Four Merchants Revealed How Bitcoin Payments Helped Their Businesses
While it does not represent the whole industry, a recent survey of four merchants that accept bitcoin (BTC) and other cryptocurrencies offers some insights on how this nascent payment method might help business.
After major crypto payments company BitPay introduced four of its undisclosed clients to research and advisory firm Forrester Consulting the latter has found that crypto payments can attract new customers and purchase amounts can be bigger than those made with credit cards. Both companies did not disclose the names of the respondents, only revealing that they represent an online gift card marketplace, gold and precious metals broker, domain name registrar and website hosting service, and computer and electronics retailer.
They reported total ecommerce sales of between USD 100m and USD 1.2bn, and the share of bitcoin and other cryptocurrency payments using BitPay is between 0.5% to 6.5% of total ecommerce sales, Forrester said, adding that for some merchants, a specific product line’s share of total sales is even higher, reaching 10% or more at times. Also, average order values for cryptocurrency sales are between one-half and triple the average for all sales, it added.
“First, up to 40% of customers that pay with crypto are new to the merchant. Second, purchase amounts are twice that of credit card purchases. Third, crypto is less expensive than card cards, and lastly, there are no fraud-related chargebacks,” BitPay commented.
Meanwhile, the coronavirus pandemic has led to a major increase in online shopping across a number of countries, with Forrester citing data from a report that showed 11% of consumer respondents said they used a digital payment method for the first time during that time. This has created growth opportunities for retailers who enable their customers to pay with cryptocurrencies, as suggested by the consultancy.
“While adoption of cryptocurrencies like bitcoin is still emerging,” the interviewed merchants managed to capture “significant benefits at relatively low risk and cost,” according to the study.