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Support Services: A Lifecycle Strategy Encourages a Lifetime of Consumer Payments

1 Sep, 2008 By: Response Contributor Response

Consumers, like never before, are in control. They choose their brands. They determine when and how they will receive messages about your products and services. What's more, consumers today transact with forms of payment that didn't exist 10 years ago. They've created digital-only brands, which contend with brands that are decades established.

 Jason Pavona
Jason Pavona

Powered by the Internet and unprecedented access to content, the digitally empowered buyer consumes news, television, radio and even mail on-demand, while religiously filtering unwanted messages and merchandising. The best, often most loyal and profitable, of these consumers are multichannel and marketers must be too.

These changing dynamics are playing to the sweet spot historically held by direct response marketers. Direct sellers are obsessed with a keen understanding that it's about making the product relevant to the consumer here and now. Given its informative, educational and often entertaining approach to demonstrating products and services, the industry has adapted well to capture shifts in consumer appetite for media. Today, direct response sells not only through short- and long-form media, but also through the Internet and through targeted in-store strategies.

Measuring the Back End First

Managing these shifts is not without change in how business is done. Direct response sellers — regardless of product, service or media channel — have been smart to conform their businesses to the real-time needs of their consumers. They are actively bringing lifecycle business strategies to their entire service and fulfillment platforms. Business processes that were once viewed only in their own operational context are now viewed as one step in a series of business process cycles that depend on one another to optimize the customer experience and to enhance the lifetime value of each customer.

Order management, fulfillment and customer service, and many formerly-price-driven commodities, are now viewed and measured first in the spectrum of their ability to create competitive differentiation and to increase lifetime customer value. This approach also has extended to a commodity often looked at through a functional, lowest-cost lens — payment processing.

Your processing relationship today is increasingly less about size, scope and seemingly low cost. It's about the relevance of your provider's solutions as looked at from your needs — the products and services you sell, the media through which you sell them and the ability of your processor to live and breathe the experience of your business and ultimately the needs of your consumer.

Achieve the Right Goals

Looking at the macro picture, today's payment engine should help you achieve three goals. First, your payment engine should be a pivotal part of your revenue growth strategy — reducing declined authorizations, improving re-authorization success rates, lowering your percentage of refunds, increasing adoption of service differentiators including alternative payments and international payments. Second, it should help you minimize processing and payment-related costs by helping you manage interchange, reduce chargebacks and automatically update customer payment information. Finally, your payment engine should be included in all efforts to streamline operations as they relate to all other business cycles — helping you simplify connectivity, eliminate cost- and time-consuming gateways, develop clear, concise and flexible online reports, and automate processes such as chargebacks.

The more holistic look it takes at the lifecycle of payments, the more consultative your payment processor will be. Developing the micro applications to achieve the three stated goals is where processing becomes a strategic asset in your supply chain.

For example, understanding the interplay of authorizations or chargebacks and BIN analytics, or the relevance of alternative payments to your customers — before undertaking the development expense associated with them — is the difference between value-adding processing services and the status quo. Take the time to evaluate the people behind your payments, to make sure their goals are aligned, and to examine closely how each payment you process can be optimized. Doing so can enhance the real value of payments made by your consumers and their lifetime value to you.

Jason Pavona is vice president of product management for Massachusetts-based Litle & Co., a leading card and alternative payments transaction processor and merchant services provider for card-not-present commerce. He can be reached via E-mail at

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