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Tuesday 15 October 2019

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Payments Awards 2019

Half of SME online retailers exploring payments tech

Written by Hannah McGrath
14/08/2019

Almost half of small to medium-sized (SME) online retailers are exploring flexible payment options (49 per cent) and e-commerce technologies (48 per cent) in the coming year, according to new research from Klarna.

A survey of 100 decision-makers at UK-based online retailers by the payments company found that SME retailers are increasingly open to investing in e-commerce technologies to meet customer expectations of instant and frictionless shopping experiences.

However, the survey showed that online retail SMEs face a number of challenges when it comes to adopting new technologies, with over half (53 per cent) saying the cost of introducing flexible payment options was the biggest barrier to adoption.

The UK’s uncertain economic outlook was also inhibiting tech spend, the survey found, with almost half (48 per cent) saying that Brexit-related uncertainty was the main reason they’re currently halting investment. This was followed by the 31 per cent which cited a lack of knowledge over what tech will provide the best return on investment as the major blocker to investment.

But 54 per cent said competition from bigger players and online giants is the biggest external challenge currently impacting them; a factor which Klarna suggested could impact online retailers’ bottom line in the long run.

Despite this, the survey showed that a number of online retailers have plans to upgrade customer experience in the next 12 months, with 74 per cent having built an omnichannel experience incorporating physical presence of their business in the past.

Yet while customer loyalty remains stable, the research showed that SMEs are losing more customers than they should during the checkout process with one in five (21 per cent) visits result in an abandoned basket.

Luke Griffiths, UK general manager at Klarna, said: “Shoppers today demand a frictionless buying experience from browsing to checkout, so it’s encouraging to see that so many online SME retailers are looking to bring new technologies into their businesses to enhance customer experience.

“Being small in size doesn’t have to mean small-picture thinking. SMEs have the advantage of agility, and are often better equipped to do a fast integration than their larger counterparts.”


Retail Payments Survey

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