From grocery shopping to smart home devices, Amazon seems to be present every aspect of our lives — and payments are no exception.
Enter Amazon Pay, a payment method that allows Amazon users to pay for goods and services on your website using the payment methods already stored in their Amazon accounts.
Read on to learn more about what Amazon Pay is, how it works, and whether you should offer it as a payment method on your online store.
What is Amazon Pay?
Amazon Pay is an online payment method that uses the stored payment methods in a customer’s Amazon account to check out online without requiring additional information or data entry.
It can be used both on Amazon and across other third-party ecommerce sites. This is a convenient and secure payment option for shoppers.
How does Amazon Pay work?
Third-party ecommerce stores can add the Amazon Pay button to their checkout through the Amazon Payments SDK. If you use one of Amazon’s premier partners — Shopify, BigCommerce, Magento, or Zuora — to sell online, it takes just a few clicks to add the button to your site.
Once you add the Amazon Pay button to your checkout, here’s what happens:
- A customer clicks the Amazon Pay logo or button during checkout.
- They are redirected to an Amazon-hosted page to sign in using their Amazon login credentials.
- They return to your site to complete the checkout process.
- They choose the credit or debit card stored in their Amazon account that they’d like to use to check out.
- They receive a receipt from Amazon Pay after the payment has been completed.
Amazon’s payment SDK facilitates the transaction and forwards the money — minus the per-transaction fee — to your account. Amazon Pay charges 2.9% + $0.30 per domestic transaction. (This is standard pricing across most ecommerce payment platforms.) Amazon Pay transactions typically settle the same day.
What are the benefits of Amazon Pay?
Amazon Pay can help you increase conversions and boost customer loyalty by offering a seamless, secure payment option on your checkout.
With Amazon Pay, the buying experience is familiar and trusted — with over 310 million active customers, your target customers are almost certainly already shopping on Amazon.
This payment method helps you boost conversions in three ways: by increasing customer trust, streamlining your checkout, and offering omnichannel payments.
1. Increase customer trust
According to Baymard’s report on checkout usability, 20% of online shoppers in the US have abandoned an order due to security concerns. This means that, if your checkout isn’t perceived as secure, you could be missing out on one out of every five customers.
Adding trusted branded payment methods like Amazon Pay and PayPal can help put cautious shoppers at ease.
They don’t have to enter any sensitive credit card data on your site, and Amazon does not share password or payment information with third-party ecommerce merchants.
As an added bonus, most purchases made with Amazon Pay are protected by Amazon’s A-to-Z Guarantee, which covers both the timely delivery and the condition of an online order.
If either is unsatisfactory, shoppers can report the problem to Amazon, who will determine if they’re eligible for a full or partial refund.
2. Streamline your checkout
Baymard also found that 28% of shoppers have abandoned online carts due to too long or complicated of a checkout process.
Adding Amazon Pay as a payment method at checkout saves time for your customers by allowing them to use the address and payment information they already use with Amazon.
Rather than having to enter in their payment and shipping information, they can log into their Amazon account and complete checkout in just a few clicks. This contributes to a seamless checkout, which can help reduce cart abandonment and keep customers coming back.
3. Offer omnichannel payments
Omnichannel commerce has been one of the biggest buzzwords of 2018 — and for good reason. Harvard Business Review reports that 73% of shoppers used multiple channels to shop.
The biggest takeaway from the rise in omnichannel shopping this year is that you need to offer a consistent buying experience across channels, especially mcommerce and desktop ecommerce.
Amazon Pay makes it easy for customers to buy online, on mobile, and even via voice — like through an Amazon Alexa device — through the same ecommerce innovations that power Amazon.com.
Overall, a streamlined, secure, and omnichannel shopping experience has never been more important to online shoppers.
We can expect to see Amazon Pay offered on more and more online stores in 2019.
Offering this payment method at checkout can help you increase conversions, reduce cart abandonment, and boost customer loyalty.
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