Offering subscriptions is a great way to ensure recurring revenue and create stickiness for some of your business’s biggest fans. According to UnivDatos Market Insights, almost 75% of companies selling direct to consumers will offer some sort of subscription service by 2023, and the global subscription eCommerce market is expected to hit $478.2 billion by 2025.
If you subscribe to the idea that selling subscriptions internationally could be a key to your company’s success, then you need to be sure you have the right global payment practices in place. These 5 tips for taking your subscription sales across borders can help.
1. Offer a Localized Payment Experience
Consumers are most comfortable when they see the languages, currencies and payment methods they are used to. In fact, we see up to a 12% lift in sales for our customers that present to shoppers in their local currencies.
Creating a localized experience will improve communication between you and your shoppers, helping them to know exactly what to expect from your subscription service. Also, be sure to offer popular payment methods for every location you sell into. For example, some geographies might prefer iDEAL (Netherlands) or SEPA (EU) over cards and digital wallets. Your payment processor should be able to advise you on the most popular payment methods for the areas where you plan to sell.
2. Use Local Acquiring to Improve Authorization Rates and Reduce Fees
Work with a payment processor that can help you set up local acquiring in the regions you would like to sell into. Local acquiring is when the seller’s acquiring bank and the shopper’s issuing bank are both in the same region or country. When the banks are in different regions, cross-border transactions are more likely to be declined, and they often incur considerable fees that could be avoided.
When you process payments as if they were local, leveraging quality banks and intelligent payment routing, your authorization rates will increase and you can reduce interchange and foreign exchange fees.
3. Understand Local Fraud Requirements and Compliance
Different countries have different requirements that payments must adhere to. For example, if you sell into the European Economic Area, your transactions are subject to PSD2, which includes better protections for consumers making electronic payments. As a company accepting payments, you must implement a two-factor authentication to adhere to Strong Customer Authentication.
Luckily, this is easy with 3-D Secure, which lets card issuers send one-time security codes to cardholders via email, SMS or other more convenient channels. Additionally, 3-D Secure also helps stop fraud, eliminate your liability for chargebacks related to authenticated transactions and reduce cart abandonment.
Of course, there are other compliance regulations for selling cross-border. Choose a payment processor that has the tools and knowhow so you don’t have to.
4. Set Yourself Up for Holistic Reporting
To make the most of any global business, it’s important to be able to understand how your business is doing and where the greatest opportunities lie. Having the right reporting that shows a global view of your business is essential where to invest time and effort.
Look for a payment processor that can help you keep a global pulse on your business. You should have access to a single view of your business as well as the ability to drill down in all the ways your business requires.
5. Manage Technical Debt When Supporting Global Subscriptions
We’ve already discussed quite a bit of functionality needed to help you optimize the payments for global subscriptions. You’ll also want to look for other functions like an automated Account Updater, which allows for card information updates to automatically happen so you do not have to contact each customer individually. We’ve seen our subscription clients rescue up to 10% of recurring sales by removing this friction from the process.
Often each piece of functionality and each location where you set up shop comes with different technology and a different vendor to integrate. Look for a payment processor that has the payment functionality you need built-in and free up your technology team to focus on the essential work that will move your company forward.
This post was originally published on the BlueSnap blog.