August 4, 2015 - WRITTEN BY GEORGE WANG
Online ordering is becoming more and more popular with business owners, but there are definitely potential pitfalls that businesses need to be aware of. Below are three situations based on actual problems our clients encountered, and our explanations of how we helped our clients fix them.
Scenario: Insecure Restaurant set up a website where customers could enter in their credit card information online during checkout. But in order to save money on the credit card processing, instead of processing the payment online, the credit card number was sent to the store via email, where waiters would input the credit card information manually in order to charge the customer.
Why This Is Bad: By sending secure credit card numbers through email, the information can be intercepted by third-parties or hackers. Insecure Restaurant is leaving themselves open to lawsuits, significant fines for violating PCI compliance rules, negative publicity, the cost of ongoing credit monitoring for affected customers, and increased insurance and credit card rates.
What We Did: We replaced Insecure Restaurant's checkout process completely with a PCI compliant process. Secure Restaurant now gives customers the option to pay online through a secure intermediary, so that nobody (including Kaidoora) sees the credit card information. In addition, customers are given the opportunity to pay in-store (for pickup orders) or via a portable credit card swiper (for delivery orders), giving Secure Restaurant the benefit of lower credit card processing rates without the cyber-security violations.
Scenario: In general, the lower the risk of fraud, the lower a business's credit card processing rates will be. To minimize their credit card rates, Casual Eatery used an ecommerce setup designed for a furniture store. They set up a 10-step online checkout form that asked the customer to first create an account, and then input (among other things) their name, home address, mailing address, daytime phone number, nighttime phone number, and fax number.
Why This Is Bad: Very few orders came through Casual Eatery's website. In conversations with Casual Eatery's patrons, we learned that some abandoned the online ordering process because they didn't want to fill out a complicated form, while others didn't understand why Casual Eatery needed to know their home address for a pickup order.
What We Did: We simplified Casual Eatery's checkout process so it only prompts customers for the necessary information needed to complete an order. Customers are not prompted for their credit card information unless they elect to pay online, nor are they asked for their address unless they order delivery. Other irrelevant fields (e.g. fax) were eliminated entirely. Casual Eatery is still paying comparable credit card processing rates, but their online sales volume increased by over 1,300%.
Scenario: Successful Restaurant used Eat24, Grubhub, OrderAhead, and other similar services to successfully generate online orders through their website. Although they had to increase their prices and reduce their portion size to accommodate the commissions, they saw an increase in their revenue. However, when analyzing how frequently these customers make return trips, Successful Restaurant realized that customers on these platforms returned much less frequently than expected, as compared to customers that they marketed to via different sales channels.
Why This Is Bad: Repeat business was very important to Successful Restaurant. They were willing to pay an 18% commission for new customers, but they expected these customers to return more frequently, and they didn't.
What We Did: We encouraged Successful Restaurant to use our website services in conjunction with their existing online ordering services. Now, when new customers come from these platforms, Successful Restaurant encourages them to make future purchases through the Successful Restaurant website. This reduction in costs allowed Successful Restaurant to offer their existing loyalty program to more customers, and Successful Restaurant now has access to additional emails and customer addresses for their future marketing.