Crowdtesting is the key to smooth digital payments

Thanks to Covid-19, businesses have been forced to make decades’ worth of digital change within a matter of months to keep up with the shifting needs of consumers, who are now spending more time online than ever before.

Google’s e-Conomy SEA Report 2020 noted that the pandemic led to Southeast Asian users spending, on average, an additional hour online while in lockdown in order to access necessities, as well as entertainment and remote work solutions.

But the pandemic has had a particularly tangible effect on the retail sector, says Zebulon Winzenried, senior manager of testing services at digital quality testing platform Applause. Online transaction values have spiked thanks to government-sanctioned lockdowns, and revenues have risen for restaurants and fitness studios, which have moved their businesses and payment infrastructures online.

Concerns about hygiene and social distancing measures have also caused consumers to ditch cash in favor of contactless card transactions or digital alternatives like mobile wallets. South Korea, for example, has adopted a largely cashless economy, leading companies like Starbucks to eliminate cash options in-store.

For customers, digital payments offer greater convenience and flexibility, Winzenried says. On the other side of the coin, companies benefit by being able to capture more sales and boost their revenue streams.

Zebulon Winzenried, senior manager of testing services at Applause / Photo credit: Applause

“Giving customers the ability to set up automatic payments and renewals improves recurring revenue and reduces churn while saving time over manual payment processing,” he says.

The hidden complexity of payments frameworks

Despite the obvious benefits, a lot of complexity goes into building and maintaining the underlying network that allows people to pay with a swipe of a card or by tapping a few buttons on their smartphones.

In brick-and-mortar shops, retailers rely on point-of-sale terminals equipped with near-field communication technology to enable contactless payments with cards or digital wallets like Apple Pay or PayPal. Meanwhile, ecommerce platforms have to integrate with an ecosystem of payment operators such as Stripe, Square, or Razorpay.

“The payment processing ecosystem has a lot of moving parts and different technologies operating together,” says Winzenried. “Everything from apps to hardware to application programming interfaces needs to function properly for the payment to go smoothly.”

This journey is crucial to ensuring great user experiences, which are becoming more important as the internet economy matures. Poor payment experiences due to a lack of options or bad interfaces can have a concrete effect on a company’s revenue, leading some customers to abandon their purchases altogether.

That was exactly what was happening to one of Applause’s clients in Brazil. After experiencing high rates of cart abandonment, it implemented Applause’s digital quality crowdtesting solution – which creates a test environment that most closely mirrors the way digital properties will be used in real life – and found that debit cards were being declined as a payment option on its platform.

“As Brazil is a cash-based economy and doesn’t rely on credit, this customer was losing out on revenue,” Winzenried says. “[The company was] able to take this information to its processor, who had inadvertently blocked all [Brazilian] debit bank identification number ranges from purchasing.”

This incident shows how offering more digital payment solutions to customers may have unintended side effects. “It complicates the existing system by introducing more variables and complexities,” says Winzenried. “The potential for things to go wrong increases, which highlights the need for companies to deliver high quality digital experiences that customers demand.”

Specific issues like these arise partially due to the diversity of the Latin American region, something Southeast Asia is familiar with as well. Companies in Southeast Asia can expect similar and unique challenges as its digital payments ecosystem goes through growing pains over the next few years.

But that’s not to say that more mature markets like South Korea – where digital payment methods such as Naver Pay, KakaoPay, and Payco account for over 30% of digital transactions in 2019 – don’t have these problems. Applause has some experience in the country, having helped ecommerce provider Digital River to seamlessly process transactions by leveraging digital payment channels.

Figuring out what you don’t know

At its core, quality testing of digital products is all about ensuring customers receive excellent digital experiences – it’s the bridge between the needs of the everyday internet user and the developer on the other side of the screen.

The testing process is crucial to the product development life cycle as it allows product owners and developers to know that their technologies are working as designed and, in the event they are not, where something has gone wrong.

Photo credit: Applause

“Companies tend to overlook problem areas because they don’t know what they don’t know,” Winzenried says, adding that testing can also reveal the answers to undiscovered questions. “Does it work easily, intuitively, in the ways users expect? Does it integrate with other tools, work on different devices or networks? Answers to these questions are critical for brands who want to engage with their customers.”

For example, when desktop users tried to check out using the service of one payments firm in India, the action would launch multiple windows. When Applause tested the mobile web experience for this client later on, it also learned that the platform – on Android devices – had buttons that were completely cut off and unclickable. Not exactly the ideal user experience.

By conducting quality crowdtesting, companies can simplify their product development processes and get detailed insights into where their customers may be experiencing pain points. Even a simple word change – using “checkout” instead of “proceed” – has an effect on a customer’s decision to abandon their carts or not, says Winzenried.

Essential for expansion

As companies look to expand into foreign markets and scale their businesses, testing will become even more crucial because of the cultural or infrastructural differences and the complexities of cross-border regulations they may encounter.

“Testing payment solutions is key to expansion, as it supports the verification of new and existing payment methods, along with garnering user feedback,” Winzenried says. If businesses ignore the latest developments and trends in payments, they may lose out on potential wins in their new markets, he adds.

Take Western Union, for example. The remittances giant had plans to expand its services into the digital space – a transition that posed not just technical challenges but regulatory ones as well. As an established financial institution, Western Union is legally required to carry out verification processes on all transactions, and laws may be even more stringent when it comes to digital transfers.

Applause helped by leveraging its global network of digital experts to use Western Union’s services. 2,562 transactions in 87 countries were tested over the course of 12 months in order to suss out where problems were taking place and to make sure that Western Union achieved the country coverage it needed for compliance.

In one specific test case, the results showed that 31% of testers encountered challenges in completing online transactions, highlighting the areas that needed to be reevaluated before the product could go live.

Crowdtesting will also be paramount for those looking to scale into developing regions like Latin America and Southeast Asia, where the economies are rapidly growing and digital infrastructures are still maturing.

In Latin America, for example, the digital payments infrastructure is fairly nascent, though payment providers like Mercado Pago are working to adjust to the digital needs of their local users. Many still rely on the Boleto Bancario payment method, an offline-meets-online system that allows customers to place online orders and, at checkout, print a digitally generated invoice that can be paid off with cash at designated convenience stores or ATMs.

The prevalence of the Boleto system suggests that there are certain pain points that can be resolved with the right payment technologies – though precisely what and where those pain points are can only be determined through testing and culturally responsive product development.

“Businesses in [Latin America and Southeast Asia] can learn a great deal from other markets about providing seamless transactions, ensuring they’re accepting the types of payment instruments their customers prefer or that currencies are localized correctly,” Winzenried says.

“A bad user experience on an app or the web can lead to loss of confidence in a product or company. With so many competitors in the money sending space, those losses can really add up.”

Applause is a leader in crowdtesting and digital quality, helping leading companies deliver quality digital experiences that customers love.
Find out more about how it can help your organization with its digital payment testing needs on its website.

This content was produced by Tech in Asia Studios, which connects brands with Asia’s tech community. Learn more about partnering with Tech in Asia Studios.