payment. This saves them the hassle of having to reenter their payment information every time.
How Text-to-Pay Will Help You Win This Holiday Season
While offering text-to-pay will benefit your business at any time of the year, this is especially true during the holiday season. That’s because offering convenient payment methods will help set you apart from other businesses, attracting consumers. Here are a few reasons offering text message payments will help you win customers.
Consumers Prefer to Text
One of the biggest reasons this payment method will help you win is that people prefer to text over other interactions—90% of consumers prefer to interact with businesses this way. The ability to let customers pay via text message is simply a way to take advantage of this strong preference.
Customers Can Choose How to Pay Over Text
It’s crucial to offer the payment methods that your customers want. But all the major options work with text message payments. You can easily have customers save credit or debit cards or even set up ACH transfers. The possibilities are limitless depending on the solution you use.
Customers Don’t Have to Log In
Yet another way that texting to pay adds convenience is the fact that customers don’t have to log into an online account to do so. As such, there’s no need to remember an extra username, password, or other account information. Nor is there any need to reset the password when they forget it.
You Improve the Customer Experience
The previous points combine to improve the customer experience. After all, if you let customers choose how they want to pay, they will have a positive experience. That improved customer experience leads to higher customer satisfaction, reviews, referrals, and repeat customers.
You Reduce Admin Costs
Paying over text messaging doesn’t just let you win in terms of the customer experience—you also win by reducing administrative costs. Text messages have a 98% open rate, so you are less likely to have to send payment reminders. You will also reduce the admin costs associated with physically typing in card information.
Text payments don’t just save your admin team from having to answer phones or type in payment details—they also allow for automation, so your team doesn’t have to send each text message separately. Instead, you can set them up to be sent automatically when certain conditions are met.
You Get Paid More Promptly
We touched on the fact that people are more likely to pay on time if you accept payments via text messaging, but this is worth listing separately. Between the high open rates of text messages and the added convenience, you will receive more payments when they are due.
As mentioned, this means your administrative team will spend less time sending payment reminders about outstanding balances. It can also help with your business’s cash flow.
Other Ways to Increase Payment Convenience
While adding the ability to pay via text messaging is important, it is just one of several ways to make paying more convenient for your customers. Here are a few other ideas to further enhance payment convenience.
Buy Now, Pay Later
One excellent way to add convenience to payments is to offer the ability to buy now and pay later. Allowing customers to make payments over time will help you attract customers who want your product or service but don’t currently have enough disposable funds to buy them. It’s all about flexibility.
Offer Multiple Payment Methods
We’ve mentioned that offering multiple payment methods is a good way to increase payment convenience. As the saying goes: You can’t please everyone… but the more methods you offer, the more likely it is that you accept your customers’ preferred methods.
Ask Your Customers
If you aren’t sure what payment methods to offer, ask your customers what they prefer—you can do this via text message, email, in-person, or by running a poll on social media. Just remember to consider the costs associated with accepting various payment methods. This will help you decide whether adding a given option makes sense financially for your small businesses.
And while you’re gathering feedback, you should also ask how you could make paying more convenient or improve the experience. Maybe they want an additional transaction confirmation. Maybe they want payment reminders via text as well as email. Or maybe they will suggest another convenient way to pay.
Don’t Require an Account to Pay
Depending on your business model, reconsider whether you want to require shoppers to create an account just to pay. This is especially important for online businesses. People don’t want to sign up for an account for a single purchase. Maybe they will make one in the future if they buy from you again, but this should be an option, not a requirement.
Additional Tips for Convenient Payments With Online Shopping
Most of the above methods apply to payments both in stores and online. But if you accept payments online, you also want to keep the following in mind, regardless of business type:
- Make the checkout design seamless
- Don’t redirect; stay on the same page
- Prioritize security and reassure shoppers about security and privacy
- Make it easy to fix mistakes
- Only ask for the information you need
- Avoid distractions
- Have a clear CTA
Learn from The Christmas Light Professionals
Now, let’s talk about a company that is doing it right this holiday season. The Christmas Light Professionals install amazing light designs, helping homes create holiday magic and light up the Christmas season. This year, they used Podium to collect down payments for holiday lights from thousands of returning customers—all before Halloween.
Being able to pre-schedule so many installations and communicate seamlessly with customers has allowed The Christmas Light Professionals to open up room for new customers during their busiest season of the year.
It may sound like a Christmas miracle, but it’s less about magic and more about having the right tools in your toolkit. With Podium, businesses can get more done without sacrificing the customer experience—so customers will keep coming back time and time again.
Start Using Text-to-pay Today
When you are ready to take advantage of text-based payment processing, Podium is here to help. We will easily integrate an SMS payment gateway into your existing solutions. You’ll notice a reduced need for payment reminders, more on-time payments, and more satisfied customers. Meanwhile, you will free up time for your company’s administrative team, letting them focus on more important tasks. Learn more about our payment solutions here.
