I’ll admit that I’ve never used an e-check or even paid cash for an online purchase. The closest I’ve come is linking PayPal to my checking account.

But today I read an Internet Retailer survey suggesting that 50% of online merchants now accept alternative payment methods such as e-checks, cash, and deferred billing. And that in some cases, these payment methods amount to 20% of their total online sales! Go figure. Equally interesting, the survey found that more and more merchants expect to offer alternative payment methods to consumers who may have – until now – been gun shy about eCommerce.

But what really surprised me was that 30% of these retailers *didn’t know* if offering alternative payments increased their sales. In this day and age of web analytics, one in three retailers simply didn’t know.

This stat is the inspiration behind today’s blog on offering alternative payment programs and how to evaluate their success.


Fortunately, with Omniture SiteCatalyst, evaluating payment program success is quite easy. When customers are going thru the checkout process, pass the name of payment method into a Commerce variable. For example, if the customer selects “Mastercard” on the billing information page, then populate your Commerce variable with “Mastercard”. If they select “e-Check” or “PayPal”, then populate the variable with “e-Check” or “PayPal”.

Do this when the customer has actually selected the payment option – not when they’ve finally ordered (on the Thank You page). This will make it much easier and more valuable to you.

Now, ensure that your Commerce variable is set to expire after the Visit. Customers are so deep in the conversion funnel by this point that you do not want the noise from multi-session conversions (of course, you could dedicate a second variable to this if you were really interested).

Great, you’re done. See how easy was that?

By doing this you’ve now opened a world of analysis possibilities. You can quickly view how much revenue each payment method contributed. But this alone shouldn’t be your decision criteria.

Create a new calculated metric that compares the revenue to orders, i.e. the average order value. Create another metric called “Payment Conversion” – this should be defined as Orders/Instances (of the Commerce variable). Now, build your report Payment Method report to show “Instances”, “Payment Conversion”, “Revenue”, and “Average Order Value”.

Comparing each payment method across these four metrics will allow you to readily understand the effectiveness of each option. From this information, you can run sequential (time-based) AB tests, or split-run AB tests (parallel flight) to isolate the full contribution of each payment method.

But don’t stop there – because you’ve populated each payment method as a Commerce variable, you can determine which products people are purchasing under each method. Is this expanding your reach? Is this increasing cross-sell opportunities? Great questions that you can now answer.

Next, do not be shy about tying this to campaigns. You may find that underperforming affiliates or keyword campaigns were just frustrated visitors looking for alternative payment methods.

Finally, check out customer lifetime value and recency of purchase. Credit card purchasers may be quicker to purchase, but which payment type is attracting the most valuable customers? How are their behaviors different? How can you exploit these differences to deliver more value? More great questions that you’re now in an excellent position to answer!

As always, if you have questions about how to improve your online success, please do not hesitate to contact us.

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