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BizReport : Ecommerce archives : January 19, 2009

Rosetta: Retailers embrace alternative payment methods

Offering alternative payment methods is just one way in which retailers can attempt to lower shopping cart abandonment rates. But which alternative payment methods are the leading retailers employing?

by Helen Leggatt

rosetta logo.jpgAdoption of Google Checkout started out strong, but a recent study by interactive agency Rosetta shows that retailers are becoming more comfortable with a variety of alternative online payments and Checkout adoption is slowing.

Of 100 leading online retailers surveyed, 37% now offer alternative payment methods, ways of completing an online transaction without using the normal credit card authorization process. That's an increase of 23% since November, 2007, found the survey.

The most popular alternative payment method among the 100 leading retailers surveyed was Bill Me Later, with 26% (up from 21% in November, 2007), followed by PayPal with 25% (up from 19%) and Google Checkout, now used by 11% and up only 1% from over a year ago. Just 7% of retailers surveyed offered all three alternative payment options.

"Even though it boasts high consumer confidence, Google Checkout is struggling in retailer adoption," said Adam Cohen, a partner at Rosetta's consumer goods and retail practice, which conducted the study last month. "Adoption of the service started out very strong last year, but has stagnated in the last 12 months."

In other research, a January 2009 Javelin Strategy and Research study reveals that, despite the uptake in alternative payment methods, credit card purchase volume will continue to grow online and command the largest market share among payment types, reaching $107 billion by 2013, up from $81 billion in 2008.

Tags: alternative payment methiod, Bill Me Later, credit card, Google Checkout, PayPal

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