More Payment Options Increase Online Sales

    November 14, 2007

Online retailers are accepting more forms of alternative payments from shoppers in an effort to ease fears about online fraud according to a new report from payments processor CyberSource.

On average online retailers accepted 2.6 different payment types this year, up from 2.1 in 2005. Providing more payment options increases online retailers sales, last year sales increased an average of 14 percent for retailers offering three or more payment methods.

"As online shopping continues to grow, it is critical to not only expand your product assortment," but to also offer "alternative means of payment," says Marty Keane, senior vice president of e-commerce at Bluefly an online retailer.

According to Avivah Litan, an analyst at Gartner, online sales are not growing as fast as they could because of shoppers concerns about identity theft from online payments. Over half of online consumers who are nervous about identity theft have changed the way they shop online a Gartner survey revealed in August. Thirteen percent said they stopped shopping online and 68 percent said they were more careful where they made purchases online.

Online shoppers "should use the same skills for the online experience that they do in the real world," George Peabody, director of Mercator Advisory Group told USA Today. "Don’t go to places that you don’t trust."