Compared to the European payment landscape, the U.S. seems downright boring. The European eCommerce market encompasses 14 currencies, 44 countries, and 24 languages. As you can imagine, each of those areas has a different preferred way to pay, creating a pretty interesting (and complicated) payment mix.
To illustrate the sometimes-stark contrasts in this market, take a look at these payment stats:
● In Austria, Germany, and Sweden, Payment-After-Delivery (PAD) accounts for more than 40% of their preferred payment types.
● Poland is very adverse to fraud, with preferred payment methods of online bank transfers, offline bank transfers, and Collect on Deliveries.
● In the Netherlands, a real-time alternative payment system called iDEAL is the preferred payment method – far higher than anything else. That’s why 92% of merchants there accept it.
We could go on… Most of the 44 countries have their own local payment heroes – the payment type they prefer the most. And it’s not just a matter of preferring PayPal or PAD over credit cards; in some countries, distrust of credit makes credit card payments not just incredibly unpopular, but are also more expensive when compared to some alternative payment methods.
It’s crucial for companies looking to expand into this market to not only understand these differences, but also have a plan in place to address them.
Yes, You Should Embrace Local Payment Methods
If you’re a U.S.-based eCommerce company, you might still be reeling from how many preferred payment options there are in this market. You might also be wondering whether it’s worth it to offer all these different payment types, or if you should just charge ahead with the same options you’d provide to the U.S. market.
The short answer is: Yes. It’s worth it. Not offering a customer’s preferred payment method could make or break the purchase. Across the markets, 37.5% of shoppers will abandon their cart if they can’t pay the way they want.
Considering that the annual revenue for eCommerce in Europe last year was over 600 billion dollars, that abandon rate is worth far more than the effort it takes to find a solution to offer this market their preferred options. The next question you’ll have to answer is, how are you going to embrace all those local payment heroes?
The European Payment Mix is Complicated. Find a Partner to Help You Out.
If you’re wondering just how many payment methods you’ll have to take on, we did the math for you: There are more than 75 different options in the European payment mix.
Every European country has its own preferred payment mix, along with best practices for offering those options. eCommerce companies that don’t fully understand the mix have little chance of successfully expanding into this market. But you won’t need to tackle this on your own.
The easiest way to meet this market’s demands is to invest in a partner that can help facilitate these many, many payment methods across Europe. Finding the right partner can significantly reduce friction and help you expand into new markets, no matter how complicated the payment landscape.