Go easy on yourself. Figuring out eCommerce can eveb confuse and frustrate the most technically literate “ninja’s”. The main reason for the complexity is that securely transmitting financial information is devilishly hard. Plus every thug on the net would love to intercept poorly secured credit card information.
Thankfully, the entire process of accepting payment, securely transmitting credit card information, getting approval, and delivering your product customers has become point-and-click easy.
Savvy software startups have stepped in and created a broad range of options for every type of business. The hardest decision you need to make is selecting which service to use.
That’s where we’ll start.
What you should look for:
I’ve compiled a list of 10 top eCommerce providers. There are dozens of options but I created my shortlist using the following criteria:
- Fees: The lower the better. Expect to pay a base fee per transaction plus a percentage of the transaction cost. It pays to examine the fine print, fees may be reasonable for small transaction but quickly balloon for large purchases.
- Access to Funds: You want quick access to your funds. Services vary from instant deposit to a intermediate account (i.e. Paypal) or direct download within 2–7 business days. Also pay attention to Fraud and Terms of Services guidelines. Some services are famous for freezing accounts for a fraud audit simply because the website owner had a good sales day!
- Recurring Payments: Regularly charging for weekly or monthly subscriptions is a great feature that is surprisingly hard for many companies to deliver. Even if you don’t need recurring payments, make sure your eCommerce Payment processor can process.
- (Relatively) Easy WordPress Integration: The best solutions have WordPress plugins that offer point-and-click installation on your blog. Lately, companies have offered access to their API for more sophisticated functionality. If that last sentence left you scratching your head then stick with plugins or well-documented cut-and-paste installation. I say “relatively” easy because installation depends on your technical skill.
- Reporting: You’ll need quick access to detailed reports to keep track of payments and billing. Look for the ability to export your transactions for accounting and tax preparation.
My eCommerce Short List
Paypal is easy to use and won’t raise questions with your customers. As the largest online payment processors, many companies follow Paypal’s lead when it comes to transaction fees.
You can sign-up for a business account and begin accepting payments within an hour. Their online payment button creator is super easy and will give you cut and paste code that you can place on blog pages, posts, and widgets.
Fees: 2.9% + $0.30 per transaction
Technically WooCommerce created by WooThemes isn’t a payment processor. WooCommerce is a shopping cart / online store option that seamlessly integrates with Paypal and other credit card processors.
WooCommerce made my list because it’s relatively easy to install on your blog and gives you great options for presenting your products. Specifically, I turn to WooCommerce when someone wants to sell more than a couple of products, wants professional and standardized product pages and/or wants to offer shipping options.
Fees: None and the plugin is free.
Clickbanks excels at offering payment solutions for information product publishers. Clickbank handles the transaction, delivers your digital product, handles refunds, and provides decent reporting.
Clickbanks is a popular choice for publishers who want to offer their product as an affiliate product and pay commissions to people who successfully sell their product.
Clickbank’s has two drawbacks:
1) They hold your funds and send you check on a 2-week rolling basis. A sale registered on October 1st will not be deposited to your account until the 15th. For most this delay is a dealbreaker.
2) Fees are triple that of other providers. Clickbank does offer to handle 100% of the transaction but these fees take a significant chunk out of each sale.
Fees: 7.5% plus $1
2 Checkout (2CO)
2CO competes with Paypal and Amazon Payments. The service works best for small to mid-sized businesses. 2CO is popular because it allows your customers to pay for their purchases using a credit card without signing-up for an account with the processor. This smart feature means less customers abandon their shopping carts or purchases because they don’t want to be a paypal account holder.
Like its competitors, 2CO makes it simple to sign-up and start accepting payments. However 2CO holds onto your funds, sending your cash once a week.
Fee: 2.9% + $0.30 cents
Stripe is the new darling of the Geekarati (yep, I just made that up). Stripe is stripped down to the bare essentials. They give you access to an API that process credits cards. There isn’t a shopping cart, no slick button generators, no money-market accounts. Just a sweet snippet of computer code.
If you know how to use APIs, like writing your own HTML pages with a text editor, and spend most of your time on Hacker News then Stripe will appeal to you. If you don’t have a clue about what I just described then go back to your seat and leave the geek stuff to the pros.
If you are willing to dig a little, you’ll find Stripe to be an extremely easy way to accept payments. Woothemes Template users can purchase an extension that easily integrates Stripe with the WooCommerce shopping cart plugin.
Fees: 2.9% + $0.30 cents. Your cash is deposited on a 7 day rolling basis.
Amazon Payments allows your customers to pay for purchases using the credit card information stored in their Amazon Account. In a way, Amazon Payments extends its dead-simple payment solution to your site.
Using Amazon Payments also gives you access to more information about your purchasers and use it to create a customized checkout experience. This feature is a potential game changer especially if you are an Amazon affiliate and can offer Amazon products (i.e. books, videos, etc.) when they checkout.
One drawback to using Amazon Payments is that it only works if a person is registered with Amazon. But, since anyone with a credit card is probably in Amazon’s system you should be good to go.
Fees: 2.9% + $0.30
Dwolla offers an interesting twist by allowing you to process micropayments, any transaction less than $10 for free. This is an attractive option for information publishers selling ebooks, mp3s, and special reports.
Dwolla does this by bypassing credit cards and processing cash transactions. Users of Dwolla connect their Dwolla account with a bank account. Once connected the user can fund their Dwolla Account. From their the user can pay for goods with cash from their Dwolla account.
Dwolla also accepts recurring payments which works great for membership subscriptions.
One more thing, Dwolla has broken with the herd and just charges $0.25.
One word of caution, it will be a difficult sell to get customers to sign-up for Dwolla to use the payment system. Dwolla seems to be great for 1-to–1 transaction but isn’t the easiest option for businesses. But they are worth considering if you want to reduce your transaction fees.
Paypal is the leader for a reason. Their system is easy and has become a standard. They protect your customers and deliver your funds immediately to your bank account.
Placing a Paypal button is a simple cut-and-paste operation and you are in business.
Combine Paypal with WooCommerce and you have a professional shopping cart and online storefront. Simple and fast and the fees are competitive.
Worth A Look
I like 2CO because it doesn’t require your users to sign-in or sign-up for an account. 2CO is also reasonably simple to install. You’ll lose some flexibility since 2CO isn’t as widely supported by shopping cart developers but lower potential shopping cart abandonment might make the switch worth it.