Customers are increasingly adopting the SMS payment method. So if you want to delight your customers, you should start accepting payments by text messages.
According to the latest study from Weave, 35% of customers want to pay by text messages. However, only 4% of small businesses are having this payment option.
Small businesses strive to improve customer relationships. And allowing customers to pay by text messages is one way to do it.
What’s more, being able to accept payment by text messages can also provide your small business with an edge. This is because most businesses have yet to start receiving payment by text messages.
Small Business Consumer Behavior
When it comes to making payments for purchased products/services, customers want flexible options to pay.
Some customers prefer using their credit cards, while others like making payments with their smartphones.
If customers find that stores don’t accept their payment methods, they can’t buy from there.
In fact, 38% of small business customers, as the study finds, haven’t been able to make a purchase because the store couldn’t process their form of payment.
It goes without saying that customers are now avoiding carrying cash. 43% of small business customers carry less cash today than they used to carry one year before.
In the absence of cash, customers opt for digital payment methods. And the trend of mobile payments is growing fast.
Talking about making payment by text messages, 35% of customers want to pay with a text from their phone, as the study states.
Younger customers prefer paying with texts more than older ones do. 62% of buyers under the age of 35 always or frequently pay with a text if the store accepts payment via texts, discovers the study.
How Small Businesses Accept Payments
Though customers today expect flexible ways to make payments for purchases, not all businesses are having multiple options to accept payments.
Only 16% of small businesses offer more than three forms of payment options, according to the survey.
What is more surprising here is that only 4% of small businesses can accept payment by text messages, while more customers want to pay with text messages.
The more methods small businesses have to accept payments, the more they win over young customers. 40% of small businesses say that accepting more payment types will help them cater to young customers.
Small businesses having four or more payment options generate 7X more annual revenue than those having fewer than four payment options.
Takeaway on SMS Payments
As a small business owner, you should try to have more payment options. This will provide your customers with more flexibility to pay. Consequently, more customers will buy from you.
If you start accepting payment via text messages, you can cater to young customers more.
Jeff Lyman, Chief Product Officer at Weave, said in his prepared statement, “As a business owner, the more convenient you make it for your customers to pay you, the more often you will get paid. While this seems evident, a lot of small business owners today still only accept cash, check and credit card payments,”
“Now more than ever, in the midst of this pandemic, we’re faced with the reality that payments are the lifeblood of a business. Yet even with this new host of simple and remote digital payment options, we’re still seeing a delay in their adoption from small business owners. Adopting these newer technologies like text-to-pay, Bitcoin, and digital wallet services like Venmo or Apple Pay speeds up the rate at which these businesses get cash in the door and saves them dollars due to typically lower processing fees associated with these more modern solutions,” He added.
About the Study
Weave commissioned an independent market research firm to conduct this study. The firm surveyed 380 small business customers and 350 small business owners. The objective of the survey was to know how customers pay and how businesses process payments.
Look at the infographic below to know more about the findings of the study.
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