Benefits of Third Party ecommerce apps

Among the great things about being on a top ecommerce platform — Bigcommerce, in my case — is the ability to easily connect third-party apps into your shop.

Apps are born from a person’s desire to use the native platform in a new and exiting way. Some apps are developed to make jobs more efficient, while others concentrate on making operation more robust. Sometimes an app is intended to simply do something in a slightly different way.

Gradually, I will navigate the Bigcommerce app shop to find out if there’s any new or exciting apps that may help me drive revenue, improve conversion rates, help with customer retention, or help to make the job of running my online shop simpler.

It is important to understand the technical consequences of installing an app on your live environment. By way of instance, if you are installing an app that will handle your stock, back up your existing inventory database, as it will probably be impacted during the installation procedure. Other apps may need you to make small modifications to your store’s theme. Again, it is a fantastic idea to back up the theme’s files before modifying the code.

Secondly, consider whether the alteration will truly add value to your internet shop. As an example, if your client base has a technical knowledge of how to utilize your goods, it would be a huge value to link those people through improved product reviews, including a comment section on product pages, or perhaps creating a community in your online store.

Lastly, consider the time and energy about the management and supervision of this app. If you are rolling out a loyalty program, which member of the group will decide and implement the rules on when customers should be rewarded? How much of the process do you need automate and how much should keep the human element? While apps can offer you unprecedented chance, be mindful what will change on both the admin and the client side.

Ecommerce platforms have a vetting procedure to list an app. But there are cases when apps will be available out of a platform’s official app shop. One easy way to check whether an app will work for you will be to create another shop, to experiment. If you realize that you are constantly tweaking things, you may consider paying for another monthly subscription. Alternately, the shop’s trial period is a terrific mechanism to accomplish this.

Apps can have different pricing models which are oftentimes success based. One of my favourite apps, Signifyd, is an extra layer of fraud tracking. It delivers a pricing model that’s free up to a certain number of transactions in exchange for putting its logo on your internet shop.

A fantastic way to unlock a reduction or use services free of charge is in exchange for articles promotion or a case study that highlights how you’re utilizing the app. This is a mutually beneficial way for both you and the company that developed the app for brand exposure.

Apps can transform your shop into something new and exciting for both you and the clients at very little cost compared to hiring a company to construct a proprietary solution. Most apps provide support and are upgraded, to change with the times.

Credit Card Processing: American Express OptBlue Rates Often Wrong

Can you change credit card suppliers or renegotiate pricing with your current provider in the previous year? If so, did you confirm that you’re really receiving the fees and rates you negotiated?

Here is the second installment of a two-part series on confirming that your credit card processing charges are accurate. The first installment, “Check Credit Card Processing Rates before Holiday Rush,” we released last month.

Credit Card Processors Make Many Mistakes

I have mentioned the poor excellent control from the credit card business in previous articles. In my experience, around 25 percent of merchants aren’t getting the pricing they negotiated due to mistakes on the application, order entry errors, or for other reasons. Earlier this year, more than 50 percent of the merchants I audited had pricing mistakes. Even worse, 100 percent of the mistakes forced the merchants to pay a greater cost.

… around 25 percent of merchants aren’t getting the pricing they negotiated due to mistakes on the application, order entry errors, or for other reasons.

This is quite concerning, not just due to the high proportion of mistakes but also because all of the mistakes favored the providers. One would expect some proportion of mistakes to prefer merchants if the mistakes were truly random.

I had several conversations with merchants and their credit card salespeople with this problem. The results were eye opening. Not one of the salespeople I talked with had completely read their particular application and terms and conditions. Nor did they completely understand them.

Some of the salespeople could not answer basic questions on provider fees versus card company charges. Some felt sick trained on finishing their own merchant applications. Worst of all, sometimes, if the salesperson failed to complete the application properly, certain prices and fees could be set at the supplier’s default settings, which were greater than the negotiated rates and fees in most cases.

Some of the mistakes I saw included:

  • The American Express rate set in the supplier’s default amount of 3.50 percent, rather than the negotiated OptBlue speed;
  • PIN debit markups in the supplier’s default rate rather than the negotiated rate;
  • Incorrect discount rates;
  • Discover card monthly access fees, debit monthly access fees, and numerous additional monthly fees which should not have been billed;
  • The MC Acquiring License fee set at 0.41 percent rather than the supplier’s actual rate of 0.0041 percentage;
  • Numerous per-transaction charges which should not have been billed. A few of the errors resulted in yearly overcharges totaling several thousand dollars.

Maintain a Separate Document to Record Rates and Charges

Merchants should maintain another document along with the supplier’s proposal and contract. The merchant’s record should list all negotiated supplier prices and fees in addition to the card companies’ pass-through prices and fees. The salesperson should agree to the fees and rates on the merchant’s record and confirm the very same rates and charges on the supplier’s contract prior to the merchant signs the contract.

Following the merchant receives her initial announcement with the new rates and charges, she should confirm with the salesperson every fee and rate on statement. The fee and rate contrast between the merchant’s statement and document ought to be exact. There should be no fees and rates on the announcement that weren’t on the merchant’s document. Some providers actually offer a comprehensive list of pass-through fees in their proposal, which makes this process quite straightforward.

Following the merchant receives her initial announcement with the new rates and charges, she must sit down with the salesperson and confirm each fee and rate on statement.

American Express OptBlue

Did your supplier convert your account into the American Express OptBlue program during the past year or so?

I’ve received more calls from salespeople around the OptBlue program than from merchants. Some of the salespeople were panicking at the prospect of losing merchants because the merchants’ American Express cost had increased — not diminished — after they were put on the OptBlue.

The American Express OptBlue pricing arrangement is much easier than other card companies. Unfortunately, many suppliers have done a dreadful job of teaching their salespeople on the program and the actual rates and charges charged by American Express.

I’ve encountered a few of merchants whose cost increased after being put on the OptBlue program. If you’re among them, understand it is your merchant account provider’s fault rather than American Express. Any increase in cost is likely either a consequence of your supplier’s desire to boost gain or its failure to find out that the OptBlue impact on your current cost.

OptBlue should significantly reduce the processing cost for many ecommerce and brick-and-mortar merchants. But some businesses, as such medical, already get favorable pricing from American Express — so OptBlue may actually increase the processing cost in these situations. Other merchant types might not profit from OptBlue pricing also due to their pricing structure. But, American Express has communicated these nuances to the providers.

What I find most concerning, however, about the OptBlue program is the large number of merchants which have been automatically converted to OptBlue by their provider and the supplier has kept all or the majority of the cost savings.

What I find most concerning, however, about the OptBlue program is the large number of merchants which have been automatically converted to OptBlue by their provider and the supplier has kept all or the majority of the cost savings.

By way of instance, a small ecommerce merchant that’s not on OptBlue generally pays 3.50% + $0.00 to American Express on a $50 sale. For OptBlue, barring any international or particular issue charges, American Express fees the supplier wholesales prices and pass-through prices of 2.15% + $0.10 to 2.45% + $0.10 on the same $50 sale. This wholesale cost is even lower for brick and mortar merchants. The supplier then adds its own mark-up on into the wholesale cost.

If your provider automatically converted your company to OptBlue, did it pass along the savings or are you being billed a pre-OptBlue rate of 3.50 percent for ecommerce?

Even if the supplier is charging through the proper wholesale and pass-through fees, is your supplier applying the identical mark-up — state, 0.10% + $0.10 — for American Express as it’s with Visa and MasterCard?

American Express OptBlue is a really good program for most merchants. But, read my 3-part series from 2014 on OptBlue and utilize my PDF”American Express Pricing Checklist” to safeguard your prices are right.

The OptBlue program is a test of a supplier’s integrity and its own desire to assist its merchant clients. Take action if your supplier (a) did not pass across the OptBlue savings, (b) is charging a higher mark-up than for Visa and MasterCard, or, even worse, (c) is causing your processing cost to rise. Decide if you wish to renegotiate with that supplier or find one that cares more about your company.


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