The Cross-Border Merchant Friction Index

September 23, 2020

Do eCommerce consumers in New Zealand have the same needs as those from South Korea? Well, it largely depends.

With a global economy changing the pace and ease with which consumers can make purchases, check-out needs on eCommerce marketplaces converge or diverge based on geographic location. Language and currency differences, preferred methods of payment and shipment tracking require consideration by merchants before sites go live.

Luckily, options abound. Over half of European eCommerce sites employ IP recognition technology, a tool that determines a consumer’s location for auto-adjustments to language settings and payment options. Localizing check-outs enable merchants to add features tailored to specific consumer needs by location, helping boost international sales and conversion rates.

Ultimately, IP recognition technology— like other features employed by merchants—aims to optimize user experience (UX). In collaboration with FastSpring, PYMNTS has recently published The Cross-Border Merchant Friction Index, a study of 266 eCommerce merchants and the number of check-out features (from a total of 47 options) they offer to consumers.

Research Methods & Results

PYMNTS ranks the “smoothness of their overall checkout experience” on a scale of 0-100. By their own definition, “A score of 0 indicates a checkout so friction-laden that no consumer would be able to complete it, while a score of 100 indicates a checkout so smooth that no consumer would abandon their carts before completing their purchases.”

The research found that the top 20 eCommerce sites tailored checkout processes to their consumer’s preferences and, additionally, provided value-added features to entice purchasing. For instance, all of the top 20 sites extend some measure of a refund policy, while the lowest ranked sites offer none. The Merchant Index, as described, can give merchants useful information for customizing check-out options to their consumers, both at home and abroad.

See PYMNTS for more information and access to the report.

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