Online payment - European preferences

whatīs your strategy

[heini]

Generally itīs never been easier for the small and medium sized business to enter foreign markets than with the internet. Translating a site and doing some basic seo work usually makes for good additional exposure and traffic. There are however some obstacles to this route of low cost globalization
One of those stumbling blocks is the question of customer support. We have in this discussion [webmasterworld.com] explored some workarounds to that one.
There is however another issue, that should be addressed before entering a foreign market. Thatīs the issue of payment.
Online business from the US and UK are fairly used to charge buyers by credit card systems. Not so in Europe. Latest research for two of the most important European markets revealed only only 15% of german online shoppers like to pay per credit card. In France 58% donīt object, while in the UK numbers are up to 72%. Germans prefer instead payment per invoice or on delivery.

What are your experiences with online shopping payment from Europe?
Did anybody try some alternative payment systems?

[caine]

heini,

i think it comes down to market place, as for the sort of products that i deal in, its money upfront, either via CC or bank transfer, and its been going on for years, so the nudity that you expose is something that is not new to the manufacturing industries.

[Rumbas]

I've just came to think about a payment system my bank uses. Not with huge succes, but the idea is good.

They've intered into partnerships with several ecommerce sites. You set up an arrangement with the bank, and then you're able to shop in these 'stores' and pay through your bank account. I guess it works like the paypal system, which by the way is somewhat difficult for Europeans to set up.

The problem in Europe would be a bank etc. covering more or all the countries.

[backus]

By the way, in the Czech Republic, if you have Internet use activated on your Mastercard, the you automatically give up your rights to insurance cover if someone steals money from your account, whether it was over the internet or not. Is it like that anywhere else???

[Ove]

Hi
I have a client that is going to use something called paybox

You pay with the mobile phone the phone is connected to a bankaccount so when you are going to pay over the net it will call in your phone and then you will have to give them a password then it goes to your bankaccount and the deal is done paybox are big in germany 260 000 users
i think they will have 3% of what the pruduct kost iam not sure

www.paybox.net
/Ove

(edited by: Ove at 4:13 pm (gmt) on Oct. 25, 2001

[heini]

Ove
thatīs a whole new strategy on online payment in Europe, and a very promising one. The main advantages I see:
- no use of credit cards, instead
- utilizing mobile phones.
Thatīs very clever, since Eurpeans are very cautious about security issues connected to exchanging credit card details over the web. Also EC Cards still outnumber credit cards here.
Mobile phones on the other hand are such a craze in Europe.

So the user in this system doesnīt need a credit card, he just needs a regular bank account plus a mobile. Online shops can from what I saw integrate the software easily. Paybox charges 3% of any transaction.

Sounds all good. Did anybody use it actually?

[Ove]

I will give you some more info about this when its ready

/Ove

[heini]

Coming back to this thread since it's still the most serious problem connected to online shopping in most European countries.

While some 2,9 bn EURO were spent [webmasterworld.com] for christmas shopping online some of the major European countries are still not anywhere close to the shopping habits of the US or even the UK.

A new survey undertaken in Germany [de.news.yahoo.com] points out most surfers do not trust online payment methods. Credit cards are not nearly as accepted by users as in the US.

To solve this problem some alternative approaches have been developed, among them the paybox system mentioned above by Ove. Paybox has even been adopted by heavyweights like Ebay. Web.de, leading german portal uses it for micro payments for their paid services.

Nevertheless those alternative (micro-) payment systems were used by a meager 7% of online shoppers. The reason given by most people was there were too much different systems in use and too little knowledge about those systems.

Trust and the lack of is the keyword here. "The Germans are more likely to change their spouse than their payment habits" concluded ECO, a german e-commerce lobby.

Basically this sums up to the recommendation of allowing for more than just credit cards when targeting the European market.

I'd still be interested in more opinions, experiences and strategies!

[TallTroll]

I think "trust" is the key element. I found an article here [strategic.gr] that shows annual and per capita spend in the B2C environment throughout Europe (measured in Euros). The UK has the highest gross spend, although the Scandinavian countries have higher per capita values (perhaps unsurprising in view of their connection rates)

The UK has the highest c/c use in Europe (1.69 cards/capita, apparently), which may explain why we seem to be the most comfortable with using the Web for e-comm. Also, here [mori.com] is an excellent link to a MORI poll from late last year, with some good information UK consumers attitudes

I think that, broadly, the poll shows that regular Web users are fairly aware of the problems and benefits of using the Web (Q's DTI6 -->) which I think leads to trust in the technology, and coupled with our relatively high c/c ownership, and hence trust in the c/c system, you get a population fairly ready to trust their details to the Web.