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Merchant Services

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2017 report shows that with so much at stake, small businesses must adapt to changes in the ways customers shop and pay


Bank of America Merchant Services commissioned Forrester Consulting, one of the most influential research and advisory firms in the world, to conduct a study of payments-focused attitudes and behaviors among U.S. small business owners and consumers.


Merchant Services Factoid..gifTopics addressed in the inaugural Small Business Payments Spotlight include merchant and consumer sentiments towards point-of-sale and digital payments, cash, eCommerce, security and more.


Among the notable findings:

  • 48% of consumers carry less cash than they did five years ago, but 38% of small businesses have not changed the types of payments they accept in the past five years.
  • 53% of consumers are shopping online more than ever, yet only 44% of small businesses operate an eCommerce website.
  • Consumers aged 18 to 29 and over 65 are the most likely to never trust a small business again following a data breach affecting that merchant.


As the trusted payments provider for hundreds of thousands of small businesses across the U.S., Bank of America Merchant Services is pleased to share with you valuable insights in the Small Business Payments Spotlight.


Read the report (PDF) to explore what hundreds of small businesses and consumers have to say about payments today and tomorrow.

Your small business may offer great customer service, but how good is your customer experience? Rieva Lesonsky Headshot.png


Customer experience (or CX for short in the digital world) refers to the overall experience customers have with your business. Everything from your physical location to your salespeople’s attitudes to your website’s ease-of-use can enhance—or detract from—the customer experience.




Disney, Apple stores, Amazon and Zappos are among the leaders in providing exceptional customer experiences. Do you think your customers are happy with your customer experience? Don’t be so sure. Only 18 percent of companies in The Temkin Group’s most recent Customer Experience Rating study earned a “good” or “excellent” rating, down from 37 percent in 2015. And if your customer experience doesn’t rate at least “good,” the competition is going to eat your lunch.


Doubt the importance of all this? Maybe this will convince you: Research from NewVoiceMedia reveals businesses lose over $62 billion every year due to poor customer service. To avoid that happening to your company, join the 72 percent of businesses (according to data from Forrester) that plan to make “improving customer experience” their top priority.


Here are 5 tips to up your customer experience:


1. Offer multiple ways to interact with your business. Not all customers want to interact with your business in the same way. For example, older customers generally like to pick up the phone and talk to someone. Millennials might prefer to use text to resolve an issue or ask questions about a potential purchase. To create a good customer experience for everyone, you must provide multiple ways to interact with your business. This can include in-person, by phone, by email, via online chat, by text, on social media or going the self-service route with a knowledge base or FAQ section on your website.




2. Provide consistency. You may have an amazing e-commerce website that offers standout search, intuitive navigation and a seamless checkout process—but what happens when a customer comes into your store to return an online purchase? If he or she is met by a rude, irritable employee, or a salesperson who doesn’t know how to handle the return process and takes 20 minutes to complete the transaction, the wonderful customer experience on the website will vanish in an instant. Make sure your systems and processes work smoothly, no matter how or where your customer is interacting with your business. It’s also key to make sure that employees in all sales and support channels are equally well-versed in handling them.



3. Develop and train your people. You can’t deliver an outstanding customer experience without an outstanding team. Share your vision for the ideal customer experience with employees at all levels of the business. Make sure they understand it and are committed to delivering it. Provide ongoing training, feedback and development to ensure employees are playing their part in providing the best experience for your customers. Working with your employees isn’t a one-way street, however. Seek input from your team about how to improve the customer experience—after all, they’re the ones on the front lines interacting with customers. Empowering employees to make their own decisions (within guidelines you set) is vital, too. An employee who’s empowered to go above and beyond can transform a terrible customer experience into a happy one.


4. Understand your customers’ needs. Thanks to social media, digital loyalty programs and customer relationship management (CRM) software, it’s easier than ever to stay in touch with your customers and gain insights into their wants and needs. Use CRM tools and loyalty software to track your customers’ purchasing history and interactions with your business. Use social media to see what they’re interested in and how they interact with your competitors. Regularly conduct customer surveys, using online survey tools, email or social media, to see what customers think about your customer experience and how it can be improved. Using this information, you’ll be better able to personalize your customers’ interactions and even predict their behaviors so you can surprise and delight them with a tailored customer experience.


5. Focus on feelings. Creating a good customer experience is about more than facts and figures; it’s about how your business makes customers feel. Whether you sell jewelry to consumers or software to B2B buyers, think about the emotions you want your products and services to evoke in your customers, and work to ensure that every customer interaction creates those emotions. For instance, if you sell software to corporate clients, you might focus on how the software makes them and their employees more productive, so they aren’t as stressed, how it saves money compared to the competition and impresses their CFO; or how it boosts sales so they have the confidence to ask the boss for that promotion.


About Rieva Lesonsky

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog  A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.


Web: or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here


Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.


Bank of America, N.A. Member FDIC.  ©2017 Bank of America Corporation

Finding-the-right-credit-card-machine-Thumb2.gifIn our new guide, you can explore the types of credit card terminals available for small business. Use this overview to choose not only the best and most flexible option for your business, but one that will fit your needs perfectly today while preparing you for tomorrow.


Click here to download the guide "Finding the Right Credit Card Machine for Small Business" (PDF).

When it comes to cash flow management, accelerating the process can make a huge impact on your small business. Here are some technology-based solutions that can help you manage cash more effectively and keep your small business on track.


1. “Semi-Annual Small Business Index,” Rocket Lawyer, January 22, 2015


2. “Mobile Wallets: Strategies for Developed and Developing Markets 2014-2019,” Juniper Research, May 20, 2014


3. “Total Retail 2015: Retailers and the Age of Disruption,” PWC, February 2015


4. “U.S. Mobile Payments Forecast,” eMarketer, October 2015


5. “Digital Commerce Lifecycle Survey,” Avangate, June 23, 2015


6. “The Global E-Commerce Payments Guide,” Adyen, 2015


7. PricewaterhouseCoopers


8. “State of Remote Deposit Capture,” Bob Meara, Celent, January 10, 2014


9. “Calculate Your Savings,”


10. “Benchmarking the Accounting and Finance Function: 2014,” Financial Executives Research Foundation and Robert Half


Bank of America, N.A. engages with Publicis Hawkeye to provide informational materials for your discussion or review purposes only.
Publicis Hawkeye is a registered trademark, used pursuant to license. The third parties within articles are used under license from Publicis Hawkeye.
Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.
Bank of America, N.A. Member FDIC.
©2016 Bank of America Corporation
SBC Team

The Future of Credit Cards

Posted by SBC Team Oct 14, 2015

Credit-Cards-Thumb.pngThe credit card industry is not just undergoing a revolution; it’s facing an evolution. Help your small business prepare for tomorrow with the information found in our new guide, “The Future of Credit Cards.”


Click here to download the Future of Credit Cards Guide (PDF).







It’s all about the cash flow.  To help, we’ve compiled
our newest and most popular cash flow content for you. 
Click here.

POS_Body.jpgWith each news report of large-scale customer data breaches, small business owners have been left wondering how they can protect themselves and their customers from falling victim to credit card fraud. At the same time, they’re grappling with the implications of the upcoming migration to EMV technology on credit cards. By implementing strong security measures and preparing now for the October EMV deadline, small business owners can minimize security threats and ensure their on-time compliance with the new standard.


1. Introduction

For businesses in general and small companies in particular, customer relationships are built on trust. That’s why news reports about hackers exposing personal and financial data are so unsettling: from the customer’s perspective, that trust has been betrayed—and for the affected business, rebuilding that trust can be a painful, time-consuming process.


The last thing a company on a growth path needs is the combination of bad publicity, lost business, and lost staff hours caused by a data breach. While nothing can offer absolute protection against hackers, there are steps you can take to protect and preserve your company’s hard-won customer and vendor relationships, reputation, and prospects for sustained profitability and growth.


2. Taking care of business basics

The good news is that many security steps are easy to implement. That’s because most cyber criminals aren’t looking to exert themselves—they go after the low-hanging fruit, says Troy Leach, chief technology officer of the PCI (Payment Card Industry) Security Council, which promotes education and awareness of PCI security standards. During the past five to ten years, “the vast majority of vulnerabilities were actually very simplistic,” he says. “Somewhere between 92 and 99 percent of the breaches were known vulnerabilities that had been in existence for more than a year. We need to raise the bar and eliminate those simple things, and that will help move the needle on security.”


Passwords are one glaring example. Although in theory we all know better by now, Leach notes that the most common one in use is still “password.” If you can’t come up with something more difficult to crack than that, your password might as well be “welcomehackers.” But “probably the greatest human error element” is that many merchants don’t know where they have their cardholder data stored, he says. “Security equals the technology, the people, and the process they put in place to manage that technology.” As an extension of that thought, he notes that small businesses often store cardholder data that they don’t need to retain. If you don’t need it, don’t store it—and just like that, you’ll eliminate the risk of having that data breached.


Another common mistake among small business owners is to look for ways to economize on data security. This is not an area in which you want to rely on the services of your neighbor’s son, who is in his junior year as an IT major and has always been great with computers, Leach cautions. The same is true of your software, which should be secure, tested, and from a known and reliable vendor.

3. E-commerce and emerging trends

As you’ve probably noticed, some of your customers are using credit cards that are equipped with chips. To process chip payments, you need a chip-enabled terminal from your payment services provider, which can also help you to understand the steps you need to take to become chip-enabled. Your business is required to be ready for this migration by October, so if you haven’t started, do so now.


“Small and medium-sized merchants need to get informed. They need to do some research about what these changes are and how it’s going to affect them,” says Randy Vanderhoof, director of the EMV Migration Forum and executive director of the Smart Card Alliance. “Contact your bank, your processor, or whoever you have as your support for your payment device, and ask them about their ability to set you up for an EMV-capable terminal.”


When the new devices are delivered, he adds, “take the time to test them internally and learn about them before you turn the entire operation live, so that you have proper time to educate yourself and any employees about the changes at the terminal. Don’t create an environment where consumers are looking for your assistance to learn how to use their cards, and you are not familiar enough with the card or the technology to be able to complete the payment transaction.”


As that migration occurs, strong encryption will be more important than ever for businesses engaged in e-commerce. That’s because with the move to the EMV chip, “criminal activity is going to migrate to what is know as 'card-not-present' fraud—situations such as mail order, telephone order, and specifically, e-commerce, where the card is not physically presented by the customer,” Leach says. “So we need to be very diligent in recognizing that e-commerce merchants of any size are going to be a higher target for criminal activity very shortly. What they can do to protect themselves is find ways to encrypt that data immediately, as it’s received from their customers, in order to limit the access to that information.”


If you’re using a cloud storage service, he adds, make sure you know where your data is being stored and how it’s being protected. And he advises taking a long-term view on your investment in new terminals: “Do the cost-effective thing of future-proofing your terminals and looking at buying not only for EMV, but for point-to-point encryption. If you do that, you’re going to have a better chance of having a longer return on your investment in new terminals.”

4. Planning for the worst-case scenario

Of course, no matter how much you prepare, and no matter how good your firewalls and security are, you can’t make your small business invulnerable to hackers and malware. “The latest statistic I read was that more than 80,000 new variants of malware are introduced every single day, so it’s very hard to keep pace with that,” Leach says. “But a great defense is to continue to monitor and scan for vulnerabilities in your network.”


In addition, he advises business owners to create an incident response plan. “It doesn’t have to be complex. It just has to include the basics of who you contact. What’s your basic mode of operation? What are the procedures that you need to be aware of?” The plan should also include a list of website resources so you don’t have to search for those addresses when you need them. Depending on where your business is located, your home state may stipulate certain data breach requirements for notifying your customers, so it’s a good idea to be aware of those in advance, as well. “You’ll be in a much better position and less stressed by having all of these resources readily available, knowing where to turn, and who to seek advice from.”


Understanding the issues and developing best practices in cybersecurity can be challenging for small business owners who are not specialists in these areas. But by seeking expert advice and developing your company’s strategy for managing data, you can reduce your risk of a breach, protect your customer relationships, and prepare your company for a more secure and successful future.

5.  Resources

To learn more about cybersecurity, the upcoming EMV chip migration, and what your small business needs to do to meet its obligations to customers, consult these online resources.


Ten Cybersecurity Tips for Small Business is an online resource published by the Federal Communications Commission (FCC) to help small business owners “protect themselves, their customers, and their data.”


The FCC’s Small Biz Cyber Planner 2.0 is “an online resource to help small businesses create customized cybersecurity plans.”


This United States Computer Emergency Readiness Team page provides information you can use to learn more about cybersecurity and steps you can take to protect your small business.

Check StaySafeOnline, a resource of the National Cyber Security Alliance, for resources that can help you “protect your business, employees, and customers from online attacks, data loss, and other threats.”


The PCI (Payment Card Industry) Security Standards Council is “an open global forum, launched in 2006, that is responsible for the development, management, education, and awareness of the PCI Security Standards.” Its website includes a variety of resources developed specifically for small business merchants, including:


•    PCI for Small Merchants

•    Secure Passwords

•    Protecting Your Customer’s Data from Malware

•    Top Ten Tips for Protecting Against Card Fraud


The Smart Card Alliance, “a not-for-profit, multi-industry association working to stimulate the understanding, adoption, use, and widespread application of smart card technology,” created the EMV Connection website “to assist all industry stakeholders with EMV migration.” Its merchant page covers everything “from EMV basics to detailed guidance on what merchants need to consider to develop the roadmap to accept EMV cards and devices.”


The EMV Migration Forum and the Payments Security Task Force developed “to assist consumers, merchants, and issuers with the migration to chip technology.” Resources on the site include training FAQs, a training infographic, and a guide to communicating best practices, all available via links at the bottom of the merchant page.


Bank of America, N.A. engages with Inc. to provide informational materials for your discussion or review purposes only. Inc. is a registered trademark, used pursuant to license. The third parties within articles are used under license from Inc.. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

ExitStrategy.jpgWhether a business owner wants to retire to a tropical island or simply move on to the next venture, an exit plan is crucial to ensure a seamless sale. The business owner that plans wisely, in advance, can negotiate a transaction that benefits buyer and seller alike.


Barring unforeseen circumstances (injury, illness, family emergencies), it’s wise to plan for a sale at least one to three years in advance. Sellers should have at least three years of unblemished tax returns on hand, which will help an appraiser or broker accurately value the business and give the potential buyer a clear picture of a business’s cash flow. No one likes to pay taxes, but if you plan to sell a business, it’s best to think conservatively with deductions.

Click here to download the PDF.

Thumb.pngEMV chip card technology is here. It is crucial to plan a strategy before implementing EMV.


With EMV chip card technology, the card brands have introduced “liability shifts.” If your payment devices are not EMV enabled, your business could be held liable for counterfeit fraud losses when chip cards are used (card-present transactions only). We can help you understand the cost/benefit of adopting EMV.


Click here to read the guide, "Why You Should Adopt EMV Chip Card Technology" (PDF)


Here’s what you’ll learn:

  • How the majority of the world uses EMV
  • What the liability shift is and what it means to you
  • The impact on card issuers and merchants
  • What EMV means to your customers
  • Why to expect a reduction in fraudulent transactions
  • How to develop your strategy

To talk to someone about EMV, you can call Bank of America Merchant Services.

  • Current Bank of America Merchant Service customers, please call 1-800-430-7161.
  • For new inquiries, please call 1-855-833-3610

Merchant-Thumb.jpgEmploying the right payment options, commerce solutions and data security safeguards for your growing business is essential in today’s financial landscape. Streamlining your payment processing can also save you a lot of extra time otherwise spent by manually taking care of all your back-office financial record keeping, processing and reconciliation. But if you streamline your payment processes for mobile, online and in-store, it will free you up to do what you do best: Run your business.


Click here to read our guide: Merchant Services for the Modern Small Business

PricingStrategies_Body.jpgby Robert Lerose.


One of the most vexing problems facing many small businesses is coming up with suitable prices for their products and services. For example, some new businesses will launch with heavily discounted prices in an attempt to build a sizable customer base quickly and establish a foothold in their market. Others will charge premium rates, but fail to show how the customer will get added benefits for the higher cost. Finding the sweet spot in pricing involves research, testing, patience, and an unwavering belief in the value that the small business provides.


Know your expenses

"You have to start by looking at all of your costs. This is where [many] people go wrong," says Janet Attard, CEO of Business Know-How. "Also, if they're starting out as a one-person business, they don't think ahead to when they will need employees and how those costs may change."


Businesses generate both seen and unseen costs that need to be taken into account. For example, besides obvious overhead expenses—such as employee compensation and benefits, insurance, Social Security taxes, office supplies, rent, and utilities—Attard says that business owners often forget to pay themselves a salary and factor that in their monthly expenses. And while a business that sends workers out on the road, such as plumbing, will take fuel and vehicle maintenance costs into consideration, the costs of running the office while the technician is on call need to be calculated, too.


There are a variety of ways to find out standard pricing in a given niche. "You can simply talk to the people in your industry and find out what they’re charging," Attard says. "Or look up people in noncompeting areas and find out what they're charging. Sometimes you can find out from customers themselves what they usually pay." She also recommends the Small Business Administration's pricing guide.


Charging the lowest price for your goods and services may actually backfire in some circumstances, Attard warns. For example, new businesses that significantly undercut their competitors in the business-to-business sector may make the customer think that they won't be able to handle the job successfully or that they are desperate for work. On the other hand, businesses that charge higher than average must prove that they offer and deliver more than the competition. "For somebody just starting out, coming in the middle range of the going prices may be a good idea," Attard says.


PricingStrategies_PQ.jpgDevelop an image

Businesses that have a clear idea of who their customers are may find it easier to set their prices and cater to their audience. "It's not like you have to [sell to] everybody," says Bob Phibbs, CEO of The Retail Doctor. "It's okay to turn some business away. Some retailers in particular deal with hagglers who believe you're gouging them to begin with. You don't want to attract those kinds of customers."


The actual retail store experience can affect how you set prices as well, Phibbs says. For example, customers who shop at a neighborhood grocery store that displays produce in makeshift bins might expect to pay less than what an upscale retailer with nicer lighting and artful presentations would charge for the same products. "Self-image can play a huge factor in how you price your merchandise," Phibbs explains.


While consumers may find cheaper prices for some products online, a brick-and-mortar retailer that has the item in stock at a higher price may make the sale, simply because the item is available then and there. "Americans are getting very, very tired of waiting," Phibbs says. "A good small business is going to help people see that and [prove that] advantage to the customer in front of them."


Be transparent

"The first time I set prices, I didn't have a clue [about what I was doing]," says Naomi Poe, founder of Better Batter Gluten Free Flour, a Pennsylvania-based allergy-free baking mix company. "At the time, our industry was not developed, so there wasn't anything to compare against. I just took my costs and multiplied them by two. I happened to come in right where people wanted to pay, but I don't necessarily recommend [my experience] as a pricing strategy."


Since that less than well planned out opening in 2006, Poe has taken a more systematic approach to pricing her products. Today, after calculating her operating expenses and profit margins, she surveys her biggest competitors in North America and compares their prices, and then works backwards until she comes up with a price that fits her business's position in the marketplace.


SBC newsletter logo.gif"It's all formulaic, but at the same time there's a lot of consumer psychology in there," Poe explains. "You push the numbers up and say nobody's going to buy at that price. You push the numbers down and say we can't afford to do it that way. So you keep calculating until you find the right point."


Poe works consistently to maintain a transparent, loyal relationship with her customers. She notifies them in advance when outside forces—such as rising fuel or commodity prices—are about to send her prices higher. Conversely, Poe rewards them with lower prices whenever possible. For example, when she was able to reduce the packaging costs on bulk orders, she passed the savings on to her customers. Poe also offers stable pricing options whether a purchase is made online or in-store, protecting both the retailer and the consumer.


According to Poe, she only had sales of $3,000 when she opened in 2006, but racked up $705,000 in sales last year. "Transparency and honesty in this day and age are as important as product quality and bottom line price," Poe says. "If you do right by your customer, they'll do right by you."

Google_Analytics_Body.jpgby Jennifer Shaheen.

When was the last time you looked at your dashboard and reports for Google Analytics? If it’s been a while, you may be in for a bit of a shock. In October, Google made significant changes to the reports available through Google Analytics. The navigation you may have been familiar with has changed, but the new format offers a greater level of detail that small business owners can use to market themselves more effectively.

“One major change to the user interface that has a big impact on small business owners is a reframing of the standard reports into Acquisition, Behavior, and Conversions,” says Yehoshua Coren, founder and principal of Analytics Ninja LLC, a Google analytics consulting firm. “These three areas are core for any business to measure their success.”

“The Google Analytics team has simplified what is sometimes an overwhelming amount of data,” Coren explains. “This helps small businesses with fewer resources for analytics to more effectively use the tool.”

Acquisition: Formerly titled “traffic sources”, the acquisition section details where the visitors to your website are coming from. The reports here include: overview, channels, all traffic, all referrals, campaigns, keywords, cost analysis, AdWords, social and search engine Optimization.

“The channel grouping is more than a cosmetic change,” Coren says. “It creates a number of standard ‘buckets’ for user traffic sources by default. These groupings fairly accurately describe the way that most users arrive at a website; such as organic search, social, paid search, email.” Channel groupings are customizable. This is important, he points out, because if a business sells products via comparison shopping engines (like Shopzilla, or NexTag), they can add shopping engines to their channel groupings.

Google_Analytics_PQ.jpgKnowing which one of many routes a visitor has taken to find your website has always been of tremendous marketing value. That’s what makes the new multi-channel funnel report so critical to small business owners. Coren explains, “A user may click on a link that was shared in their Facebook feed and visit a site, and then return to the site a few days later after doing a search for the company by name on Google. With the previous set of standard reports, the website owner would only know that Google was the source of their conversion. With multi-channel funnels, they can see that their social media efforts are paying off.”

Behavior: In the behavior section, you’ll find information about how your website visitors act while they’re on your website. The reports here are: overview, behavior flow, site content, site speed, site search, events, AdSense, experiment and in-page analytics. Examining this data will reveal how visitors move around your website, where they spend the most time, and what type of information is most relevant to them. Additionally, you’ll see how long visitors stay on any one page of your website.

“We’ll see people who stay on a page for less than 10 seconds. That tells me they weren’t interested in that particular item,” says George Anderson, a broker at Greasy Machines, an international dealer of manufacturing equipment. “That’s where things get interesting. If they go to another type of machine, and continue researching, we’re getting a better understanding of how our customers think, and how they’re moving through the sales process. But if they leave the site entirely after that initial 10-second visit, they may not be the customer for what we’re selling.”

This information is important because it reveals how effective you’ve been at presenting content that’s relevant and compelling to your audience. Online activity is a direct parallel to brick-and-mortar purchasing behavior: just as retailers have a better chance of making a sale the longer a customer spends inside their stores, the more time a user spends on your site the more likely they are to buy.

The site search report can help you pinpoint areas of great interest to your customers—and may cause you to rethink your web design to make the most popular products or services easier to find. Remember, for every customer that’s willing to search, there’s at least one who will abandon your sales channel when they can’t easily find what they’re looking for without searching.

You can also compare the acquisitions overview report side-by-side with the behavior overview report. This gives you a succinct view of where visitors come from and what they’re doing on your site. Couple this information from the data from another new report—the demographics section, available in the audience tab—and you’ve got a powerful customer profile you can use to guide your marketing decisions. Be ready to work with your webmaster on this one, as getting comprehensive demographic data requires some minor changes to the Google Analytics code, which is typically not a do-it-yourself task.

Conversion: In the conversion section, Google measures any action that your customer takes that involves going beyond passive engagement. Examples include filling out a contact form, placing an order, or watching a video. Google Analytics allows website owners to determine what type of actions they want to keep an eye on.

“We chose to track two types of conversions,” said Ken Scarbrough of Ultimate Dive Travel. “We tracked both requests for further information about a dive destination, and then reservations actually placed.” Tracking multiple streams of conversion data can provide some surprises: the dive destinations that created the most requests for information were not necessarily the destinations that divers were committing to visit. “Delving into why there was this disconnect allowed us to adjust our messaging and special offers, which helped us sell more trips to those destinations.”

SBC newsletter logo.gifGoogle Analytics: What to expect going forward

“The acquisition, behavior, and conversion framework provides small business owners with an accessible way to think about their customers’ online journey,” Coren says. “It is an improved way of expressing what has made up the core of web analytics since its emergence.

“It’s a major shift in how Google enables data collection,” agrees Adam Ware of SwellPath, a digital marketing agency that helps companies decipher their data to enable business decision making. He foresees a future where Google Analytics’ reach and relevance will extend even further than it currently does. "You'll see small businesses bringing in point-of-sale and other offline data. It'll become more of a collection point for all types of customer interaction—not just website activity."

This makes it clear that the time for small business owners to begin familiarizing themselves with the new Google Analytics reports is now.

Etsy_Body.jpgby Erin McDermott.


It’s the ultimate month of gifting—is your Etsy shop ready?


The crowds are coming, from Black Friday and Cyber Monday shoppers to the last-minute gift-givers looking everywhere for holiday presents. Last year, members of the marketplace for vintage and handmade goods rang up $117.8 million in sales during December, a 73 percent jump from the year earlier; for the year, the total was $895 million, according to Etsy. For its one million active sellers, there are now 60 million shoppers perusing every month, hailing from more than 200 countries.


Yet some concerns are equally universal. Will what I want be available? Can the merchant deliver it in time? Will it be just what I expected?


The charm of Etsy is that its community’s unique products show a human touch—from virtually anything crocheted or inspired by deep artistic craftsmanship to just the right vintage accessory that recalls a fond memory. For customers, that human side can also be a challenge: Many Etsy shopkeeps run their pages as a side business, and service and fulfillment compete with full-time jobs and busy lives. For every fantastic find, there are online reports of wayward sellers who don’t respond or leave clients unhappy.


One of the problems is Etsy’s low barrier to entry. “Anybody can have an Etsy shop. It’s not curated,” says Laura C. George, a business coach who works with creatively gifted artists all over the world. “There’s not a lot of policing of a certain level of talent, or a certain level of business professionalism on the site. I think what often gets in the way is that people don’t feel like their Etsy shops are actual businesses, even though customers certainly feel like it’s a business or they wouldn’t be buying.”


That said, most sellers take their Etsy quite seriously and strive to deliver excellent service. What are they doing to make the holiday shopping season a success for their shops? A few tips from those who’ve made it work:


Etsy_PQ.jpgStart planning early

To make the most of year-end holidays, it pays to start planning at least six months in advance, says George. Media opportunities—gift guides, product coverage, etc.—tend to work that far ahead and should be pursued early, with professional photos of your goods lined up for print outlets, she says. “You need to know what you want to have available for sale and what you’re going to need six months early. It sounds crazy, but it’s how it works,” George says.


Be upfront with policies (and follow them)

Communicating with customers is key. It’s smart for beginners to mimic the giants of e-commerce. Every Etsy page owner’s site should make clear shipping times, costs, currency conversion rates, returns, and even what happens if a product arrives damaged. One step further: Add a request for the customer to message you when they place an order. If a customer is in another country, the rules should remind them that shipments need to go through customs, which can take more than a week. If there’s a shipping tracking number available, send it to the customer and monitor it yourself to document that the package arrives. Because most products on Etsy are one of a kind, it’s often not so simple to just replace what has been ordered. If a problem arises, contact the client immediately, apologize for the situation, and offer a solution. (Take another page from the pros: Add a Top 10 Most Popular List to your site, which could help guide customers to pick an item for a hard-to-buy-for person on their list.)


SBC newsletter logo.gifSet a holiday-delivery deadline

Ask yourself: How much time do you really need to turn around an order in your busiest periods? Before you answer, consider the frenzy of the holiday season personally and professionally, with family commitments and many full-time jobs under pressure to meet year-end deadlines. Conversely, a frustrated customer who comes up empty-handed if an unforeseen problem arises can make what’s supposed to be a cheerful time difficult for both of you. Give yourself and your shipping providers some breathing room. A quick look at more than two-dozen Etsy shops shows Saturday, Dec. 14 as a popular cutoff date to have gifts delivered before Dec. 25.


Cultivate good reviews

Erma Williams-Nurse has a great policy of updating customers at nearly every stage of their orders at her store, The Pomade Shop. Since she set up her venture two years ago, she responds to messages as soon as possible and always within 24 hours. She also always says “thank you” to customers for their purchase and follows up after shipping with an email to find out if the product was received. Before packages leave her desk, she verifies that what’s going out matches the order and, because some of the orders are gifts, makes sure everything looks neat right out of the box. Ultimately, it’s the Golden Rule, Williams-Nurse says. “Be sure to produce what you would require as a shopper,” she adds. “Let’s go forward in the spirit of treating our customers the way we would want to be treated.”

CashCredit_Body.jpgby Iris Dorbian.


To Adam Sah, co-founder and CEO of Best Friend Wholesale & Mercantile, a San Francisco-based specialty grocery store chain, offering the digital currency bitcoin as an alternative payment solution for customers seemed like a no-brainer. Having started in Silicon Valley, where he once worked as a senior engineer at search giant Google, Sah is well-apprised of breaking trends in the tech world.


With this in mind, Sah began accepting bitcoin as a payment option to customers last spring. Though he freely acknowledges the deep ambivalence that greets bitcoin ("some people think it's a scam while others think it's the future of money"), Sah estimates that “two or three” customers per day make bitcoin transactions at one of his stores. Despite this low number, Sah hails bitcoin as a cost-effective alternative to cash and credit. And although bitcoin transactions can be slow due to its still nascent technology, it is free.


Sah is representative of a growing contingent of small business owners who, in an effort to drive customer traffic and pique interest in their respective companies, are thinking beyond the traditional payment methods. Though the verdict is still out on how well unorthodox payment choices, like bitcoin or barter, can benefit a company, some small business owners are experimenting with nontraditional offerings to build a customer base and forge relationships with vendors.


The latter has been key for Katherine Zeppos. As owner of the five-year-old, Lancaster, Pennsylvnia-based Katerina’s Finest, an olive oil importer and distributor, Zeppos says signing up with a barter network, comprised of local small business owners and companies that offer personal services, has been a godsend, particularly for financially-strapped startups like hers.


Services that Zeppos has accepted as barter usually depend on what she may need at a given moment, such as photography for her website. At the same time, she does concede a basic, non-negotiable maxim to her business operations:  “I rely on normal business sales. My business cannot be based only on barter,” she says.


Still, offering barter has afforded Zeppos considerable benefits to her business. “I have been able to sell my products all over the U.S. through barter and to Canada, too,” says Zeppos. “It is a great form of networking.”

Though nontraditional, both barter and bitcoin transactions can be a good way of drawing in customers while mustering up excitement over its usage. For small business owners contemplating adding alternative payment solutions to their menu of legal tender, consider these tips:


Don't be intimidated

Just because the payment solution you're offering is not the tried-and-true standard exemplified by cash or credit, that doesn't mean its implementation will be difficult.


Says Sah: "It's easier to do than you might think."


First, tell your customers, by word of mouth, ads, or sticking notices on your storefront window, that you will be offering this alternative payment solution. And of course, make mention of it on your website. Also, Sah suggests registering with various websites (e.g. that list which businesses accept bitcoin.


And for those interested in offering bitcoin, Sah says there is a plethora of websites that track where you can send bitcoin transactions. (They include: Bitcoin, BitcoinMining, UseBitcoins, and Howtobuybitcoins.)


And for those interested in signing up with a barter network, check out the following: The Barter Network, ITEX, The Business Barter Network and IMS Barter.


CashCredit_PQ.jpgBe realistic about your expectations

Don’t expect an upsurge in business just because you’re accepting bitcoin or barter as a payment solution. Know what kind of benefits you want to achieve to your bottom line. Ask yourself how these nontraditional options will bring you closer to your business goals


Because Zeppos knows that her business cannot rely on barter as a principal source of revenue, she sets a benchmark amount that can be sold that year with barter. “The barter benefits I earn I try to invest into my business again,” she says.

Make sure your merchant system supports an alternative payment solution

As in the case of foreign currency relative to the U.S. dollar, bitcoin rates can fluctuate. Though it may not be much more than the euro or other foreign currencies, says Sah, small business owners who are considering adding bitcoin to their payment choices need to be aware of this and adapt to it accordingly.


"The good news is any cell phone or laptop computer will do the conversion for you," says Sah.


To avoid errors, small business owners need to make sure that whatever bitcoin site they sign up and register with gives them a specific bitcoin address to receive payment. The bitcoin address, which is a list of numbers, can then be converted into a QR (quick response) code that merchants can scan when processing a bitcoin transaction.


Also, make sure you find a way that will let you know that a bitcoin transaction has been processed. This can be a simple text alert or e-mail.


When in doubt, err on the side of simplicity

Because the technology of bitcoin is still very green, small business owners should think about designating an IT person on staff (or outside the company) who can troubleshoot problems as they arise. Having someone who can provide immediate technical assistance will also help reassure other personnel who are not as tech-savvy.


Small businesses wishing to offer unconventional payment solutions like bitcoin or barter might find a climate far more conducive to embracing these options than in the past. But be realistic and don’t expect your business to change radically overnight. Being a visionary and a maverick are great entrepreneurial traits but not when tempered by rash behavior and willful obliviousness.

Note: Bank of America is not responsible for user posts and other user content appearing on this website and does not endorse or guarantee the perspectives, the advice, the users, the businesses, or the products or services offered by any users or businesses that appear on this website.

MerchantServices_Body.jpgby Iris Dorbian.

To any small business, regardless of industry sector, choosing the right merchant services, which enables customer payments to be made via credit or debit card, is as necessary to its operations as breathing is to all living creatures. And yet it may also be one of the most confusing and complicated tasks for business owners to undertake.

A key challenge is how to deal with interchange or swipe fees, which is what a merchant services’ bank will charge a customer’s bank for the transaction, with the small business owner bearing the brunt of the costs. Although recent regulation, such as the Durbin Amendment, which reduces by nearly 50 percent the average amount of interchange fees that merchants pay for credit or debit card transactions, may have initially seemed like a boon in theory to small business owners, what has transpired indicates the contrary in practice.

“The Durbin Amendment is widely considered a legislative failure,” says Eric Stauffer, a consultant at the Los Angeles-based CardPaymentOptions, a watchdog group that helps small business owners get fair credit card processing deals from reputable companies. “The final rules [of the amendment] were changed at the last minute to allow issuing banks to add fees excluded in the original regulation, essentially doubling the purposed 12 cent fee cap to 21 cents plus 5 basis points (0.05%) of the transaction value and a 1 cent fraud prevention fee.” Consequently, transactions under $12 cost the small business merchant more that they did previously.


MerchantServices_PQ.jpgThis is a key proviso for small business owners to keep in mind when seeking out a merchant services provider. Following are several tips that can be invaluable when selecting the right merchant services for a small business.

Figure out your sales volume

What’s your average monthly amount of sales? What is your average sales transaction amount? Once you answer these questions and set a benchmark for both, you can hone in what you want your merchant services to provide for you. It also allows you to avoid paying for unnecessary services, such as reoccurring payments, says Jennifer Gaddis, founder of Heels and Jeans Project, which teaches busy women and working mothers how to improve their work-life balance.

She cites an example of a merchant services provider that charges $30 per month for a regular merchant account but then also includes a $30 monthly charge for reoccurring billing for another account. "However, if the merchant services don't offer monthly payment options to their customers, [a small business owner] could simply use the regular merchant account for $30 per month," explains Gaddis, who runs her business with a staff of three. "This will save you money."

Other questions to ask yourself: Where and how often do you plan on collecting credit card information? Will it be through online information fields or at a checkout counter in a brick and mortar operation? Answering these questions will help you figure out “whether you need to integrate your merchant account with other services that may require additional monthly fees,” says Joe Bielling, founder of Your Merchant Guru, a consulting service that negotiates contracts for merchant services. “In most cases, it will make more sense for you to buy your equipment especially to benefit from lower card swipe rates rather than leasing.”

Expanding on his last point, Bielling says owning a credit card terminal versus leasing it is the more cost-effective alternative given that the terminal can be purchased for “a few hundred dollars” in contrast to the “ongoing monthly fee of $20-$50 for leasing equipment, which would easily surpass a few hundred dollars over the course of a typical three-year leasing contract.”

Avoid the one-size fits all approach

Just because a merchant services account or provider may work for a few small businesses you know, doesn’t mean it will be the right fit for yours. Every company is unique, with its own set of needs and priorities.

“Think about what’s best for your business,” advises Bielling. “A clothing boutique will have radically different credit card processing needs than a home office consultant or a new manufacturing operation. In fact, the only thing most small businesses have in common is the desire to get paid quickly and affordably.”

Research merchant reviews

If you’re going to buy an item such as a specific computer laptop, typically you do some research to find out what other consumers are saying about it. Similarly, you should do the same due diligence when finding the right merchant services for your small business.

“Merchants are not shy about expressing their like or disdain for particular businesses in the merchant services industry,” says Stauffer. “Doing a little online research before signing up can save a lot of headaches down the road.”

Don’t fall for low-rate offers

If something seems too good to be true, chances are it is. “In some cases, these type of rates go up before the contract is over,” warns Bielling. “Hidden fees and line item charges also offset low rates. Compare your total monthly billing with your total cost of processing those payments. Your credit card processor should have cost-effective solutions that meet your needs today, while allowing features and services to be added or discontinued as you grow.”

Make sure all of your merchant services solutions work together

If you are using more than one merchant services at your small business, it’s imperative that each system mesh well with the other.

“There's nothing worse than getting all excited about how much a new service is going to help your company, only to find it doesn't at all integrate with what you're already using,” says Flynn Zaiger, CEO of Online Optimism, a New Orleans-based digital marketing agency that sets up and manages e-commerce sites for clients. “The best way to make sure nothing like that happens is ensuring buy-in from all of the managers of a company so they're all aware of each of the service's benefits and trade-offs.”

To expand on his point, Zaiger offers an example.  One time, he signed a client up for a very easy-to-use online storefront builder for small businesses, he recalls. “Two months into using the service, though, their accountants decided to use a sales tax software program without checking if it would integrate,” Zaiger adds. “Needless to say, there was a slight hassle in getting two systems that hadn't ever met each other before to actually communicate. But eventually we were able to patch everything back together. A little more talking between the people at the company would have saved us the time.”

Read the contract thoroughly

Before signing an agreement with a merchant services provider, be sure to read the fine print.  “Each provider is going to have their own contracts, and there is no such thing as a boilerplate agreement,” says Stauffer. “Just because the sales rep said you will be paying 1.49 percent + 20 cents a transaction, does not mean that is your final cost. Transactions are usually split into different tiers, and sales reps often only cite the lowest tier.”

Make sure the customer service support works

For Zaiger, whose staff size for his start-up is only two employees right now, this is a key best practice when choosing the right merchant services for clients. “Even if we had no questions, we always give them a call to make sure their response time is speedy,” he adds. “It's essential when starting a new service to be able to have help on the line within minutes of an issue. Making sure that you don't have to wait a full day for a response when something goes wrong will save you 24 hours of headaches and lost sales in the future.”

Things to consider when choosing a merchant processor:

  • Access to funds. Will the merchant receive next day funding?
  • Customer service. Does the processor have 24/7 support?  Is the support in the US or offshore?
  • Needs outside of core card processing
    • Check acceptance
    • Gift cards
    • Security: encryption, PCI protection
    • Loyalty programs
  • Equipment type. Does the merchant have mobile needs? Does the merchant need an entire POS system or just a terminal?
  • Does the merchant require online sales products?


Sidebar: Merchant Services Shopping

For small businesses currently searching for merchant services providers, check out the following online resources. Not only will they help you zero in on a provider that’s right for you but help you do some cost comparisons as well.


Body_Swipe.jpgBy Iris Dorbian.


For small business owners, they’re a nightmare that can cost untold money and time to correct. Unfortunately, in this increasingly digital economy where fraud or consumer fickleness runs rampant, they’ve become increasingly commonplace. What is this bane of every merchant’s existence? Credit card chargebacks.

Chargebacks happen after a consumer disputes a credit card charge. To rectify the supposed transactional error, the card issuer will then credit back the amount of the charge to the consumer’s card while leaving the merchant with a gaping hole in his or her merchant account. Sometimes a credit card chargeback can be the result of human error, technical glitch, or in the worst-case scenario, deliberate fraud. However, even if the outcome was triggered by illicit intentions, small business owners still have to contend with the fallout, which may include penalty fees incurred as a result of these chargebacks.


PQ_Swipe.jpgCard Hub, a credit card information site, recently released the findings of it its 2012 Chargeback Policy Report, which polled the top credit card companies to find out what consumers need to successfully execute chargebacks. The study revealed that: 


  • Among the credit card networks and issuers that responded, all have consumer-friendly chargeback policies and tend to favor the customer over the merchant;
  • Usually a merchant is charged back in the event that the merchant does not respond to a customer’s dispute; and,
  • The most common scenario in which the customer is not credited for a dispute is when a customer is unable to produce a receipt when claiming that a tip was inflated.



In a sales climate in which “the customer is always right,” how then can merchants minimize credit card chargebacks? The following best practices can offer relief from these annoying gremlins of credit card commerce:

Document, document, document

Kate McGinley, the owner of the Pittsburgh-based  McGinley Media, a nearly four-year-old web development and marketing firm with a staff of 11, has been an unfortunate and frequent victim of chargebacks. So much so that now every time her company performs a service for a client, McGinley always makes sure to produce a paper trail that will support and verify that the client received what they ordered. This due diligence was prompted in response to an incident that she says almost resulted in the closure of her business.

“I had a client who had my company build an app for thousands of dollars and then issued a chargeback, saying he never got it,” recalls McGinley. “He's currently selling the app in an app store. That chargeback was the biggest one [I’ve had]. After that experience, it became our policy to also send a flash drive with the code/graphics work we've done to the client. We also get delivery confirmation as well.”

Ask every cardholder for multiple IDs

“If [the name] doesn't match, do not allow the transaction to be consummated,” says Jim Angleton, president and CEO of Aegis FinServ Corp, a three-year-old prepaid debit and credit card issuer that frequently deals with small business clients.

Also, if the cardholder is asking for cash back, Angleton says the merchant should review the signatures on both the card and ID to see if they match.  But even then, the merchant still needs to exercise extreme caution.

“Cash back and possible returns can make for problems,” notes Angleton, who has nine employees in the U.S. and six in Central America. “I've seen unsuspecting employees give a full refund including the cash back.


Pay attention to each individual order

If you’re a larger company or website that processes a multitude of orders per day, this is a difficult best practice to follow, particularly if the orders are automated. But for Izzy Goodman, founder CCS Digital-Com, a family-run online operation that sells ink cartridges, it’s become the standard when dealing with customer orders and preventing fraud.


“Orders come in to us and we have to process them,” explains Goodman. “They don’t happen automatically. So we’ll catch such things as address or security code mismatches. We insist that the shipping address match the billing address—at least on the first order.”


Although some customers may get irked at Goodman’s extreme vigilance when it comes to verifying names and addresses, he insists it’s not only for his protection but theirs as well. He cites an example: “When a scammer got hold of my credit card number and ordered items to be shipped to a different address, my issuer flagged it as suspicious and called me. Yet there are people who routinely use their card and have items sent all over. Then they get upset when their cards are used fraudulently.”

Provide stellar customer service

It better not be merely good, but excellent, insists McGinley. “This mostly prevents chargebacks from those who may not like your product or service,” she adds. “By offering good customer service, you have the opportunity to fix the problem before the chargeback.”


When in doubt, e-mail the customer

To prevent online fraud, which can often result in chargebacks, this is a key takeaway, says Goodman.


“Scammers try to use a card quickly before it is reported stolen,” he says. “If you send an e-mail, scammers very often won't reply because they're too busy placing orders with all their different stolen cards.”


Understand your merchant agreement

“Read carefully your merchant agreement,” advises Angleton. “Make sure you understand the merchant discount percentage and costs associated with card acceptance and card processing. They should be in the range of 1.75 to 3.75 percent.”  He also counsels small business owners to carefully review their monthly and merchant statements for unknown charges, unknown fees and out of place chargebacks.



Have a liberal return policy

“If you can prove to the issuer that your customer can easily get a refund, they will deny the chargeback,” maintains Goodman. In this instance, he adds “there is no reason to do a chargeback unless it’s a scam.”


He also adds that in the past when a customer has done a chargeback several months after a transaction claiming product ineffectiveness, Goodman contacted the card issuer to explain that “it doesn’t take several months to discover [our ink cartridges] don’t work.”


Credit card chargebacks are vocational nuisances for all small business owners. But if you follow some precautionary measures, you will start minimizing them, if not squelching them entirely.

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