Creating Exceptional Customer Experience with Embedded Payments

Michelle Johnson
Oct 29, 2024
4 min read

What Are Embedded Payments?

Embedded payments are justifiably gaining traction in the payments world. They bring the entire payments process within an app or website, allowing customers to complete their purchases without needing to leave for an outside platform. This enhances the customer experience, reduces failure points, and provides merchants with access to additional data that can help increase ROI.

When implemented, embedded payments make the purchasing process feel invisible. Consider Uber; regardless of whether the user is booking a ride or ordering food, they remain within the app. Payments are seamless; there’s no need to reach for a credit card or to wait for a redirect to a third-party platform that might not be available. Order the food or take the ride, and payment is done. Not only does this make Uber (and other services like it) an effective customer experience, it provides the merchant with complete control, from initial browse through to purchase.

Why Embedded Payments Matter for SMEs

With API-led payments platforms now widely available, embedded payments are no longer exclusively for the big players, like Uber and Amazon. They’re now accessible for small and medium businesses, and are a powerful tool that can enhance customer loyalty, preserve brand integrity, and provide operational insights:

End-to-End Customer Journey Insights

Advantage: Embedded payments allow the business to track a complete picture of the customer journey—from product browsing to checkout—without the interruption of a third-party payment redirect.
Use Case: An SME can analyse where customers drop off in the checkout process, identify any points of friction, and optimise the flow. For instance, if many customers abandon their carts just before confirming payment, the SME could introduce streamlined checkout or one-click payment options to reduce friction.

Customer Retention & Loyalty Data

Advantage: Embedded payments provide insights into repeat purchase behaviour within the brand’s own platform. Since customers don’t leave the SME’s site or app, it becomes easier to track loyal behaviour and re-engage users without losing them to potential distractions on external sites.
Use Case: An SME offering pet supplies, for example, might notice patterns indicating that customers regularly buy pet food every three months. The SME could use this data to set up automated reminders or even a subscription service, directly encouraging repeat purchases and improving retention.

Integrated Data for Real-Time Personalisation

Advantage: With embedded payments, all transaction data is immediately available within the brand’s own CRM and analytics tools, enabling real-time personalisation. Non-embedded options may introduce delays, limiting the ability to act on data in real-time.
Use Case: A coffee shop chain using an app with embedded payments can instantly offer a personalised discount on a new drink type right after a transaction completes. By detecting the customer’s preference for espresso-based drinks, the app could offer a promotion on similar products before they leave the location.

Customised Security & Fraud Prevention Insights

Advantage: Embedded payments keep all customer interactions within a single ecosystem, allowing the SME to better monitor unusual purchasing patterns and detect potential fraud without relying on third-party reports.
Use Case: A subscription-based SME in wellness products can use embedded payment data to flag unusual activity, like sudden changes in shipping addresses or large, out-of-pattern purchases. The business could then prompt users for identity verification in-app, reducing fraud risk.

Single Customer View Across Channels

Advantage: With embedded payments, SMEs gain a unified view of customer activity across both online and offline channels (if integrated), which is harder to achieve with redirected payment flows.
Use Case: For an SME with both online and in-store channels, such as a small fashion retailer, embedded payments mean that purchase history, preferences, and loyalty points sync seamlessly. This lets the SME deliver a more cohesive omnichannel experience; for instance, an online customer can redeem loyalty points in-store with full visibility of their previous transactions.

Some of the main providers in the UK are Stripe, Square, Adyen, Checkout.com, PayPal (Braintree), and GoCardless. Each of these providers have unique strengths, so the right choice will depend on an SME's specific needs, such as payment types, customisation level, and whether they require in-person or cross-border payment capabilities.

For a visual summary, our infographic breaks down these key benefits, helping identify where embedded payments can improve your SME’s customer experience.

How SMEs Can Implement Embedded Payments

Implementing embedded payments is an achievable, valuable enhancement, albeit not without its challenges. Here’s an effective approach:

Define the Customer Journey: Map out the ideal customer experience. Identify where payments fit within this journey, aiming to reduce actions for the customer while ensuring security and ease.
Select a Payment Provider: Choose a provider aligned with business requirements (such as cross-border payments or card-present payments). Look for options that integrate seamlessly with current systems or support new features.
Engage a Developer: Partner with a developer familiar with embedded payment frameworks to ensure the integration process is smooth. Their expertise can help avoid disruptions to ongoing operations.
Test & Optimise: Launching is only the beginning. Continuous testing and optimisation are essential, with adjustments based on customer feedback, making sure the experience aligns with real user needs.

AI-Readiness & Future Potential

Embedded payments, properly implemented, work immediately to improve customer experience. They also help set the stage for the adoption of AI, providing the foundation for advanced AI features like personalised recommendations or dynamic pricing strategies. This future-readiness enables businesses to adapt to evolving customer expectations and deliver increasingly tailored experiences.

Ready to Integrate Embedded Payments?

Are you prepared to see how embedded payments could shape your long-term success? The benefits extend far beyond convenience, contributing to growth-focused decisions and elevating customer experience in a competitive landscape.Want to see how embedded payments could help your business scale? Let’s talk about how you can integrate these capabilities for lasting customer loyalty and operational insight.

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