In order to create the best shopping experience possible, merchants must understand their customers. Many will draw on data from their online stores: transaction data, website traffic, and bounce rates, as well as after-sales surveys.
However, while useful, this data only tells half the story.
It explains what customers are doing, but it doesn’t tell retailers how or why customers act in the way they do. More importantly, it doesn’t tell merchants what their customers now expect from their retail experience. It’s especially important to understand expectations, the how and the why when it comes to the checkout experience. This is the final hurdle between browsing and purchase. Our latest report on checkout trends and behaviours addresses exactly that.
This additional information can help you create the most effective checkout process. And getting the full picture is more crucial than ever, with the value of digital payments for retail sales more than doubling between 2017 and 2023 to reach more than €1 trillion annually. The continent’s merchants want to capture as much of this business as possible.
To help you better understand evolving consumer behaviours, payabl. commissioned a pan-European survey of shoppers from countries including the UK, the Netherlands, and Germany; all markets characterised by advanced payments technology. The study looked at both online and offline behaviour to discover what consumers actually want from a modern checkout experience.
Our report delves into their shopping habits and payment preferences, as well as the critical role that security plays in payments. It also includes exclusive insights from our partners at Consult Hyperion about how you can implement a seamless and secure payment solution that optimises checkout speed while maintaining the highest security standards and ensuring a frictionless experience.
The report identified some interesting trends.
Shifting online shopping habits
Online shopping is being reshaped by shifting consumer habits and expectations.
E-commerce has become an essential part of life, with nearly half (48%) of European consumers shopping online weekly, and 42% doing so monthly. Only one in ten (10%) make daily purchases, which suggests most shoppers plan their purchases.
The average spend per transaction clocks in at £53, though 10% of shoppers make high-value purchases of £100 per transaction. The research also highlighted that many consumers now consolidate purchases to save on shipping costs, take advantage of promotions, or reduce their environmental impact. However, impulse buying does still play a role, often influenced by discounts, free shipping thresholds, and personalised recommendations.
Retailers must therefore focus on optimising key areas of the purchasing journey to create loyal, happy customers. By aligning your marketing efforts with shopping frequencies and encouraging larger purchases through discounts or free shipping incentives, you can successfully secure additional revenue.
The importance of providing preferred payment methods
Payment preferences play a crucial role in shaping consumer experiences. And it’s certainly not a case of ‘one-size-fits-all’.
PayPal is now the dominant payment method across Europe, but there are regional differences. In the UK, debit cards are most commonly used, whilst the online payment method iDEAL is preferred in the Netherlands. Offering localised payment options that cater to these different tastes is essential.
Interestingly, many consumers claim to use cash for in-store purchases, despite a plethora of statistics showing a decline in recent years. This is highlighted in the European Central Bank’s recent study, which highlighted that cash is used in a little over half of point-of-sale (POS) transactions. A desire to use cash for some purchases shows that you still need to provide diverse payment options that cater to different shopping environments and needs.
For larger, high-value purchases, credit cards and Buy Now Pay Later (BNPL) services are preferred for added protection and the ability to spread costs. Our research also revealed that incentivising new payment methods with rewards can help boost adoption.
Moving forward, merchants should ensure they are offering a variety of payment options, tailored to regional preferences and emphasising benefits such as security and convenience.
Creating a smoother checkout experience
The checkout experience has to be smooth, transparent, and frictionless to minimise cart abandonment and ensure repeat business.
Unclear fees and mandatory account creation are among the biggest obstacles to completing purchases. More than two-fifths (43%) of consumers say that a frustrating checkout experience would deter them from returning to a retailer, with UK shoppers the least tolerant of friction.
Despite the industry’s ongoing concerns over cart abandonment, 60% of consumers claim not to have abandoned a transaction within the last six months. This contrasts with retailer-reported data, with some studies estimating cart abandonment rates at around 70%.
This raises an important question: do consumers and merchants perceive abandoned transactions differently? Retailers tend to see any unpurchased items left in a cart as abandonment, while consumers may not view it the same way, perhaps considering only intentional exits or lost interest as true abandonment. So, instead of solely pushing for completed purchases, retailers may benefit from understanding consumer intent at different stages of the journey, creating strategies that engage and re-engage shoppers in a more nuanced way.
Our research also shows that trust is essential for one-click checkout. Almost half (48%) of consumers are open to one-click checkouts, but a similar proportion require assurance from a trusted payment provider like Visa or Mastercard, and 42% want additional security guarantees.
Security is everything
Talking of security, it understandably remains a top priority for online shoppers, with 71% willing to accept a slower checkout if it means stronger fraud protection measures are in place.
However, it’s not clear who should be responsible for fraud prevention. While 44% believe it falls on retailers, banks, or payment processors, just 25% think consumers themselves are responsible, and 32% simply don’t know. This mismatch in beliefs around responsibility highlights the pressing need for businesses to proactively communicate their security measures.
But while security is non-negotiable, you must ensure your fraud prevention measures don’t create excessive friction at checkout.
At payabl., we’re helping Europe’s businesses implement more robust fraud protection and security measures that maintain customer trust without adding unnecessary obstacles to the checkout process. We can help you find the perfect balance between safety and efficiency.
Download ‘The state of European checkouts: Consumer expectations, payment preferences, and security insights’ today to find out how you can create a failsafe checkout experience that works for your customers.