With the holiday season around the corner (Black Friday already?), payment downtime and its associated financial losses and negative impact on customer relations, are the scariest scenarios for online merchants. But don’t worry, there are ways to minimise it significantly.
Like the retail industry as a whole, the holiday shopping season is continuously evolving. Americans start holiday shopping in October and continue throughout November and December. In recent years, especially in parts of Europe, preparations for the holiday season can start as early as July. New events such as “Black Friday in July” encourage consumers to spend and to buy gifts in advance.
Online retailers always fear payment processing downtime, especially during Black Friday and other seasonal peaks. For lots of online businesses, the holiday period is the crucial revenue generator, growing sales in hundreds of percentages a day, compared to a regular day of the year. Along with the expectation and the enthusiasm of merchants, there are also a number of concerns. The momentum can stall for all sorts of reasons that can’t be controlled. Payment downtime is one of them.
2019 saw several gateway downtimes which have caused damages mainly to small business and to startups that usually use one payment provider and not several, like large well-established companies do.
Two years ago, we conducted telephone interviews with 200 CFOs, VPs of Finance and Payment Controllers with some of the biggest names in the European Retail, Travel, Digital, and Gaming sectors. The survey conducted in partnership with Worldwide Business Research company.
A mid-sized chain of retail outlets has been estimated by some to lose around 3,000 euros per minute when payment services go down. At that rate, losses from payment service interruptions mount up very quickly. Most enterprises (around 72%) admitted to financial losses ranging from 10,000 euros to around 100,000 euros. An unfortunate 11% lost up to a million euros, or more.
76% of survey respondents experienced at least one complete outage in their payment services and 42% experienced six or more partial outages. The bulk of cases (around 88%) took anywhere from a few minutes to a few hours to solve. Let’s do the math: 3,000 euros per minute revenue loss!
Peak time outage can be a cause for collateral damage to a business, hence special care must be taken during high traffic times. More than a third of merchants interviewed in our survey have seen their services go down during peak times.
There are four main concerns of merchants regarding downtime:
- Shaken customer confidence in reorders
- The capacity and energy for dealing with complaints from customers
- Lost revenue, especially in peak seasons and holidays
- Long-lasting damage to reputation
How to minimise payments downtime?
Gabi Malayev, NOC (Network Operation Centre) Team Leader at SafeCharge explains:
“When searching for a payment partner, merchants must be aware that outages may happen, a merchant should do comparison shopping and choose a payment partner with a proven track record of high uptime, fast response, zero downtime during maintenance and 24/7 support”.
1. Understand the importance of the digits in uptime
100% uptime cannot be achieved by any system and it is impossible for servers to guarantee zero downtime.
There is a big difference between service providers that offer service uptime levels of four nines, five nines or in some truly rare cases, six nines. Every digit in the uptime percentage is importantand makes a big difference to businesses.
The chart on the left depicts how a single digit difference is reflected in service uptime.
2. Find a service provider with a proven track record of high uptime
One of the most effective ways to maintain uptime is to adopt the use of two or more full capacity data centres. These back up centres, along with advanced technology, keep systems updated and uptime monitored even during the peak and high traffic seasons of the year.
3. Insist on zero downtime due to maintenance
Downtime due to maintenance should be unacceptable for merchants. Any reliable payment service provider should be able to maintain its infrastructure without causing system downtime that affects its customers. They can do this by using either backup servers or an ‘Always-on’ approach.
4. Ensure that you have 24/7 support
System failures may occur, but what is crucial for your business is an instant response by the service provider. A round-the-clock support system ensures that the issues are reported and fixed right away, drastically minimising or stopping any possible downtime.
For SafeCharge’s (free) full survey click here.
As always, feel free to contact us for more information.
We wish you a blessed and fruitful holiday season!