How Payments Orchestration Can Help Firms Make The Digital Leap During The Pandemic

The COVID-19 pandemic has prompted a worldwide surge in demand for digital commerce and content as consumers stuck at home search for new channels through which to make purchases and stream entertainment. Businesses are understandably following suit, adjusting their operations to cater to customers’ growing preferences for digital-first everything. Some firms are setting up websites for the first time, while others are enhancing their existing online channels by rolling out new payment features.

Many businesses are learning too late that it takes more than simply providing digital products, offering numerous payment methods and generating sales to build successful eCommerce and digital content businesses, however. Firms must also effectively manage the operational systems that tie these myriad features and functions together, according to Matt Monahan, vice president of product at digital content management firm Arc Publishing, a division of The Washington Post.

Monahan recently spoke to PYMNTS about how payments orchestration strategies can help businesses manage these complex systems, boost their operational efficiencies, maximize conversion rates and ultimately enhance their digital presence.

Rethinking The Basics: Cloud-Based Platforms

The first step to selling online is also the hardest for many companies: setting up their own sites. Monahan explained that many businesses entering the eCommerce ecosystem have historically not had the resources to build their sites in-house from scratch.

“Companies were developing a lot of their own capabilities in-house with a traditional IT function, and it’s [hard enough to support] just the basic needs of providing a commerce platform or running your website, never mind all [the requirements of modern eCommerce],” he said.

The result has been that many businesses are unable to get a solid eCommerce foothold, let alone build out cost-effective and flexible systems that can adapt to consumers’ rapidly changing expectations.

An integrated, cloud-based content management system (CMS) could offer key benefits by allowing firms to access an eCommerce ecosystem that might otherwise be unobtainable. Such arrangements enable businesses to perform necessary payment functions without building them into their own IT systems. They also offer the flexibility to tweak payment operations without fundamentally altering their supporting infrastructure.

“I think the types of practices that we’re talking about — aggressive testing, personalization, frictionless checkout flows — these are ideas that I think are pretty well-established out there, and so now people are just looking for the capability to do it, looking for the best practices and looking for the integrated approach,” Monahan said.

The trouble is that some businesses looking to build a digital presence may be unfamiliar with cloud-based platform offerings and what distinguishes them from more traditional IT infrastructures. Many firms — including some that have sought Arc Publishing’s assistance — have begun their digital engagement journeys during the pandemic and now must decide which systems to use, despite having little back- ground on what differentiates cloud-based offerings from the rest.

“For some of our customers, this is the first time they’re launching an experience or content — or the first time they’re launching a new subscription experience — and so we found ourselves over the past six months having to be pretty consultative and also delivering new product features to help customers build those new businesses across a variety of markets,” Monahan explained.

Firms that seek out solution providers like Arc Publishing understand that their current CMS operations can be improved, Monahan noted. They may lack the terminology to explain or pinpoint what their businesses require, however, and it can be difficult to convince them to invest in technologies with which they are not familiar.

“There’s both the technical challenge of building the stack and capability to do things like test … features on your site and then there’s also the culture change within the organization that you need [to enable these] types of practices,” Monahan said.

Arc Publishing and other providers often find themselves playing the role of educator, working to inform their clients about the benefits of using a cloud-based CMS so they can make better-informed decisions about which system to implement.

Orchestrating Payments To Manage Costs

Having flexible IT infrastructure is a crucial component to building a successful eCommerce business, but managing the various functions necessary to ensure smooth operations can be challenging for both merchants and platforms like Arc. Payments are just one part of this expansive and complex machine, but they can become a burden if not properly managed. Providing the payments experiences that eCommerce customers and digital content readers expect often requires multiple integrations to offer various methods, anti-fraud services and other related functions. The challenge then becomes managing these interlocking payment integrations.

Many new eCommerce entrants aim to solve these frictions by enlisting help from payment orchestration providers — third-party firms that can simplify the payments process and tailor it to each business’s unique IT infrastructure. Understanding how comprehensive payments orchestration layers can streamline potentially burdensome integrations requires considering operations from the perspective of a website manager, Monahan said.

“So, imagine you’re running a commerce site,” he explained. “You run the site management part of it over here, you have some sort of headless CMS that you run over here, you need to add capabilities for … testing, and pretty soon, the stack is pretty complex and you’re spending a lot of time just trying to keep it stitched together and working properly.”

Payment systems that become too costly or time-consuming to maintain can eventually deteriorate operational efficiencies and eat into firms’ bottom lines. An effective eCommerce payments strategy thus requires businesses to store, analyze and act upon the payment data they gather on their customers, suppliers and their own, internal operations. This could mean implementing dynamic pricing functionalities that charge vendors based on their financial situations or leveraging data analytics to determine the payments gateway that is best suited to each customer and transaction, optimizing transaction success rates.

“One of the biggest challenges that you’ll see is … every gateway kind of handles things a little bit differently,” Monahan said. “Each of them has different capabilities and, a lot of times, we’re working with customers that operate multinationally, internationally [and] across multiple markets.”

They may also be using different credit card processing systems and bank integrations, all of which can affect a payment gateway’s transaction success rates. Firms therefore often use payments orchestration layers, which can be easily integrated into their cloud-based CMS structures and leverage artificial intelligence (AI) and machine learning (ML) tools to make real-time determinations about which payment gateway will produce optimal results for a given transaction. Arc Publishing utilizes payments orchestration provider Spreedly, for example, and firms that establish part- nerships with such providers can also reap lower maintenance costs by avoiding building their own orchestration systems from scratch.

Employing various payment integrations and related tools can ultimately help firms improve their sites’ functional abilities. Leveraging the right orchestration tools to bolster and manage multiple integrations rather than doing so on an individual basis could be key to freeing up the time and resources firms need to thrive in the digital age.