1.9 Payment Processing Options
Transaction is the most important aspect of any website that sells a product. What payment options do you provide to your customer on your website? Are these options secure and reliable? Payments with credit card are the fastest and the most efficient form of a transaction on a website. You should incorporate a payment system that accepts all major credit cards. After all, you wouldn’t want to lose a sale just because you do not accept a certain credit card.
There are certain key aspects of allowing payments with credit cards. However, the most vital aspect of the complete transaction process is security and authentication of the transactions on your website.
Let us first understand the whole process that takes place during an online payment transaction. Key participants of an online payment transaction are:
• The Customer
• The Issuer – the Bank that issues a credit card to your customer
• The Merchant – you in this case
• The Acquirer – the financial institution that provides authorization to the merchant (you) that a given card account is active and that the proposed purchase does not exceed the customer's credit limit
• The Payment Gateway – the system that processes merchant payments by providing an interface between the merchant and the acquirer's financial processing system
The basic steps of an online payment transaction should include the following:
• The customer places an order online by selecting eBook(s) from your web site and stores it in a Shopping cart. These shopping carts are provided by payment gateway systems, which are discussed later. Once the order is complete, he/she proceeds to checkout and make payment for the eBook(s). The customer order is then sent to you, including payment data. The payment information is encrypted by an SSL pipeline set up between the customer's web browser and your web server, using an SSL certificate. Security certificates and encryption is discussed in more detail later.
• You would then request payment authorization from the payment gateway, which routes the request to banks and payment processors. Authorization is a request to charge a cardholder, and must be settled for the cardholder's account to be charged. This ensures that the payment is approved by the issuer, and guarantees that you will be paid for your service or product. This process first requires that you set up a merchant account for accepting credit cards online. Your third party payment service would take care of this.
• Once you are guaranteed that the payment is approved, you should confirm the order and supply the eBook through your preferred method of delivery (Instant download, Email, CD-ROM).
• Transactions are settled, or routed by the acquiring bank to your acquiring bank for deposit.
1.9.1 Merchant account for credit cards
For Merchant account set up you should always look for an e-commerce service and payment processing company that can integrate your merchant account needs with your payment processing, hosting, and shopping cart requirements. Integrated solutions mean you keep your infrastructure tight and your customer service centralized.
A merchant account enables you to begin accepting credit card payments over the Internet. It's a 'liaison' account linking your customer's credit card account with your own business account, functioning as a clearinghouse for credit card transactions. Sounds simple right? So what's the first critical error many online businesspeople make? They assume that all merchant accounts are alike.
Of course, this faulty assumption has led to much frustration - and more than one website crisis. Building a sound business foundation means finding the best merchant account for your business model and for the types of goods you sell. Though the rates of some service providers can be quite high, many of the cheaper solutions will end up costing you more in terms of poor service, inflexible limits, technical difficulties, or inept customer care. The key is finding the right balance.
First, competitive rates and reasonable fees are important, so make sure you do some rate comparison. Look at the transaction fees charged for every transaction performed online. Many services provide discount rates for every online sale you transact. This is something you should consider while choosing the right payment processing and merchant account setup service.
Some merchant account providers will charge you a fee for every charge back you incur. If your business typically receives a disproportionately high amount of charge backs, then charge back fees can hit you hard.
Another important aspect while selecting your service provider is the kind of Customer Service it provides. Communication is critical. Make sure your merchant account provider has the customer care platform to swiftly and reliably answer questions and resolve problems.
Remember, rates and fees are simply a part of the big picture. Getting a wider perspective on initially intangible items like sensible policies and superior customer service is essential in choosing the best provider for your unique business needs. Look for the details that distinguish one provider from the next.
Payment Gateways
There are many third party payment services that completely automate the whole process of online payment transaction. The most popular and trusted services are listed below.
ClickBank (http://www.clickbank.com)
ClickBank is one of the most popular and easiest services to use for payment processing online. Sign-up is quick and you get approved and running in one day.
The ClickBank Control Panel is easy to use. You can get familiar with the whole system in no time. It costs $49 to open a ClickBank account. This is pretty cheap when compared with other payment processing systems.
Also, ClickBank has a built-in affiliate program. No need to install any expensive scripts on your website. You can start signing up affiliates right away as soon as you open your account.
Once you open an account, all your transaction money gets deposited into your account.
You are paid the full balance every two weeks.
VeriSign – (http://www.verisign.com)
VeriSign Payment Services provide payment connectivity over the Internet between online customers, merchants, buyers, sellers, and the financial networks that move money between them. VeriSign is easy-to-use, secure and cost-effective.
VeriSign offers a host of solutions for online payment processing. These are:
Payflow Pro – This is the most basic form of online payment system that allows you to accept payments on the Internet. Payflow Pro gives you immediate connectivity to all major payment processors and is integrated with all major shopping cart software. Payflow Pro has a set up fee of $249 and a monthly fee of $59.95.
Payflow Link – This service also allows you to accept payment in the form of credit card and debit card on the Internet. Payflow Link works with all major shopping cart software. Payflow Link has a set up fee of $179 and a monthly fee of $19.95
Payflow Recurring Billing – This solution allows you to automatically bill your customers on a regularly scheduled basis through this convenient service. Payflow Recurring Billing is integrated with Payflow Pro and Payflow Link. Payflow Link with Recurring Bill has a set up fee of $193.95 and a monthly fee of $29.90 whereas Payflow Pro with Recurring Bill has a set up fee of $288.95 and a monthly fee of $89.90
Commerce Site Services – This package includes authenticating your online business, encrypting sensitive data with an SSL Certificate, and securely processing payments with any of the above online payment solutions. This package costs around $900.
PayPal – (http://www.paypal.com)
PayPal is an account-based system that lets anyone with an email address securely send and receive online payments using their credit card or bank account. There are two types of accounts.
Personal Account (Buyer Account) - Personal accounts are for individual use only
Premier/Business Account (Customer Account) - Premier and Business accounts include premium features, such as the ability to accept credit card payments and use the PayPal Shopping Cart.
PayPal charges Premier and Business accounts to receive payments. Personal accounts are free, but may not receive credit card payments. There is no set up fee and monthly fee for receiving payments with Premier and Business accounts. However, you are charged a certain percentage for every transaction.
Apart from credit cards, you may also allow customers to mail a check for payment. However, such forms of payment consume a lot of time to process and are not as reliable as online payments. You may have to wait for ages before getting your check in the mail.
iBill
iBill (http://www.ibill.com) has a wide range of services, including check processing and support for service-based billing, which makes it a very good solution for businesses, big and small, who want to add billing and credit-card authorization services to their websites.
iBill offers a wide range of plans. These plans range from an authorization service for companies with existing e-commerce sites (the Basic TP plan) to a catalog-sales plan for companies that have no back-end billing or shopping-cart mechanisms in place (the Catalog TP Plan). For the Basic TP plan, the fee is 25 cents per transaction, with a one- time setup fee of $149 and a minimum monthly maintenance fee of $50. The fee for the Catalog TP plan is $1 per transaction, with a one-time fee of $149 and a minimum monthly fee of $50.
Apart from these, iBill also has a reseller subscription service, which is targeted at subscription websites with recurring billing. The Subscription Sales TP service sets up iBill to handle back-end transactions for the purchase of content or services on a one-time or recurring basis, where a user is sent directly to an iBill secure Web page for payment processing. The user is then given a username and password for future transactions. The fee for this service is based on a sliding scale as a percentage of your billable.
In addition, there are two billing options that are unrelated to credit cards. The Web900 program charges customers via their phone bill; the charge appears as a 900-number charge, without the use of a credit card. The other service allows you to accept checks online, where the customer passes along his/her account information and iBill electronically transfers the funds from the account. However, the transaction fee for these services is quite high ranging from 15% to 35% per transaction.
1.10 Security Certification and Encryption
As discussed earlier, the most vital aspect of a sound payment processing system is security and authentication of all transactions on your website. A customer needs to have complete faith in the security infrastructure of your payment processing system.
The most trusted technology for ensuring a highly secure transaction is by implementing Digital signatures via web server certificates that enable authentication and SSL (Secure Sockets Layer) encryption. SSL web server certificates lead to a secure online payment management system, to allow your e-commerce web site to securely and automatically accept, process, and manage payments online. SSL comes in two strengths, 40-bit and 128-bit. 128-bit SSL encryption is the world's strongest form of commercial encryption, and hence the safest. Your customers should be very comfortable with a 128-bit SSL encryption. The 128-bit SSL encryption is what all payment processing companies make use of these days.
SSL server certificates fulfill two necessary functions to establish trust for online payment:
SSL server authentication -- Server certificates allow customers to confirm a web server's identity.
SSL encryption -- SSL server certificates establish a secure channel that encrypts all information sent between a customer’s web browser and your web server, protecting private information from interception over the Internet.
Only after you have built a web site and implemented SSL certificates to authenticate your business to customers and encrypt communications and transactions, you can address other crucial components of the payment processing system.
1.11 Setting up your download page
We saw earlier various methods of delivery in case of eBooks. The most popular method by far is allowing your customers to instantly download the eBook. However, many websites lose out on creating an effective download page. There should be clear download instructions. In case of information download, it is crucial that you show a download bar and the download status. Many websites offer huge eBooks for download but while the user is downloading he/she has no idea of the status of the download or the speed of the download. This is very frustrating especially in the case of larger eBooks. Your website should also state the size of the file in kilobytes and the estimated time of download for a user having a 56K modem, DSL, Cable and so on.
The download page is often a soft target for hackers. This page holds confidential information about your customer’s credit card. Thus, it becomes essential that you take every step to protect your downloads.
As a general rule of thumb, here are the different elements you should include:
• A 'thank you' message to the customer for buying your eBook.
• Display the e-mail address that customers can use to contact you if they have questions or problems. Make sure to display the address fully (as opposed to using a clickable image or 'click here' link).
• Remind the customer how the transaction will appear on their credit-card statement. For example, if you're using ClickBank, the credit-card statement will show a charge by "CLICKBANK / KEYNETICS"
• Explain how to download and begin using the eBook. If there are special software requirements like WinZip, Internet Explorer 4.0 or Acrobat Reader, be sure to point this out and include links to the appropriate websites.
• Give customers a link to go elsewhere after they've downloaded. This is a good place to promote other eBooks or encourage customers to sign up to your newsletter.
• Keep the download page free of too many distractions. You've won a new customer. Treat that customer well by showing him/her how to immediately download their eBook.
1.11.1 A few other pointers
Offer compressed as well as uncompressed eBooks
You can compress your eBook file to make it smaller (in memory terms) using compression software like WinZip. You should offer both a compressed and an uncompressed version of your eBook on the download page. This will enable a quicker download for those customers who have WinZip and are familiar with it. By the same token, those who don't know about using WinZip have the option of downloading the larger file.
If you're offering both compressed and uncompressed versions, then you should link your customers to the WinZip website, and explain how to use WinZip to unzip (uncompress) your eBook file.
Scan for a virus
Don't risk spreading a virus to your customers through your eBook. Before you send it online for others to download, it's imperative that you run a virus-scan on it. Make sure that you use an up-to-date virus scanning software. If you don't have one, then send a copy of your book to a friend who does.
Upload the files using FTP
It is always best to upload all your files to your website server with an FTP tool. This is an efficient and quicker process as compared to other traditional approaches. For better management create sub-directories on your website using the FTP tool. Upload related eBooks in each sub-directory.
Once you do this, simply place the complete link for these eBooks on your website for your customers. Make sure that you place two links for compressed and uncompressed files.
Downloading PDF files
The download process for PDF files works differently compared to other formats. If your customer directly clicks on the link provided for the PDF file, the book will open inside the customer’s browser. From here, the customer can click the save button and save the file to his/her PC.
However, this approach is not recommended as there is no indication of how big the file is and how long it would take to download the file. Besides, it can take a long time for the eBook to open in the browser.
To get around this problem, you should always instruct your customers to right click on the link and then click on “Save Target as”. This makes downloading a PDF file similar to all other files in the sense that a window would open on the customer’s screen asking him/her to save the file at a specific location. This would indicate the file size and the time for download.
Be sure to remind your customers that they'll need a copy of Adobe's Acrobat reader to view the eBook and let them know that they can download a free copy from the Adobe website.
Test your links
Always test the download link to ensure that everything works as it should. Get some of your friends to try it out on their PCs. If nothing happens when you click on the link, check out the code for the link as well as the directory where you have saved the eBooks. Testing is a very important phase of setting up the download page.
1.11.2 Protect your downloads – Protect your Income
Digital theft is very prevalent these days. The main reason for this is that it is extremely easy to download a product illegally, unless it is protected well. The good news is that it only requires a few simple steps to ensure protection of your downloads. These are listed below.
Zip your PDF eBooks
The biggest problem arises when sellers store their downloads as PDF documents, as is the case for eBooks. You would know that Google, Altavista and many other search engines can read and list PDF files.
Besides, Google also converts your PDF files into HTML documents. So ordinary browsers not only have access to your PDF file, but they can download your Source File as well. The next logical step is for them to customize it with their own links, compile it and sell it or give it away.
A simple way of keeping your files out of the reach of spiders is to upload them as a zip file. Search engines cannot look inside zip files and list their contents.
Create an Index.html file
You must have an index.html file in EVERY folder. It acts like a curtain that keeps your eBooks away from prying eyes. A folder without an index file is like a house without walls. Everyone can enter and help themselves to the valuables.
The 'index.htm' file is the default file that opens when you click on a link for the eBook. If you don't create an index.htm or index.html file, you'd be allowing everyone to directly access the root directory of the folder where you store your downloads. All eBooks stored in a folder without an Index.html file may be visible and ready to download without authorization.
Use Simple Scripts
You can use a simple script to redirect prying eyes back to your home page. Here's the easiest way to do it using what it called a "meta refresh tag." Add it between the Header tags like this.
<head>
<META HTTP-EQUIV="refresh" content="0;URL=http://yoururl.com">
</head>
Just paste this code into the head of your document (before your text).
Spider-proof your download page
To prevent search engine spiders from reading and listing the download pages that link to your eBooks add the tag below in the head of the document.
This "Robot" tag tells the spider that this page is not to be spidered or indexed. As a result it should never show up on a search.
<head>
<META NAME="ROBOTS" CONTENT="NOINDEX, NOFOLLOW">
</head>
Frequently change your download links
To prevent unscrupulous people from posting your download links on forums or message boards, change the folder or file name where you store them from time to time, even if it means having to change the download links in your merchant account.
Using these methods will give you a good degree of satisfaction, knowing that you have taken the most basic steps to protect your eBooks - and at absolutely no cost to you.
1.12 Setting up Customer Support and Services
In order to develop a good relationship with your customers, you must provide them with quality customer service. Let them know that, should they have any questions or problems, they are free to contact you. Provide them with all of your contact information to make the process simple. Even if you can't personally assist them, make sure that you have a good customer support group ready to help. Reply to their support requests as quickly as possible and assist them until the problem is resolved.
Customer service is one of the most important factors in determining your customer's satisfaction. Even if you have great eBooks, if your customer support isn't good, your sales will suffer. Good customer service is perhaps the most important way to build your credibility with the customer. When you are doing your entire business online, building trust and credibility is the most important factor. Prompt customer service can make the difference.
For every dissatisfied customer, you can expect to lose one hundred new customers. Why? When one customer has a bad experience with your company, you can be certain that they'll tell everyone they know about their bad experience. It will travel through the grapevine and ultimately cost you sales.
Follow-up with your customers and ask them how they like your eBooks or if they have any questions. This is a great way to not only provide good customer service, but to also obtain feedback about your eBooks. By listening to your customers, you will know exactly what they want, what they're having problems with and how you can develop a better eBook. This would help immensely in updating your eBooks for better sales.
By following up with your customers and providing great customer service, you are creating a life-long relationship. Satisfied customers are more apt to purchase your new eBooks in the future. Treat them with the utmost respect and go above and beyond the expected.
Your customer and support service should include:
• Email support that is quick and efficient
• Online chat support
• If you have a large website with a high number of eBooks, it might be a good idea to have a 24 hour toll free number.
Before the clients purchase anything from you they will probably ask a few questions regarding any concerns they have about your eBooks.
During the first few weeks of business you will experience similar questions constantly resurfacing. You would be fairly well advised to put this regularly asked for information on your website in the form of an FAQ to reduce your administrative workload. Your interested parties will be happy to get the answers to their questions answered immediately; and you didn't even need to lift a finger.
1.13 Running your website on “Auto Pilot”
As with any online venture, credibility is vital to the success of your eBook business. It doesn't matter whether you're selling your own original titles or titles with resale rights, if you don't give off an aura of credibility and reliability, your business will suffer.
The most important aspect that establishes credibility is your payment processing system. Not only does it have to be reliable and very secure, it has to be easy and quick for your customers as well. In recent times, many businesses have been completely automating their eBooks sales and delivery process. This not only saves a lot of time, effort, and money but it also maintains the credibility of your business.
We saw earlier the whole process and components of payment systems right from setting up a merchant account to establishing a secure payment gateway to installing a credit card authorization service. There are many services and tools available that incorporate all these processes into a single mechanism.
Until recently, no matter what type of e-commerce setup you opted to put in place, the one thing you were required to have was your own merchant account.
Setting up a merchant account can be tricky business. And if you're not careful it can also be expensive. Now, however, you can start selling online without the need for a merchant account.
In fact, not only can you begin selling without needing a merchant account, but also without needing shopping cart software, a secure payment gateway or a credit-card authorization service. This can be done thanks to the advent of order fulfillment services known as third-party processors. Verisign, Paypal, Clickbank, which we discussed earlier are a few examples of such third-party processors.
With these services, just about anybody can start selling online in no time at all, with a minimum of fuss and with no technical know-how whatsoever.
1.14 Third party processors
The principle of third-party processors is quite simple. The processor becomes the merchant (i.e. the business that is selling the product) and you become a supplier to the processor. Your customer pays the processor for the product and the processor in turn pays you for supplying the product. The processor charges you a percentage of the sales value for each transaction.
Because you're not selling the product directly to the customer you don't need a merchant account, credit-card authorization or a secure payment gateway. The processor takes care of all of this, because it's they who are making the sale.
In fact, all that you need to do to get set up, is place a simple hyperlink on your web page that the visitor clicks to order the eBook. This link will have your product information 'built into it' and will lead the customer to the secure payment gateway on the processor's server.
In the secure payment gateway the customer enters his/her credit-card details as usual. Once the payment has been authorized the customer is taken to your 'Thank You' page where he/she can download your eBook. Most processors will send you a confirmation e- mail every time you make a sale, and you can also go online and view sales reports for your eBook.
These services will also take care of refunding your customers if they're not happy with your product or if they dispute the purchase. In fact, they'll take care of just about every aspect of the selling process, leaving you time to get on with the altogether more satisfying job of promoting your business.
The processor takes a percentage of every sale made, and sends you pay-checks for your eBooks on a regular basis (usually every week, every two weeks or every month).
Thanks to this payment structure you can be sure that your e-commerce system is only costing you money when you make a sale and, instead of having hundreds or thousands of customers, you have just one -- your payment processor.
Such a service can completely automate your selling process. It is cost effective, safe, and can help immensely in improving your ROI. There is another aspect to putting your website on “Auto Pilot”. Once a payment is made, you can also automate the delivery process.
Automating the delivery process
On completion of the payment procedure through a third party service, you can automatically redirect the customer to the download or the “Thank You” page, where the link for the download is provided.
Once your customer clicks this link, the download process will begin. The customer's browser will open up a "save as" window which will allow them to save your file onto their computers. After the file is saved, you can either redirect the customer to the home page or any or promotional page.
It may be a good idea to send a thank you note as well as a confirmation of download through email with other account details to each customer. This process can also be automated with the use of autoresponders, which are discussed in the section on marketing the eBook.
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