Amazon Payments: A Complete Guide for Ecommerce Merchants

E-commerce businesses have opened so many doors to do business. A shopper can simply relax in the house and still make purchases from a wide range of choices. To get this working, there has to be a seamless transfer of money and products.

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Online shoppers look for the convenience of shopping and expect a smooth customer journey. One of the most important aspects of any e-commerce business is online payments.

When it is online payment, a store owner not only worry about the shopping experience but also about the security of payments. The more payments your store supports the more versatile is the payment experience.

While most businesses by default have support for debit cards and credit cards, something that is less focused on is the other modes of payments. One such not to miss e-payment methods is the Amazon pay. Click To Tweet

Below shown are stats on the percentage of users who are aware of digital payments or Amazon payments.Digital payments or Amazon payments

Courtesy: Statista

Below is the age-wise classification of users who have used Amazon payments specifically.Age-wise classification amazon payments

Courtesy: Statista

Surprisingly, in each age category, more than half the population is aware of Amazon payments. The percentage of people using this service is gradually increasing as more online stores are integrating Amazon payments.

Amazon payments are available across most leading e-commerce stores. Owing to its popularity and wide user base, its clearly an option you need to consider while building payments for your online store.

Let us further understand more about Amazon’s pay.

What are Amazon Payments?

Amazon payments or Amazon pay is an online payment service launched by Amazon. The service gives users an option to pay using their Amazon accounts. So, using details stored in your Amazon account, you can pay and shop across other websites.

Currently, this is available across the below list of countries:

  1. Austria
  2. Belgium
  3. Cyprus
  4. Germany
  5. Denmark
  6. Spain
  7. France
  8. Hungary
  9. Luxembourg
  10. Republic of Ireland
  11. India
  12. Italy
  13. Japan
  14. Netherlands
  15. Portugal
  16. Sweden
  17. United Kingdom
  18. The United States

One of the key reasons to consider Amazon payments is owing to their large user base. Most businesses have reported an increase in conversion after integrating with Amazon Pay.

Benefits of Amazon payments

One of the key reasons for using Amazon payments is to allow users to shop with the card details stored in their Amazon account. The complete onus of payments is on Amazon and is handled by Amazon. Amazon being such a hugely popular and widely used marketplace, secure payments is completely handled.

Below are some not to miss benefits of Amazon payments.

  1. The service gives protection against online frauds. This is extremely important for any online store. If you have just launched a store, then integrating with Amazon payments keeps your payments secure. At a low cost, you can enjoy the highest standard security provided by amazon payment methods.
  2. Relevant to security, Amazon also has the ability to send instant alerts in case it detects any security issue or unusual activity with your account.
  3. At all times customer financial information is kept safe and prevented from being shared with sellers. Customer does not have to worry about where the financial information is being typed in, since these are within a portal they have used earlier.
  4. Amazon provides a purchase guarantee wherein a refund will be provided in case the product is not delivered and the seller is not helping.
  5. A similar guarantee is also provided for a damaged product or if the product is of sub-standard quality. For such issues, Amazon provides a refund.
  6. Another benefit of using Amazon pay is its easy accessibility and availability across multiple stores. A lot of users know about Amazon payments and have explored it.
  7. This is a service that makes shopping experience convenient. Users use a familiar portal which is the biggest advantage and saves a lot of time during checkout. This reduces complexity in payments.
  8. Amazon being a trusted brand, most online shoppers feel safe while using these payment methods. This is true, especially, while exploring new shopping portals or new sellers. User online payments are managed safely.
  9. With Amazon pay, users can anytime check payment history and can track purchases.
  10. As an added advantage, Amazon payment users earn rewards, cashback, points, and several such incentives.
  11. With the incentives provided by Amazon, users eventually save money or can make an alternate purchase at a discounted price.

Clearly, there are several benefits of integrating Amazon pay to your online store. You surely will not see a dip in the number of shoppers abandoning shopping carts owing to complex payment process.

Retaining more customers and attracting new buyers is clearly two things that Amazon payments can guarantee to a greater extent.

Pros and Cons of Amazon payments

Some of the pros of using Amazon payments are as highlighted below:

  1. This has a huge customer base
  2. It’s a popular and trusted platform
  3. A secure platform that guarantees safe payments
  4. Provides buyer guarantee and provides refund on a case to case basis
  5. Supports fraud detection and generates alerts wherever applicable
  6. Strong technological integration for seamless payments along with payment information security
  7. A good option to consider in case you want to scale up your sales
  8. It is easy to get Amazon support

There are not too many downsides of using Amazon payments. However, there are some that we need to consider and need to be aware as an online store owner before integrating this payment method.

Some of the cons of Amazon payments are as highlighted below:

  1. While a lot of users trust Amazon services, owing to its huge customer base a slight security glitch can put a lot of payment as well as demographic information at stake. The risk could be higher. However, no such issues have been reported so far.
  2. Amazon has a more stringent verification process. So, there are possibilities that some of the purchases may fail during the payment phase owing to security issues. As a seller, you won’t be able to control this failure, however its best to add a disclaimer on your website. This is to ensure; buyers are aware about this and the payment can be handled offline once the seller contacts Amazon to resolve such payment issues.
  3. For first time users trying to integrate Amazon pay with their store may be a bit tedious owing to the significant amount of paperwork, while it is easy to integrate from the technology end.
  4. Integrating Amazon payments with different e-commerce platforms vary. The effort required for integration depends on the underlying e-commerce platform support. Some platforms ensure, customers do not have to leave their website to use Amazon payments, though this varies from platform to platform.
  5. Amazon payment pricing varies based on geographical region. The pricing is almost same as the other payment models. This is 2.9 % + $0.03 for each order

How does Amazon pay work?

Amazon pay is one of the popular modes of payments available in several online stores. This is as popular as PayPal and is considered as an alternate payment method. Click To Tweet

A regular checkout page might look something similar to below:Amazon pay

Here the customer has to fill in multiple details that include demographics, shipping information, billing, and payments. Most likely by the time the user reaches to fill the payment details, the user will attempt to drop off.

To avoid such cart abandonments the online store should have a smooth and seamless user experience where the user does not have to provide so many details. This is also one of the key reasons why most online stores look forward using Amazon pay.

Below is a screen shown during checkout, that provides the Amazon pay option. Clearly this is a more simplified checkout process. The user does not have to fill in multiple details as all details are already available in the Amazon account.Amazon pay option

Courtesy: PlayBetter

Another similar example is a more customized checkout option showing Amazon Pay.Customized checkout option

Courtesy: Mountain Crest Gardens

This is an option, to use especially if you own a small business, where you do not have to worry much about the payment processing and payment security. Another such example is as shown below.payment security

Courtesy: Priscilla Boutique’s

A simple Amazon pay button can make your website journey faster and can quickly help to improve conversions. A strategy that lets you grow your business and have a smooth shopping cart to payment experience.

To use the Amazon payment method, an online store can integrate the Amazon button using the Amazon payments SDK. A lot of e-commerce store building platforms such as Shopify, Magento, BigCommerce provide easy integration to use this button.

Here is how the Amazon button works:

  1. On checkout, a user will click on the Amazon pay button
  2. The user will be redirected to an Amazon hosted page where the user can sign in using the Amazon portal credentials
  3. The user is returned to the online store website to complete the checkout process
  4. The user chooses the card details either debit or credit that they would choose to complete the payment. These are details stored in the actual Amazon account.
  5. The user completes the payment and receives a receipt from Amazon Pay.

For this service, Amazon charges the sellers a transaction fee. So, Amazon will forward the amount to the seller after deducting the transaction fee. These transactions are settled by Amazon on the same day and hence the seller does not have to wait too long to receive the amount.

To get started, the seller will have to register for the Amazon pay service. To do this, one can login to Seller central that is available on the Amazon website. Here you can setup your account. Once this is complete, from your e-commerce platform, setup the Amazon pay button. This can be previewed and tested in sandbox before taking it live. You would notice how simple it is to start using Amazon payments from here on.

Conclusion

Every online store should consider using Amazon pay. While this has a small transaction fee, the benefits of using this are many. Especially, small and medium-sized businesses should look at options for integrating Amazon payments to minimize their operational cost and see significant growth in sales. Click To TweetAmazon payments provide a quick shopping cart experience.

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