Why You Should Drop Paypal And Get A Merchant Account

Hmm that's interesting. I'd also like to know why the successful transactions take such a hit with Paypal. Paypal is widely used on the internet because it's so convenient, but it's a shame that there are so many pitfalls associated with it.

Great post! Makes a ton of sense, and most bigger names will say the same thing. Not to mention the ability to do one click up sells comes into play.

This is really great information. Thank you for posting it.

However, I do think it has something to do with the market you may be in.

People should get away from Paypal for tons of other reasons, but the reason you have listed is very interesting and intriguing to say the least.

It could be because of the checkout process.

I'll stick with Paypal. I've been with them for 13 years with no complaints. I understand there are some markets that they don't serve. But you draw vague conclusions without giving nearly enough information on what you're doing. Paypal prospers because many people using them can't get merchant accounts.

What criteria did you use to determine "Successful Transaction"?

People would be mad to change their payment processors based on such as basic test from yourself. Since you were not running the test over the exact same time period it kind of makes this test irrelevant.

If you wanted to do any type of real split test then it should be alternating between both payment processors at the same time so the same traffic is being used... and it should be a much longer test than just a few days.

It could have been a number of things that accounted for the difference. But because this was not tested properly you will never know. At the moment you are only just assuming it was caused by your payment processor.

If this is how you test all your metrics then you really need to rethink things.

I'm sure that using paypal is not safe and I don't pay through paypal. I only pay by credit card directly.

I was planning to use PayPal and even did for some time but then switched to a merchant account. Found more advantages as well.
You've provided good statistics. Thank you for sharing!

I see just the opposite in terms of successful transactions; more sales and fewer abandoned checkouts with PayPal.

I also see just the opposite in terms of cost; when you add the downgrade fees, AVS fees, batch settlement fees, customer service fees, statement fees, gateway fees, network fees, PCI compliance fees, cross-border fees, etc. that come with a merchant account, it's very unlikely your effective transaction rate is lower than the single flat rate PayPal is charging you.

Especially once you move some volume and qualify for their 2.3% or 1.9% tiers.

Take every actual cost into account and a huge number of internet merchants are paying 4-6% effective rates through traditional merchant accounts even though they're quoted a base transaction fee of half that before applying.

PayPal obviously has it's pros and cons. The largest benefits are that it has no overhead, and is widely known and used for transactions by consumers. These are both very crucial for the "little guy", or those starting in IM. If you can, having your own merchant account would be ideal. However, jumping the gun too soon and going after a merchant account when you're not yet sustainable is asking for problems.
My advice: start with PayPal, and stick to it as long as you feel very comfortable transitioning, then use what the major players use -your own merchant account.

There is NO way you could view "successful" results for the two. The ONLY thing you could check is YOUR use of that at that time, which really is not the same.

You ALSO have to determine if the checks are the same. Did you use a business account? Did you change the header appropriately? Is your email weird? Are they expats from the US? If the answer to any of those is no, you my lose customers! Do they have a history of chargebacks? are they against paypal? If so, you may lose customers.


And beanstream is owned by digital river! THEY once had a problem with THEIR fulfillment, and #$%^ me, so I disputed the charge, and they blackballed me. The result? Several companies that I WAS a customer of lost THOUSANDS of dollars, because they switched to digital river! They also lost me as a customer. And what of beanstreams "developer page?"

"Our developer documentation team is busy compiling information, and will be posted in the next weeks. We’re close to having it ready for you – and in our defence, please notice the absence of any animated “under construction” .gifs."

************SERIOUSLY***********? You want me to translate? "We decided not to tell you about this! It wasn't worth our time! You should be happy though! We forced you to have to read this, as opposed to seeing a standard graphic." You really have to wonder about the nationality and intelligence of a company that would make such a statement.

ALSO, do YOU have a merchant account? Beanstream doesn't look like it is for that.

Of course, a statement like "drop paypal, get a merchant account" is dumb anyway, as it implies that nobody prefers paypal and that paypal doesn't offer transparent merchant card action, and BOTH statements are WRONG!

Steve

I think it has to do with the fact that Paypal has taken a large bit of criticism amongst internet users lately.

I can honestly say it's nice to see a webmaster with a regular merchant processor than Paypal.

It isn't that Paypal is evil or anything it just shows a more professional approach I guess.

I am sorry to say that I do not think the results are the key mate.

We switched to paypal for our recurring income site that does over 6k per month...and since switching to paypal our sign up rate doubled. LOL.

Yes but what we did was make it easier for the user to sign up. So For this reason my friend I would not say it is your merchant, the reason would be in the way you have your checkout to actual transaction. That is key, we do alot of testing here....and you must know if someone really wants something of yours, they will not care how to pay, they just want it to be easy to set up, as most people are dummies or novices when it comes to this sort of thing, they want ease of use.

Still, if I were you, you need to test things again, its more likely in your checkout procedures and page load times. This has alot more to do with it rather than you merchant account. We have proved this time and time again. So you need to look at more stats, and your overall gateways to payment more closely, because you do not have enough data and stats there too.

Hope this helps.

As a buyer I would rather buy though paypal. Paypal does seem to favor the buyer.

Shocking! Now, I think I understand even more better why networking companies such as Empower Network do not recommend paypal as main payment processor. There has to be some problems within paypal for sure. and its staff need to work it out.

While, I think, it's just about how you sell your staff.

I have seen this happen personally and find it to be accurate.

Most people use paypal because it's easy and convenient. Although, I use paypal, and several other merchant accounts. Interesting statistics - thanks for sharing.

We actually use PayPal for our Merchant Account.
Their Payflow gateway.
https://www.paypal.com/webapps/mpp/p...ayment-gateway