Over $2,076,184 in annualized revenue lost when removing PayPal as a payment method.

Why you should be extremely hesitant to just remove PayPal…

Problem:

<aside> <img src="/icons/report_red.svg" alt="/icons/report_red.svg" width="40px" /> Indicate the customer’s challenge.

This is more of a merchant challenge then anything related to their customers. PayPal is a bitch (let’s just call it what it is) to deal with. PayPal is a major point of frustration for merchants with it’s negative impact on cash flow, chargebacks, and additional fees.

This has many merchants questioning whether they should even offer PayPal.

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Solution:

<aside> <img src="/icons/checkmark_green.svg" alt="/icons/checkmark_green.svg" width="40px" /> Highlight our hypothesis or how we solved the problem.

It’s pretty simple really; we don’t know the impact of PayPal til it’s gone. So like any significant change we tested it.

We believed that removing PayPal would be detrimental to the conversion rate and have a significant impact on revenue.

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Results/Takeaways:

<aside> <img src="/icons/chart-line_blue.svg" alt="/icons/chart-line_blue.svg" width="40px" /> Show the results. Reveal how the customer experience improved.

Over 17 days and 20,612 sessions we saw the following results from hiding PayPal as a payment method:

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Revenue Per Session decreased by 12.25% 😱 Conversion Rate decreased by 3.53%

Overall revenue decreased by $96,699 during the test. 👈 That change annualized would result in a $2,076,184 decrease in ecommerce revenue.

<aside> <img src="/icons/info-alternate_blue.svg" alt="/icons/info-alternate_blue.svg" width="40px" /> Don’t believe it see the real numbers below…

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What did we learn from this test?

How has our understanding of their customer evolved as a result? Summarize each insight we discovered as a result of this test.

<aside> <img src="/icons/info-alternate_red.svg" alt="/icons/info-alternate_red.svg" width="40px" /> Removing PayPal has a very negative effect on revenue.

Even though PayPal only accounts for ~14% of orders the safety it seems to provide users is worth far more than the fees/revenue associated with it.

In the past year we estimate PayPal fees to be ~$96,000 (assuming 2.9% + $.30/order).

Based on the performance of this test, removing PayPal would decrease revenue by $2.07million.

Now that’s what we call mitigated risk. This is why you test. 😮‍💨

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