A particular philosophy pervasive among software platforms is that software companies should allow customers to choose their own payment processor. This is often referred to as the “agnostic” payment model. Although allowing customers to make that choice may appear to deliver the best experience, we are actually finding the opposite is true.
Let’s take a quick look at three key areas that are almost always negatively affected by this strategy.
We often find that processors in an agnostic payment environment price themselves below market to win new business. This not only significantly reduces the revenue opportunity for you but it puts your customers at a greater risk for hidden fees and “rate creep.” This can lead to customer attrition, which also hinders your revenue.
Everything from customer underwriting, boarding, training, hardware deployment, device management and ongoing support will vary with each payment processor. Not everyone will treat your customers the way you do.
Consider that mega-mergers and acquisitions in recent years have created payment behemoths that often put shareholders above customers. If any of your providers have recently merged to become a giant entity, your customers may be in for a bumpy ride. In order to keep Wall Street happy, rates tend to rise and customer service tends to get consolidated or outsourced. Neither scenario delivers a positive experience to your customers.
With an agnostic payment model, each gateway and processor integration has its own nuances. This creates added expense for you to build and maintain the payment infrastructure while supporting multiple gateway and processor requirements.
Partnering with the right payment company can help you harness the power of payments and put you on the path to greater revenue growth, customer satisfaction, and expense control.
An exclusive or preferred partner relationship often brings opportunities for you to generate revenue from your customers’ payments. Not all payment companies offer the possibility of earning revenue so be careful with whom you partner.
When there’s only one payment provider, you essentially have a “single throat to choke” if you find that your customers are not being served in the manner in which they deserve. I cannot stress enough the importance of partnering with a provider that values your customers as much as you do. Choose wisely.
If you’re in an agnostic payment environment. It’s not as complicated as you may think to get out of it. I have found that announcing to customers that you transitioning to a new, preferred payment partner is often well received when bundled with other software enhancements such as: a new release, platform upgrades or PA-DSS certification.
Feel free to contact me directly, and we can discuss strategies for shifting your payment environment to one that creates revenue, improves customer satisfaction, and reduces your infrastructure costs.