On an unstoppable mission to give online retailers the broadest eCommerce tool set to grow sales and profits, we announced last week support for PayPal Express Checkout for our merchants in the U.S., United Kingdom, Canada, Australia and Germany. Not to disappoint us a number of online retailers immediately had questions on this checkout solution: How is it different from regular PayPal? What are its benefits? Can it help reduce my payment processing costs? Should I activate PayPal Express Checkout or Google Checkout? To answer some of these questions I have created below a brief primer on PayPal Express Checkout (Reader’s Digest version: turn it on).

Short on time? Here are three three important resources that will help you better understand its benefits, when and how to use it, and hopefully answer any questions that you may have:

• PayPal Website Payments Pro - Express Checkout is part of PayPal’s Website Payments Pro package, a comprehensive payment solution including credit card payment processing and PayPal’s Virtual Terminal product.

• ChannelAdvisor’s PayPal Express Checkout mini site - Integrated into our Strategy & Support Center, our mini site provides valuable information on PayPal Express Checkout, instructions on how to activate it within ChannelAdvisor Complete, an FAQ and more.

• PayPal Express Checkout webinars - You probably already know that we’re big fans of education and this new feature is no exception. We will be holding two webinars together with PayPal on PayPal Express Checkout during the next few weeks to help merchants understand the product and how it can drive incremental sales.
  • U.S. Webinar: Wednesday, 08/01, 2 p.m. EST. Register here.
  • U.K. Webinar: Wednesday, 08/17 at 2 p.m. GMT. Register here.

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eBay will be making some good changes to its PayPal Financing Program next week which should drive incremental sales (anything you can do give your buyers more payment options is a step in the right direction):

Starting the week of July 9th the more popular standard buyer financing offer will automatically appear - free of charge - on listings that are currently selling for $50 or more and are from U.S.-based sellers who qualify for PayPal Buyer Protection.

Other financing options will be removed from the site, and sellers will no longer be able to select them during the listing process.

More details can be found here.

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Searching for the perfect checkout is like the search for the Holy Grail, except that the latter was probably more fun with adventures in far-away countries, on horse back and with sharp objects at your disposal. Every online retailer has a different checkout flow with most of them too long, confusing and at times even unreliable. A new study study by the UK’s e-Consultancy group now indicates that checkout abandonment rates could be as high as 80% as a result of poor usability (here’s a good interview with the author Dr. Mike Baster on checkout best practices). That can’t be good for business.

Google Checkout’s arrival last year raised the profile of checkout and its significance for conversions and sales (with Yahoo! replicating the search tie-in) but it also set a new bar for checkout simplicity and ease-of-use for buyers. Recently PayPal has turned up the heat with its PayPal Express Checkout product that doesn’t outright replace the entire checkout but conveniently lands the buyer on the retailer’s “complete your checkout” page (for more interesting reading check out last week’s Internet Retailer’s report on third-party checkout adoption rates among the leading online retailers). And before you ask, yes, ChannelAdvisor supports today Google Checkout and will have good news shortly for retailers looking to add PayPal Express Checkout as an option for buyers.

So what are buyers looking for in a checkout (and what will positively impact cart abandonment rates)? Here’s my unscientific list:

• Security & Trust – Above all I’d like to make sure that my payment information doesn’t end up in Madagascar. I heard it’s a nice country and all, but the data is for you Mr. Merchant and nobody else. That’s no big deal if you’re a brand-name merchant since I trust that the thousands of shoppers before me were okay (Google didn’t report anything on you losing credit card data), but it’s a little bit of a challenge if you’re new to me. May simply be a small token of safety similar to what Global Golf has done with its Hacker Safe feature at the very top of the screen.

• Speed – Make it fast. Very fast. I have already spent time selecting the right product, let’s just get it over with and don’t give me any opportunity to get confused and quit. Want to build a relationship with me? Follow-up on the order to make sure I got it, give me a chance to rate the transaction and then allow me to opt-in to a newsletter (call out that you’ll be sending out promotions and not product announcements — if there’s no good reason I won’t do it). I bought a good bag recently at eBags and was excited when I was asked to rate the deal, glad you care.

• Simplicity – Speaking of confusion, I don’t really care to subscribe to any email lists, financing offers, the same product in different colors or a wishlist during checkout. Every time I buy something at a site I end up automatically getting a newsletter and that counts against you, Mr. Loyalty Builder. Remember, the more you hit me over the head with the size and the color of the checkout button, the better. I don’t want to guess what I need to do to pay you right now (before I change my mind).

• Personalization – And please, please, please: recognize me. I hate data entry. Point and click. Have a guest checkout for shoppers that have privacy concerns. I’d rather register (IF you have other products I am interested in) so that next time I just have to indicate “yeah, ship it to me” and get back to my show. Amazon’s One-Click works for a reason.

• Options – And while I may like the payment options you have (doesn’t everyone accept credit cards these days?), it’s important that you offer me some progressive checkout solutions before I even get into the weeds of your marketing maze. Yes, I am talking about Google Checkout, PayPal Express Checkout and Bill Me Later. A good number of leading eTailers are already offering this (Starbucks is a good example of how this can be done) so get on the same page. In a perfect world I’d also like for you to default to my preferred checkout method.

Whew, that felt good.

And although I am a big fan of Google Checkout, I have recently found a checkout that beats hands-down anything I have ever used. Wait, it wasn’t even me. My son, a new Webkinz addict, showed me a few days ago what he can buy in this virtual world and I was stunned. Here’s a checkout that doesn’t ask how I want to pay for the product (use what I always use unless I object) or how it should be shipped.

Now where am I going to put my new virtual trampoline?

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Via auctionwire comes the news that PayPal has recently been given an Online Safety Leadership Award by the Authentication and Online Trust Alliance (AOTA) in the eCommerce category.

“With more than 143 million accounts worldwide, PayPal is trusted by its customers because the service was designed from the ground up to be the safe way to send and receive money online. We are combating phishing and spoof through the use of leading security and anti-fraud technologies and collaboration with the industry, law enforcement, and consumers alike, said Michael Barrett, chief information security officer at PayPal. We are delighted and honored to be recognized for our leadership role in keeping our customers safe and preserving trust online.”

Well-deserved recognition. As a consumer I think that PayPal is a tremendous payment system and the best way to send & receive funds from other individuals (death to paper checks …).

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Ina at AuctionBytes recently reported on a new features survey sent by PayPal to select merchants. Very good insight into where PayPal may be heading as a checkout solution rather then a consumer-to-consumer payment method. While I didn’t get to vote (…), I am sending PayPal below my prioritized wish list (here’s the list of features with descriptions):

(1) PayPal Customized Coupons and Discounts — This is a standard checkout feature these days (Google Checkout supports it) and a matter of catching up rather then innovating (although PayPal supports today eBay-only coupons). Lots of room for improvement all around so let’s see what they come up with. Better yet, build it so ChannelAdvisor online retailers can use their existing coupons defined in ChannelAdvisor Merchant via an API.

(2) PayPal Buyer Loyalty Program — My favorite one by far. Especially eBay merchants growing their off-eBay business (and every eBay PowerSeller ought to do this) need to focus on building buyer loyalty, and I believe this feature helps incent the buyer to come back. Here’s what it also has to support: the ability to restrict the coupon by channel (for example, only off-eBay but not on-eBay since I am likely already discounting the product to acquire the customer), payment method (standard PayPal vs. credit card) and — this is really icing on the cake — by risk (PayPal Seller Protection and unconfirmed vs. confirmed address). No big deal, right?

(3) PayPal Warranty — This could potentially be another “look ma, no hands!” revenue stream (similar to handling and insurance) for merchants that do not offer today a warranty on top of what the manufacturer provides (especially if it is easy to track through PayPal). I never buy the extra service plans offered by a Circuit City or Best Buy, but there’s a market for it and to some degree this again can increase buyer loyalty (”we’ve noticed that your warranty is expiring, would you like to extend it or buy a replacement product?”). Or throw in a free warranty to differentiate your product …

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