More and more retailers are adding PayPal to their list of payment options as one in three UK online shoppers say it’s their preferred payment method…
PayPal is on a bit of a roll. Its share of consumer internet payments is up 5% over the last year, from 16% to 21%, 30% of UK online shoppers now say they prefer to use PayPal over any other form of payment online and over 120,000 retailers in Europe now accept PayPal.
“Major UK brands which have launched with PayPal in recent months include William Hill, CDWow, Victor Chandler and all the Arcadia brands; Burton, Dorothy Perkins, Evans, Miss Selfridge, Topman, Topshop and Wallis,” says Mark Hodson, marketing director at PayPal UK.
“Online shoppers are still concerned about identity theft, and are rightly wary of typing their card details on ecommerce sites,” Hodson explains. “PayPal offers the peace of mind that their financial details are not shared.”
Speed is also a factor, Hodson believes. “Consumers are demanding faster online shopping experiences, which are both safe and secure. The convenience of being able to checkout in just a few clicks without having to type in payment details or address are what make PayPal such a popular way to pay.”
A new PayPal debit card could also drive acceptance forward. The card is a joint venture with RBS and carries a Visa logo. No credit checks are carried out and consumers simply pay a £4.95 fee to get a card. They can then top up the card direct from their PayPal account or at any of the 19,800 PayPoint outlets around the country and spend the funds loaded onto the card online, on the high street or even abroad at any Visa merchant.
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Almost half the retailers who took part in a survey conducted by E-consultancy and DoubleClick say the proportion of their sales from comparison shopping engines increased this year and, overall, one in ten online sales now originates from these services.
Some 43% of retailers surveyed for a new E-consultancy/DoubleClick report say the proportion of online sales coming through comparison shopping engines (CSEs) has increased in the last 12 months. And, on average, retailers report 10% of their online sales are now coming through comparison shopping engines.
“The period of austerity we have entered is driving more people to comparison engines so it makes sense for most retailers to make sure they are visible on these sites,” says Linus Gregoriadis, E-consultancy’s head of research.
But, despite the success that many merchants have with comparison engines, significant numbers of respondents still report problems with managing the process in terms of handling data feeds and understanding the channel’s value, the survey found.
Agency survey respondents reported that the biggest problems for their clients using this channel were difficulty keeping feeds updated (37%) and difficulty tracking and understanding return on investment (35%).
“Interestingly, the survey highlights that despite the popularity and evidence of the clear contribution of CSEs to online sales, retailers and their agencies are still wrestling with an array of challenges — one of which is tracking alongside other channels,” commented Sophie Chesters of DoubleClick.
Key findings include:
Google Shopping/Google Base is the most commonly used (by retailers) comparison engine, utilised by 63% of retailers. Half of online retailers surveyed said that they used Kelkoo while PriceRunner, Shopping.com, and Shopzilla are each used by 30% of internet retailers.
While many retailers are increasing their investment in this channel, just over a quarter (28%) say there has been a decrease in the level of sales they are getting from comparison engines.
Some 21% of retailers surveyed are not currently using any comparison engines to advertise their products and services, while a further 16% use just one comparison site.
The majority of companies (59%) surveyed are not using online marketplaces such as Amazon or eBay to sell their products.
Social or “next-generation” shopping sites have not yet penetrated the consciousness of the majority of online retailers. Merchants are most likely to be aware of Kaboodle, Jellyfish and Twenga.
Retailers rate Google Shopping/Base and Shopping.com as the best comparison shopping engines for volume, with 38% saying that Google is “good” and 35% saying that Shopping.com is “good”. Kelkoo and PriceRunner are both rated as being good for volume by 28% of merchants.
Google Shopping/Base was also rated by merchants as the best CSE for quality of traffic and for ease of use.
Just under a third of companies (29%) surveyed said that they used their own tracking tools to track activity in the CSE channel, compared to around a quarter (24%) who use third-party tools and technology and 11% who use CSE tracking. A third (32%) use a combination of these methods.
The majority of retailers surveyed manage their CSE feeds in-house, whilst only 13% use specialist feed optimisation companies. The same percentage (13%) use agencies for this purpose.
