The Impact of Accepting Credit Cards and Mobile Payments
Apr 30, 2013
Did you know that the majority of business in America today do not accept credit cards? What is the economic impact of avoiding credit cards and mobile payments for these businesses? Merchant Warehouse has developed the following presentation to help more clearly define how accepting credit cards and mobile payments can increase sales and improve your bottom-line.
- Impact of Accepting Credit & Mobile Payment vs. Cash Only
- Personal finance experts have long claimed that paying electronically instead of with cash leads to spending more money. The ease, convenience, and intangibility, they say, all make us more likely to overspend. In the last few years, studies have confirmed this belief and highlighted the benefits for merchant who take advantage.
- This presentation explores the bottom-line impact of accepting credit cards and mobile payments instead of cash only.
- Spending Rises with Credit Card Acceptance: According to the Journal of Experimental Psychology, McDonald’s saw its average order amount rise from $4.50 to $7.00 after taking credit card payments. Order size increases of up to 40% are possible after merchants accept credit cards for the first time. Shoppers spend 12-18% more when using credit cards instead of cash.
- The Mobile Payment Opportunity: Mobile payments offer the same frictionless and convenient payment experience as credit cards. 20% of 2012 holiday sales were made through mobile devices. Mobile payments are projected to rise from $47.2 billion in 2011 to $998.5 billion in 2016.
- A Practical Example of Before and After Cash-Only Payments: Assuming you own a small convenience store in your home town and project a modest, average order size increase from accepting credit and mobile: Before– Orders Per Day 200 – $15.00 Current AOV– Average Daily Revenue $3,000; After– New AOV After Credit/Mobile $18.00 – New Average Daily Revenue $3,600 That’s the difference of $90,000 versus $108,000 in monthly sales!
- Accepting Credit and Mobile Payments is no longer a luxury. it is a convenience your customers demand and a sure-fire sales booster for your business.
- Sources:Journal of Experimental Psychology; The Money Answer Book; Yankee Group; IE Market Research
- Learn more at https://cayan.com