Online Payments in the Dating Industry. Quick Start Guide

Transcription

1 Online Payments in the Dating Industry Quick Start Guide

2 Introduction Online dating websites have completely changed the way we meet new people - whether doesn t matter if we re looking for a serious connection or for someone just to have fun with. Competition in the online dating market is growing and because there are lots of services relationship-seekers can choose from, online dating business owners have to provide the best customer experience to ensure their service is truly easy to use. We ve spent 15 years learning about the problems with payments in the online dating industry and made our own analysis. Now we re giving you the lowdown on what matters most when you want to accept online payments. Let s dig deeper into payments for dating websites. Share it

3 Table of contents 1 Why should you accept payments on a dating website? Matching users Messaging system Premium features simplified payment process with the right solution 2 Choosing a dating payment provider. What should you consider? Technology and integration Security and fraud mitigation Dividing transaction volume across multiple merchant accounts Conversion Subscription payments Mobile solution Costs A service for users around the word Support you can count on 3 Make a match with the right payment provider

4 1 Why should you accept payments on a dating website? Each year, millions of people turn to the web in search of a significant other. In the UK alone, UK 7 million people were using online dating in 2016 and it s estimated that 15% of Americans have used dating services or apps. According to reports, the trend is going to rise in the coming years. Love-seekers can choose between free and paid dating sites. Why do some of the websites for relationship seekers want them to pay? Free dating sites have their drawbacks, which includes being lower quality because they re open to everyone. It s assumed that free sites are great when first starting out, but people who pay for using a dating website are more serious about finding their perfect match. Share it

5 5 Matching users Basically, free dating sites provide limited services to users, e.g. offering to search by location only. On the other hand, paid websites offer a detailed personalization with many different preferences. Users need to answer a series of questions describing their details, interests, etc., as well as describing the perfect mate to find the best dates possible for them. There are a variety of methods for making matches, but mostly it s based on certain criteria. Free websites usually offer just a simple search, and paid ones usually come with a highly specific advanced search, using an in-depth capability.

6 6 Messaging system The same thing happens with a messaging system. Usually, when users want to contact the person they re interested in, they need an upgraded account. In most cases, they aren t able to initiate contact with other website members. Everything starts with a short message and offering paid extras, such as virtual winks, hugs or kisses to make it easier for love seekers to flirt and break the ice. Keep in mind that paying for this kind of interaction (with virtual items or emojis) must be extremely simple, with one-click. Paying for virtual winks, hugs or gifts must be extremely simple, with one-click. #dating #payments When using a paid dating service, people usually get their own dedicated inbox, which seems to be a safer option to chat with people they don t know. There s no need to give out personal information, which makes people more comfortable. Think about it this way: when someone pays for using a dating service, they take it more seriously. Free sites could come with more scams, fake accounts and naturally more potential fraud.

7 7 Premium features Many dating websites offer premium features for users or charge them for each item, such as the afore-mentioned virtual kisses or flowers. It s a great way to engage people, as well as grow your business performance. Premium users can also boost their profiles in search rankings. Paid sites also offer quick and efficient customer care and exclusive events that might be an opportunity for many singles. There s no question that all this creates a better dating experience. Paid dating sites also sometimes run promotions, e.g. a lower price on subscriptions, so when it comes to using a payment system, it s important to have a solution that enables you to set up a tailored scenario. Dating services also need to make sure they provide seamless and hassle-free payments on their website in order to keep their high quality of service on track.

8 8 Simplified payment process with the right solution Providing high-quality service on a website (without pushy ads screaming in the user s face, and with lots of great features that can simplify the search process) is a characteristic of premium dating sites. The key, though, is to make sure your payment system doesn t lag behind. That s why choosing the right payment provider is so important. It will not only help you grow but create a one of a kind dating experience that provides a quick and user-friendly solution. When you put consumers first, they will put you first. #dating #payments #UX By simplifying the way users pay, you can improve your conversion rate and build a long-term relationship with your audience. When you put consumers first, they will put you first. Read on to learn more things that should be considered before choosing an online dating payment provider tailored to your needs.

9 9 2 Choosing a dating payment provider. What should you consider? Now that you know choosing a payment provider for your dating website is more important than you might have originally thought, it s time to get down to the nitty-gritty. In other words, how to offer easy-to-use payments without redirection and with simplified user flow can increase conversions on your website.

10 10 The first thing you should know is that you ll fall into a defined Merchant Category Code (MCC). Different category types have a higher or lower impact on payments and conversion rates on your dating website. The MCC is provided by Card Associations but you need to know that it is the acquirer that decides which type is proper for your business model. A dating business can be categorized simply as dating (with the 7273 code) but also as a high-risk business (with 5967 code). In the latter one, the content of the website is one of the decisive aspects (adult content vs. mainstream). The final decision may be the result of a type of website content, your current chargeback ratio, and the acquirer s opinion. There are lots of MCC codes and for your business, it s better to get the 7273 code (dating), which gives you the higher approval rate and better conversion rate. A code that is even better in regards to approval ratio is social media, but this category is not so easy to obtain. Make sure the payment platform you want to choose works with your industry to avoid rejection in a compliance process. What are the most important things that make the payment process on your dating website a smooth and seamless experience?

11 11 Technology and integration Forget about complicated integration that takes ages. Look for a payment solution with a powerful technology that enables you to implement payments in hours instead of weeks. There are also solutions for nondevelopers, so you can add your payments by dragging and dropping the payment button. Remember that the easier the implementation, the cheaper it will be for you in the long run. You save time and money as well. It s important to have the possibility of implementing a payment solution using any programming language to handle a payment scenario that will work best for your dating business. What to focus on? Ask a payment provider about the technology they use. Do they provide a flexible APIs? Do they offer payments without redirection? Note that when you choose a payment gateway with APIs, you can set a tailored payment scenario, but it also makes you the owner of the code. This means you have full control over the entire payment process on your website. It also comes with what everyone is looking for today: customization. You can create the payment form that will completely meet your needs. The fact that the user stays right on your page and is not redirected to an external site also matters. You can easily track and analyze the way your customers pay for your service. We ve noticed that our clients who changed payments with redirection to the custom form, increased their conversion by at least 2-3%.

12 12 Security and fraud mitigation From years of working with dating business owners, we ve observed that one-third of dating websites have major problems with fraud. Now, it s one of the biggest threats in online dating. Dating fraud is becoming more sophisticated and, according to the stats from the City of London Police s National Fraud Intelligence Bureau, online dating fraud in the UK cost 27 million in Most online dating websites prevent users from revealing their personal details, such as address, phone number, etc. so they feel secure. The same should occur with online payments on a dating site. The industry comes with lots of chargebacks and fraud attempts so providing solutions with the highest level of security is paramount. We can even say that chargebacks are the nature of the online dating landscape. Chargebacks are the nature of the online #dating landscape. #fintech #fraud Scammers can use stolen cards to get access to a dating site. Any fraud attempt results in threats to a business, such as chargebacks or higher banking fees. To limit any fraud attempts, dating websites need highlysecure solutions with several security layers and highly accurate antifraud tools.

13 13 To prevent and mitigate the risk, choose a payment solution with antifraud tools, based on machine learning technology. It will help you score every payment and check it against fraud. You, as a dating business owner, know your customer base best. You should have the option to decide what to do in order to strike a balance between conversion rate and account longevity. With proper tools and information from your payment partner, it will be much easier for you to keep control of the payment security on your website. The advanced set of filters and multi-level protection is what every paid dating website needs. Extra security layers, such as tokenization, 3D secure, or blacklisting will give both you and your customers the certainty that payments on your website are well-protected. For high-risk businesses (online dating could be one of them), it s better to have a dedicated merchant account and work with a payment provider that has experience in this field.

14 14 Smart 3D Secure authentication Do you think that 3D Secure technology is a conversion killer? What if we told you that you re wrong? You can now choose a solution that gives you a non-invasive 3D Secure i.e. that lets you accept secure payments without losing customers. Even if the customer s card is not enrolled, the transaction will be accepted. It s up to you how you set up the 3D Secure solution, so you don t have to worry about a drop in conversion rate. You can make a special offer for clients using 3D Secure authentication while paying. It won t affect your budget that much, and it could help you save on chargeback fees. What s important is that payments on your website will stay safe without hurting your conversion. Smart enough, don t you think? Note that conversion rate shouldn t be the one and only thing you focus on. It is, of course, the major goal, and it helps you control your business performance, but there are other factors you should pay attention to as well. What to focus on? Choose a solution with PCI compliance level 1, so you don t have to bother with it. Lots of payment gateways take the PCI burden on themselves, so you can be sure credit card data will never hit your servers. When you choose SecurionPay, the data is sent to our tokenization server and you are provided with a token representation of the card. Also, ask your payment provider for customized antifraud tools based on machine learning technology. These tools let you manage your payments manually or automatically by pre-selecting parameters. With a fraud prevention system, you get the information about a fraudulent transaction before things go wrong, so it helps you avoid chargebacks.

15 15 Dividing transaction volume across multiple merchant accounts With risk diversification, your online payment transactions are split between multiple bank processors. This means you can work with one payment gateway and split transactions across a few acquirers. Our experience shows that dating websites usually have a large amount of traffic, so risk diversification is a great solution to prevent technical failures. It can also help with a sudden increase in sales volume by simply reducing the risk to your business. All in all, it helps you to efficiently distribute incoming traffic across a few merchant accounts under one payment gateway account. The main benefit is effective transaction monitoring, especially when your service has high number of transactions. This solution is also a way to mitigate the risk of fraud and reduce chargebacks. With a backup and multiple bank partners, it is much easier to mitigate risk. One payment gateway gives you access to multiple acquirers. All your stats are kept in one place which makes the entire process easier and more convenient. What to focus on? Ask your payment provider if they work with multiple banks, so they can offer you risk diversification, especially when you have a high volume of traffic on your website. It will help you reduce the risk and mitigate payment technical errors. At SecurionPay we are constantly expanding our list of banking partners to maintain website traffic and split it to make sure there aren t any technical problems.

16 16 Conversion Running a business - no matter what kind - comes with the chore of analyzing major metrics and optimizing activities to improve performance. For dating websites, one of the most important things is the number of registered users converted into paid subscribers. At the same time, converting visitors into members is one of the biggest challenges for online dating websites. The online dating industry is growing larger every day, so it s crucial to run a business that converts well. That s why choosing the right payment provider to help you reach a goal is more important than you might think. Since the entire payment process has a huge impact on the conversion rate on your website, it should be as short and simple as possible. You have to limit the number of fields in a payment form to those that are really needed. Actually, only three fields are really necessary - the card number, expiration date and security code (CVV). Requiring the bare minimum works great on dating websites because most users don t want to share their names. Wondering how to increase your conversion rate in only two weeks? Grab an ebook

17 17 Simplified user flow is what your customers expect. Just three input fields, such as card number, CVV and expiration date, are enough to complete a payment. Provide users with a solution that lets them pay on your website with one click and gives them much more than just a payment option - a convenience of using your dating service. You can be sure they will love you for that. Card number Expiry date CVC mm / yy 123 What to focus on? Online payment providers offer a bunch of additional features to give both you and your customers convenience. You can offer users a Remember me option which lets them pay with one click, without having to remember their credit card details. Each time they go to pay, they will see a checkout with pre-filled data so they only need to enter in their CVV. They can pay for virtual kisses, winks, or buy their match a gift. You can also set up a one-click cross-sales, which can be set up between MIDs. This will help maximize customer lifetime value and grow sales. You can use it to offer customers related products or services right after they complete the initial transaction. Using cross-sales can increase your sales by up to 20%, - definitely a game-changer for your business.

18 18 False declines can hurt your conversion Speaking of conversion, there is another huge problem for merchants, one that costs them $8.6 billion (according to Business Insider 2016 estimates). This is false declines, also known as false positives that could be more expensive than a fraud itself and could significantly decrease the conversion rate on dating websites. In short, false declines are incorrectly rejected valid transactions. This happens when a user wants to pay on a dating website (for a membership or for an item) and then the transaction is declined. A bank may consider a website high-risk with a bigger number of frauds, and decide it needs to protect the user. The problem is that the issuer makes its own decision, without even asking the customer for permission. This, of course, leads to customer frustration and the conversion drops when the cardholder is not able to use his or her card due to the issuer s block. Note that a payment processor, as well as the acquirer, is helpless in this situation. It s the bank s decision so the only solution is to try to clear it up for a customer (a card owner). That s why it s better to get a dating MCC code (7273) from an acquirer than being qualified as a high-risk merchant (5967). There are about 100 decline codes that issuers may use to flag a transaction, so it s better to work with a payment processor that knows how to analyze them. It s important to know the reason for a decline, because you may not only lose growth opportunities, but also waste the cost of customer acquisition.

19 19 Subscription payments There are basically two types of dating sites: one with a subscription where a user is billed a certain fee every month, and another when you sign up for free and buy tokens to use each time you want to do a certain action, such as sending a message to somebody. Speaking of a subscription model, charging customers at regular intervals makes it much easier to predict cash flow. It s up to you what the frequency of payments will be. It might be monthly, quarterly or a yearly amount. Note that most mobile dating apps require payments for certain actions instead of using a pay-over-time model. You can use recurring payments to make your own scenario. For instance, think of providing a 2-weeks free membership before charging people for using your service. It s a great chance to get more engaged users. Online dating first-timers need time to decide whether they are looking for a relationship in the right place. The easier the dating service is to use, the more of a chance you have to convert first-timers into experienced users that will stay on your site longer. What to focus on? It s good to first determine which type of payments your company needs. Do you want to only process recurring payments or also charge the customers for one-time payments (e.g. for a specific items)? retention, so you may offer a variety of billing cycles with flexible time periods and multiple pricing levels. Consider what is more viable for you and create your own plans. Make sure a payment platform gives you the option of setting up a payment scenario tailored to your service. Ask for the possibility of making an unlimited number of plans to improve customer Compare your needs with the features the payment provider offers to make sure that you will have everything you need in the future.

20 20 Mobile solution The online dating industry, as well as other internet industries, are going mobile. With new technology developing, dating business owners are seeing their traffic move rapidly to mobile because people are more willing to flirt on the go. Today it s easier than ever before, because of larger screens on smart devices and the improved design for mobile users. Providing a smooth and seamless experience with mobile users habits in mind is a must. It should be also related to additional solutions, such as payments. It s not that easy to insert all the payment information on a small screen, so only dating websites that provide a perfect design and mobile-friendly solutions will be successful. Online businesses that accept payments need to understand that providing seamless, quick and safe mobile payments is absolutely necessary. Let your customers pay on the go - when commuting, in a queue, or even during a lunch break. The checkout process for mobile has to be as simple as possible. Without redirections, distractions, misleading links, buttons, etc. You should ask only for essentials and users of your dating website should be able to pay quickly. What to focus on? Choose a payment platform with: Paying for a transaction with a single tap is what mobile users want. There s nothing pleasant in entering loads of information on a small screen. Immediacy is one of the key drivers that attract mobile customers. So, purchasing needs to be reduced to one action. ww ww ww ww User-friendly design, including bigger input fields, without any distractions, needles links and other elements. One-click payments to pay on the go in seconds. Don t make love seekers enter in all the card details every time they want to send a wink Simplified user flow and payments without redirections. Text input on mobile should be reduced to a minimum. Fewer clicks mean more sales, it s as simple as that. Ease & convenience of payments, anytime and anywhere.

21 21 Costs For most business owners, thier pricing and fee structure is particularly important. Remember that price is one of the factors when choosing a payment provider, but not the most important one. You ll find a large number of payment platforms with similar fee structures, but there are also other things you need to consider to achieve your business objectives. Even if a #paymentgateway seems to be more expensive, it could make up for it in the end. #dating #payments Making a price your central focus can lead to disappointment, for instance, when you hit upon hidden conditions. Find a provider with a transparent pricing structure and remember that nothing with value is free. Even if a payment gateway seems to be more expensive, it could make up for it in the end. Note that many payment processors require a rolling reserve for so-called high-risk businesses. This is when a payment processor withhold a percentage of a certain amount from the merchant for a short time in the event of chargebacks or some unexpected costs. For instance, SecurionPay offers a rolling reserve from 5 to 10% for six months, depending on the volume processed. What to focus on? Make sure that the payment provider you want to work with won t require any extra or hidden fees in future. Always focus on the REAL cost.

22 22 A service for users around the word It s obvious that love doesn t recognize borders so it s not a good idea to offer your service for just the local market. Our internal research shows that lots of dating websites and mobile applications are used on a global scale. Even if you run a local business, it s good to have the option of providing payments in various currencies. For instance, when choosing the SecurionPay solution, you can add a checkout (simple pop-up with payments) to your website which is translated into 23 languages and detects the user s country automatically. You can also accept payments in over 160 currencies around the world. What to focus on? Ask about the number of currencies you can accept on your website, including the currencies in which you want to receive your payouts. Multi-currency payment processing is what every dating business should consider. Giving users the option of paying in their local currency can mitigate the risk of chargebacks. Why? Customers often look at the amount, but forget to check the currency displayed. Then, when they see a different amount on a bank statement (which was caused by currency conversion) they are more likely to contact the bank and ask for their money back as they simply do not recognize the transaction amount.

23 23 Support you can count on Before you choose a payment provider for your dating website, check their customer support. Do they have a tech team that can give you additional tips to maximize the platform s features? Getting real help from a payment provider will help you to achieve better results and improve a service from a user perspective. It s also important for you to be certain the support team will be very responsive, especially when problems with payments occur. You can t afford a solution that will cause intervals in accepting payments on your website. What to focus on? To make sure there are no problems with a certain payment gateway and their customer service, give them a try. Choose one that lets you test their solution before you go live to make sure it will really meet your needs. And last but not least: It s extremely important to choose a payment provider that will also be your PAYMENT PARTNER. One that will always have you covered, whether you run a successful business or you struggle with some problems.

24 3 Make a match with the right payment provider There you have it. Now you know the most common things your dating website should provide and what to consider when choosing a dating payment provider. Now it s your turn. Choose wisely and make a match with the right payment platform to provide your users with a unique experience. For many love seekers, online dating is more convenient and efficient than trying to find someone in real life. It allows them to sort out the people they might have an interest in. Giving them a convenient and user-friendly solution can do wonders for your business. It s better to focus on quality over quantity, in every aspect of your business. Want to know more? See 10 Reasons To Choose SecurionPay As Your Dating Payment Provider. Share it

25 25 Why SecurionPay? SecurionPay is a Swiss-based, cross-device payment platform that provides credit and debit card payments, focused on flexibility and security. With 15 years experience, we specifically tailored our solution for online dating industry. We know lots about the expectations, needs and worries you may have. We were even called the company which is shaking up dating payments. Want to ask something? Feel free to contact us at support@securionpay.com or sales@securionpay.com. Recurring Payments Mobile payments No redirections Cross sales 160 currencies Better shopping UX

26 Authors Sandra Content Marketing Specialist Tech-savvy personality, experience in writing and passion for reading. Staying up to date with the latest social media trends, in love with GIFs. Lucas CEO Lucas is a CEO at SecurionPay. FinTech Innovator, Payment Expert, API Fan, Startup Enthusiast & World Traveller. Share this knowledge with friends: