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Year 2000

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So you want to sell over the internet?

One of the most important factors of your e-business strategy is the company or product you choose to help you to sell over the web.

First, here's three key internet payment systems you should know about :
Google Checkout
• Can be linked to Adwords promotions • A variety of integration options to suit most website owners
Find out more about accepting payments with Google checkout...

PayPal
• Quick implementation (within hours) • No advanced technical requirements • No Existing Merchant Services Agreement required • Also allows you to accept payments from users who don't like using a card over the net.
With over 63 million account holders to their name, you have to take them seriously! Find out more about accepting cards with PayPal...

Barclays Merchant Services - ePDQ • Slightly longer time to implementation (days to months) • Slightly more advanced 'minimum technical requirements' • Existing Merchant Account required or must be applied-for & accepted • Choice of simple or highly integrated implementations available for your site. Find out more about how to apply for these Barclaycard Business Services...

Using your current off-line merchant account.

Surprisingly, some UK banks used to recommend that you take your visitors' credit card details using a standard e-mail form on an SSL secured web site, then manually process the business through your existing offline PDQ machine. This is the cheapest option available, because your are not introducing any 'middle men' , but there are a number of problems with this approach:

First of all, you may not have an existing merchant agreement, thus rendering those credit card details useless!

Secondly, even if you do accept credit cards offline, be aware that e-mails are relatively insecure. E-mails can either intentionally or accidentally bounce into the wrong hands. To solve these problems you could always encrypt your electronic mail before sending it from your website, then decrypt the messages when they arrive on your hard drive. Many hosting services, however, do not allow encryption software to run on their servers so you'll either have to change hosts or try a different approach.

Finally, this may be a sensible solution if you are anticipating a small number of transactions per week, but as soon as your internet shop takes off it'll become cumbersome and you should start to look at other methods.

On-line payment

If your business is to succeed online it needs to be able to take payment in real time online. This means your "shop door" is truly open 24/7.

There are a number of options available to those wishing to accept credit card payments online:

Using 'ePDQ' with your own dedicated secure server.

[Please Note: Since we wrote this article (Feb 2001) Barclays Merchant Services have introduced a better ePDQ system that allows you to accept online payments without having to have expensive dedicated internet servers (so, can be used with your virtual hosting packages) ]

Barclays Merchant Services are, at present, the only UK bank that provide the technology to enable you to link directly into their 'online cash register' from your own website. In order to use their services you must first apply and be accepted as an ePDQ Internet Merchant (even if you have an existing agreement with them). Then, load some special (MCK) software onto the (secure) server that hosts your web site. This software enables your server to 'talk' to their technology and conduct transactions.

The problem, however, is that many hosting companies are unwilling to load extra software onto their servers for customers using their 'standard' hosting packages.
One solution is to upgrade and seek web hosting on a dedicated server, this could cost thousands of pounds a year - is it worth it? Furthermore, even when you are paying for a 'managed' dedicated hosting package, the hosting company's support team may, still, not be willing to install any special payment software/modules - they don't want to 'carry the can' if it all goes wrong (insurance premiums 'an all that).

Hosting your website on a dedicated server has many advantages and the costs are always tumbling, but if you cannot justify the expense at this time, there is a third way...

Using the services of an Internet Payment Service Provider.

There are many Payment Service Providers (PSP's). Some require you to have an existing Internet Merchant Agreement with your bank or another Merchant Service Provider. If this is the case, the Payment Service Provider essentially provides you with a secure system for accepting payments over the Internet.

If you do not have an existing Internet Merchant Agreement, many can either point you in the right direction or offer an in-house solution. (PayPal, for example, will make agreements with most businesses. So, if your bank has declined your application, PayPal may be able to help).

Another example is Clickbank.com . Like PayPal, they offer an online payment system package that allows you to start accepting credit cards over the net within hours of registering with them. However, you must be selling soft goods (e.g goods that do not need to be shipped after payment). Examples of soft goods are; e-books, downloadable data, and services.

In addition to the payment facilities, most PSP's offer additional services such as hosting, online shopping baskets, marketing services (e.g membership of malls, affiliate programs etc.). Within the Clickbank.com package, for example, an affiliate system is already set-up. Therefore, you just need to decide how much commission-on-sales you wish to offer to those people who direct/refer buyers to your website. Then, give out a simple web address, so affiliates can register to start earning by sending you buyers. Every 16 days Clickbank then divvy-up the dosh, taking a cut, and everyone's happy. One of our advertisers uses this system, and it took us about 15 minutes to get their advert up and running on our site.

Payment service providers such as SECPay, NetBanx, WorldPay and Datacash provide a service that enables buyers to clear their credit card payments at the time that they buy online. Companies such as SECPay specialise in online authorisation of debit and credit card transactions on the internet and collection of funds directly to your merchant account. These services are integrated into your existing website. There is normally an annual or monthly fee to be paid as well as either a set price per transaction or a percentage of each transaction. It is obviously a good idea to check out as many of these service providers as possible before committing yourself.

However, you still have the issue of being one of many millions of websites trying to make their presence felt, the next step is to find your customer or to help your customer find you. Companies such as Secure Payment Company exist to help SMEs connect directly to the consumer via the internet.

Having become something of an expert in the ecommerce field they offer a marketing service to help SMEs sell directly to the consumer complete with an online loyalty device to help keep their customers. They were one of the first companies in the UK to take their sales online and in real time and are in a position to pass their expertise on. If you don't want to go it alone, Secure Payment Company provides full e-commerce functionality, website review and a marketing plan in return for a share in margin on sales.

Reseller programes and affiliate schemes are another way of reaching a wider audience whilst sharing margin, however the most popular way to find a website is still using a search engine. Search engine submission and key words can play a vital role in the development of your e-strategy. But that is another story....

Further Details.

PayPal
Accept credit cards today - Clickbank.com
Barclays Merchant Services - ePDQ

Sign up for PayPal and start accepting credit card payments instantly.



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modified: May 25th 2001