B2C marketplaces : which payment methods boost conversions?

French e-commerce, valued at more than 112 billion euros in 2020, is on the rise and could double in volume by 2026, continuing to take market share from physical commerce. Spearheading this purchasing (r)evolution, B2C marketplaces now represent 36% of online sales! In this context, retail organizations keep looking for the next strategic shift and maintain their efforts to reinvent themselves in a mature and consolidating market.

Indeed, 60% of consumers abandon their shopping cart due to an unsatisfactory browsing experience. This represents a considerable financial loss for the e-commerce sector. Or a huge profit opportunity for those who know how to seize it! New uses, new expectations, secure payment options, adaptable payment terms...In this article, discover your guide on how to boost B2C marketplace conversions.

Understanding B2C payments: meaning and examples

What is a B2C payment?

A Business-to-Consumer (B2C) payment refers to a transaction where a business (also called a merchant) sells goods or services directly to an individual consumer. This model encompasses various industries, including retail, entertainment, and services.

What is an example of a B2C transaction?

An example of a B2C transaction is an individual booking a vacation rental through an online marketplace like Airbnb. In this scenario, the platform connects property owners with individuals seeking accommodations, facilitating a direct B2C transaction between the business (property owner) and the consumer, in a secure way.

B2C payment market trends: an evolution of B2C digital payments

Speed, choice, fluidity, mobile-first: customer habits have evolved rapidly over the last three years, and B2C marketplaces must adapt to meet the new expectations of Internet users regarding payment. Because if we are to believe Marc Lolivier, CEO of Fevad: "Covid has not triggered a revolution, but it has accelerated a trend that already existed; the pandemic has gained three to four years in the growth trajectory of online purchases, but everything remains to be done in terms of understanding uses." 

The closure of "non-essential" stores for almost two months in March 2020 forced consumers to shop online to meet their needs. The growth of e-commerce initially occurred out of necessity during this period, but it quickly turned into an adoption of new habits. Indeed, all generations participated in this growth, but it was more pronounced among 45-55-year-olds and older people, who had to catch up with the times. Marketplaces activity soared 81% in the fourth quarter of 2020, growing twice as fast as global e-commerce.

B2C marketplaces: enhancing user experience in B2C payment systems

Customer experience is a significant issue for B2C marketplaces and businesses, which have started to review their strategy during the pandemic. Consumers are looking for more authenticity and autonomy and want simple navigation, intuitive design, fast loading, and optimal security. The buying culture is constantly evolving: the adaptability of e-commerce sites conditions their profitability. It is, therefore, necessary to stay the course to offer an optimised user experience.

Speed and simplicity are differentiating elements that can be real levers of purchase... or the cause of basket abandonment. Among the Europeans who did not order their products, 42% pointed fingers at the collection or delivery methods offered. 40% criticize the complexity of the payment validation. (Nova Communication) According to a study by Storyblok, limited payment options are the main reason why 37% of consumers leave an online store. At the same time, 40% of Europeans say they are not confident about the security of the payment. 

It is, therefore, essential to offer a variety of delivery and collection methods, but above all: a fluid and secure payment experience, in particular, to reassure buyers against fraud and to meet their demand for instantaneousness. Sometimes, as Dominik Angerer, CEO and co-founder of Storyblok, notes, you have to get to the point: "Consumers focus on the basics: ease of navigation, speed of loading, simplicity of design and final payment; additional features remain an important factor in attracting customers, but it's vital to get the basics in place first." 

Key B2C payment solutions boosting marketplace conversions

Online payments have become the norm, and Internet users show that they have wholly entered this new era with high expectations regarding payment innovation and security. E-commerce players, especially B2C marketplaces, have a card to play to meet these demands for security and fluidity of the customer journey. So, what are the most effective payment methods to offer to Internet users? 

The Buy Now Pay Later

The Buy Now Pay Later (BNPL) feature has become a must-have for European B2C marketplaces, allowing buyers to make deferred payments easily. Lemonway has enhanced its payment methods to offer this new option to marketplaces, allowing them to take full advantage of BNPL without managing the technical aspects of implementation.

The BNPL offers buyers the possibility of paying in three or four installments, with payment deferred for fifteen or thirty days, without the inconvenience of classic consumer credit. This payment method is particularly popular in Europe for various products such as travel, cell phones, computers, household appliances, furniture, clothing, and sports equipment.

Payment in several installments: an essential marketing argument

Split payments (a subcategory of BNPL) are convenient for buyers to spread out their payments without taking out consumer credit. Unlike consumer credit, installment payments do not exceed 90 days and usually result in little or no cost to the consumer. In addition, paying in installments is more flexible and offers more freedom in purchasing. Consumers can use this option to deal with unexpected expenses or smooth out spending over several months for expensive purchases. This is particularly appreciated by consumers who want to maintain their purchasing power in an inflationary period.

Pay by Bank

Pay by Bank is an innovative feature that simplifies bank transfers during the payment process on a platform. Thanks to this solution proposed by Lemonway, users no longer need to leave the payment page to make their transfers. In just four simple steps, the customer can select their Bank, log in to their banking space, authorize the transaction from their banking application and verify that the transaction has been accepted.

• The advantages for merchants are multiple, notably in terms of security, control of bank details and purchase references, and the absence of chargebacks.
• Users benefit from an optimized and quick purchase path without adding the payment recipient or filling out a form.

Payment by subscription

In B2C marketplaces, subscription payments can be used as a recurring payment method for products or services offered on the platform. Consumers can subscribe to a monthly or yearly fee for services such as access to exclusive content, delivery, or purchase of products at a reduced price. A long-term conversion optimization, in short!

• The benefits to consumers are convenience, simplicity, and cost predictability.
• For marketplaces, this payment method can help build customer loyalty, increase revenue, and provide a more stable revenue stream.

Internationalization: adapted payment methods

B2C marketplaces often have to deal with buyers from different countries, making internationalization of payment methods and currencies essential to meet customers' needs. To provide a frictionless international shopping experience, you need to accept various local and international payment preferences, such as credit cards, e-wallets, and bank transfers. You can also offer payment options in local currencies to facilitate cross-border purchases and improve sales conversion.

PayPal

For B2C marketplaces, integrating new and popular payment methods such as PayPal can be a way to differentiate and maintain competitiveness in the market. In addition, PayPal increased: the following

• 17% in purchase recurrence;
• 34% purchase completion;
• 12% of the average basket.

Moreover, end-users are 6 times more likely to buy on a marketplace offering PayPal as a payment method.

Lemonway: the ideal payment partner for B2C marketplaces

Lemonway handles international payments for marketplaces in fourteen currencies as a pan-European payment service provider. Lemonway is the ideal payment partner for B2C marketplaces looking for an innovative, secure, and easy-to-integrate payment solution. With its comprehensive offering of payment methods tailored to each marketplace's needs, Lemonway enables marketplaces to offer their customers modern payment methods, such as split payments or Buy Now Pay Later, digital wallets like Apple Pay. 

By choosing Lemonway as their payment partner, B2C marketplaces can reinforce their innovative image while ensuring an optimal customer payment experience. Have a project? Do you have a question? Contact us now!