Multichannel selling is a reality for a majority of small-to-medium
sized merchants, but payment processing capabilities lag far behind,
according to a new research study commissioned by SecureNet Payment
Systems. The study, conducted in partnership with First Annapolis
Consulting, evaluated the degree to which small-to-medium sized
merchants conducted business through multiple sales channels, in order
to assess not only how the merchants currently process payments, but
what needs weren't being met by their payment providers. The research
study is available for download at: www.securenet.com/merchantsurvey2013/.
More than 60% of merchants surveyed already accept payments in more than
one channel, but these merchants are not well served by the payments
industry today. A key finding is that in many cases, each new selling
channel requires a different payment provider; in fact, 27% percent of
merchants surveyed had three or more payment processing software
solutions to facilitate payments by channel. Because of the ineffective
implementation of a payments strategy through a single, omnichannel
payment processing provider, merchants struggle with unnecessarily
complicated reporting, complex reconciliation processes and ineffective
transaction pricing structures.
Small businesses identified the two most important issues regarding
their multi-channel payments as:
Access to reporting that is easy to understand, and
The ability to easily understand how cash flows across channels.
Additionally, nearly 50% of single channel merchants anticipate
implementing multi-channel commerce in the next five years. Among single
channel merchants contemplating a multi-channel strategy, the three
issues ranked most highly (important or very important) were simple
technology (49%), easy integration with existing technology (46%), and a
single solution for all of the merchant’s payment needs (41%). Lower
pricing came in fifth, with 39% of single channel merchants indicating
it was important or very important in a multi-channel solution.
Large multi-channel merchants naturally face different challenges than
64% of merchants with sales above $5 million report inventory control
as a large or very large issue compared with 35% of small merchants.
45% of large merchants indicated that facilitating a consumer purchase
in one channel and a return in another channel was a large or very
Likewise, large, single-channel merchants have a different set of
concerns than their smaller counterparts regarding the implementation of
a multi-channel solution:
71% indicated that strong technical support would have great impact on
their desire to implement a multi-channel solution versus 38% of small
57% identified reconciliation tools as being a key to multi-channel
commerce versus 27% of small, single channel merchants.
Nearly half indicated that integration into the merchant’s other
payment solutions would have a very substantial impact on their
ability and desire to implement a multi-channel solution.
"This research study confirms that traditional, single channel payment
partners are simply not fulfilling the needs of a large segment of
American businesses,” said Brent Warrington, CEO, SecureNet Payment
Systems. "The successful multichannel SMB will look for not just a
payments processor, but a technology partner that can scale with a
merchant as business needs change. A truly omnichannel payments solution
offers multichannel merchants the most effective way to streamline
payments across all channels with improved ease, speed and costs. As
merchants demand better solutions, the payments industry will see more
"The prevalence of multi-channel merchants is not conjectural or a
phenomenon that may happen sometime in the future; multi-channel is here
and now," said Marc Abbey, Managing Partner at First Annapolis
Consulting. "Merchants have had to expand their modes of interaction
with their customers to address multi-channel consumer preferences and
competitive factors in most merchant industries."
About the respondents: The SecureNet research encompassed merchants
ranging from small, single-location merchants to large chains. The
average merchant had four locations, although the median respondent had
a single location. The largest respondent had more than 2,500 locations.
The merchants represented diverse industries. Business-to-business
categories accounted for 14% of the respondents, retail represented 10%,
and not-for-profit made up 9% of respondents. Over 97% of the
respondents were the owner, the accounting manager, or the manager of
operations/IT of their company.
SecureNet offers the most innovative payment technology operating system
directly connected to the major card networks available in the market.
SecureNet’s technology platform enables merchants to accept any payment
type, anytime, anywhere through point-of-sale, eCommerce and mobile
acceptance. Sophisticated payment APIs and flexible architecture
simplify integration and empower merchants and developers to design and
control their own payment roadmap while monetizing their business
solution. As a direct payment processor, SecureNet delivers cost
effective solutions by passing on significant cost savings to merchants,
resellers and partners. Processing over $15 billion in annual
transaction volume, SecureNet enables universal commerce for over 19,000
merchants and some of the most well-known brand name partners. For more
information, please visit www.SecureNet.com.
About First Annapolis Consulting
First Annapolis is a management consulting and M&A advisory firm focused
on the financial services industry with a specific emphasis on
payment-related products, services, and delivery. Clients include U.S.
and international financial institutions, payment networks, mobile
service providers, retailers, emerging payments providers, and
government agencies. First Annapolis offers a full range of services
including strategy development, market & competitor assessments,
financial analysis & business casing, strategic sourcing, specialized
risk management, and other payment industry specific services. First
Annapolis also offers a suite of specialized M&A advisory services that
complements our consulting practice. For more information, please visit www.firstannapolis.com.