Introduction
One of the key factors for a successful online store is offering payment methods that meet the needs of your customers.
Shopify offers the following payment methods as its main payment methods: Shopify Payments, PayPal, and Amazon Pay.
Nowadays, one in two Japanese people have an Amazon account. Considering its overwhelming popularity, it is no exaggeration to say that there is no reason not to introduce Amazon Pay. However, there are actually many more benefits to introducing Amazon Pay than are generally known.
In this article, we will explain the benefits and points to note that our staff experienced after actually implementing Amazon Pay.
First of all, what is Amazon Pay?
This is a service that allows you to make smooth payments using the information registered in your Amazon account, even on sites other than Amazon.
Customers do not need to register payment information or enter their address, and can simply log in with their usual Amazon account. It is characterized by the ease of being able to shop with just a few clicks.
Benefits of Introducing Amazon Pay [Basics]
Now, let's take a look at what kind of benefits there are to actually implementing it. First, we will list the generally recognized benefits. If you already know them, please skip ahead to the [Recommended Edition].
Increased conversion rates
By using Amazon account information, the checkout flow is dramatically shortened. Since users do not need to enter cumbersome information (shipping address or credit card information), it prevents so-called "cart abandonment" and leads to an increase in conversion rate.
New customers are expected to be acquired
When using an e-commerce site for the first time, you are required to enter customer information, but if you have Amazon Pay installed, this step is not necessary.
This will prevent customers from abandoning the site because they are worried about entering their card information. In addition, by displaying the Amazon logo on your company's e-commerce site and stating that Amazon Pay is available, you can reassure customers and often lead to new customer acquisition.
Security that gives you peace of mind
Payments are made through Amazon's security system, so first-time users can use it with peace of mind. It also reduces the security costs for stores, providing peace of mind to both buyers and sellers.
Benefits of Introducing Amazon Pay [Recommended Edition]
Next, we will introduce the benefits that our company has experienced after actually introducing Amazon Pay.
Easy to deploy
Installation can be completed in just a few steps. For detailed installation instructions, please refer to the separate article.
→ Amazon Pay integration steps for Shopify
Fraudulent Order Detection
We use Amazon's security system to monitor your account and credit card for fraudulent use 24 hours a day, 365 days a year.
If a transaction deemed fraudulent is detected, you will be notified immediately, allowing you to take action such as canceling the fraudulent order before the product is shipped. As a result, you can prevent chargebacks from occurring.
When a fraudulent order was actually detected at our company, we received an email from Amazon's security team notifying us of the fraud about five hours after the order was completed. This is a very reassuring system for shops.
There is no deadline for refund processing!
The time it takes for a credit card refund to be processed varies depending on the payment processing company.
With Shopify Payments, the deadline is 60 days from the date of order, but with Amazon Pay, there is no deadline!!
If you cancel after the refund deadline set by the payment processing company, you will often have to go through more complicated procedures, such as refunding by bank transfer, but with Amazon Pay you don't have to worry about that.
With Amazon Pay, when 180 days have passed since the order date, the order status in the admin screen will automatically become "Closed" and you will no longer be able to "capture" the amount. However, there is no deadline for refunding amounts that have already been charged, so refunds are possible even if the order status is "Closed."
This should also be a great source of reassurance for shops when selling pre-order items whose release date is several months away.
Amazon Pay transaction management page
You can (indirectly) introduce credit card payments such as JCB, which are not supported by Shopify Payments.
Shopify Payments supports credit cards that are not supported in Japan. In particular, the fact that JCB cards, which are widely used in Japan, can be used by default is a major benefit for both sellers and buyers.
Expected to improve Life Time Value (LTV)
Have you ever tried to make a purchase from an online store only to have your payment not go through because the credit card information registered with the store was out of date?
Amazon is one of the most widely used e-commerce sites in Japan, and it is likely that the credit card information registered to your Amazon account is always updated and up-to-date.
Therefore, with Amazon Pay, there is less risk of credit card expiration, which may prevent customers from abandoning the store. As a result, we can expect an increase in LTV.
Important points to note
So far, we have explained the benefits of implementation, but there are also a few things you should be aware of and be aware of.
Be careful when implementing this on cross-border e-commerce sites!
If you have a cross-border e-commerce site, you need to be careful when introducing Amazon Pay!
Amazon Pay can only be used by Japanese Amazon accounts (amazon.co.jp) for businesses based in Japan. In other words, customers with overseas Amazon accounts cannot make purchases. Therefore, it is safe to say that Amazon Pay is not suitable for cross-border e-commerce sites.
The fees are a bit high
Let's take a look at the implementation costs of Amazon Pay.
- No initial cost or monthly fee
- Payment fee: 4% (4.5% for digital products)
When comparing payment fees, Shopify Payments charges 3.25% to 3.4% (for domestically issued cards) and PayPal charges 3.6% + 40 yen, so Amazon's 4% may seem expensive.
However, as mentioned above, when you consider the benefits such as increased conversion rate and LTV, security, and no refund deadline, it can hardly be said to be too expensive.
summary
In this article, we have introduced the benefits of introducing Amazon Pay from the shop's perspective.
Overall, Amazon Pay is a service that provides great convenience and security to both customers and stores. Although there are some points to be aware of when implementing it, considering the benefits it brings to customers and stores, we believe that Amazon Pay is a payment method that must be implemented. Please consider it.
