5 Things You Need to Know About PayPal’s Magento Migration Loan

5 Things You Need to Know About PayPal’s Magento Migration Loan

The clock is ticking and Magento 1’s end of life (end of support) is right around the corner. For over a year, we’ve provided webinars, E-books, and security insights to help ease your migration worries. Now, Redstage teamed up with PayPal to provide access to Magento Migration loans for qualifying merchants.

With a “no merchant left behind” mentality, Redstage and PayPal are committed to making sure all business owners can scale further while fully experiencing the power of Magento 2.  Here are 5 ways to get the best out of your migration experience.

1. Why You Should Migrate

 

Hour glass in rocks for countdown to migrate

 

Magento 1 support ends on June 30, 2020. While it may be difficult for some merchants to say goodbye, more revenue is waiting to be unlocked with Magento 2. On average, a Magento 1 Migration takes 6-10 months to complete and with 7 months until the platform sunsets, merchants are running out of time. More importantly, you’re missing out on additional revenues. Migrating to Magento 2 gives merchants access to a newer and more advanced eCommerce platform that provides security, functionality, and flexibility. Grab our free Magento Migration eBook here, or read on for a quick breakdown:

Security

With good reason, we’ve shared many tips on how to help protect your online store from fraud. End of Life means the end of security, and once June rolls around there will be no more Magento 1 security patches to save you. Hackers have familiarized themselves with the platform and broken extensions make their job easier. In the past year, Magento has released over 10 security patches for M1 (that’s at least 1 a month), and developers have stopped upgrading M1 extensions to focus on M2. These constant breaches leave your store, customers, and your bottom line at risk.

A positive customer experience is measured by many things, most notably how safe your customers feel. 41 percent of consumers switch retailers due to poor personalization and lack of trust. Magento 2 shows merchants are taking security seriously as the platform provides security updates with bug fixes, back-end administration protection, and encryption for credit card information.

Functionality

60% of B2B buyers demand a seamless customer experience and 47% expect traditional retailers to be as agile as Amazon. Magento 2 is committed to delivering a better shopping experience that allows merchants to produce a fast, simple, and frictionless checkout experience across all devices. Page loading and checkout speed have increased by 50 percent and 38 percent respectively, compared to the Magento 1 platform. The Magento 2 migration is the perfect recipe for a successful customer experience.

In a world where responsive design is trying to give customers all the same functionality we have on desktop in mobile, there may be a divergence here where we have to start thinking about different mobile experiences. Customers need to be able to go through the entire journey, from the research perspective to pricing, negotiation, approval, and purchase, ALL through their smartphones. Millennials will switch to your competitor immediately if you can’t give them that entire experience.

Adam Morris, CEO, Redstage.

Flexibility

As our ongoing Mobile Optimization Initiative shows, Magento 2 gives merchants total control over creating a great user experience. The platform includes highly customizable themes and over 2,000 extensions. Your customers are more likely to come back for more if you continue to meet their expectations, so keep impressing them by upgrading your experience on different devices. Customize your theme in a way that highlights your brand and tells your brand’s story, or highlight products and provide a secure checkout all in one place.

38.8% of total Magento Merchants (Community or Enterprise) are still on various versions of M1. By not upgrading, merchants are putting themselves and their customers at risk. Magento 1 sites, among a dwindling community of users, will face a lifetime of declining usability, patchwork fixes, increased upkeep costs, and a higher level of maintenance than if they migrate to a new site or platform.

Aidan Mcknight, Solutions Engineer, Redstage

2. The Migration Loan Explained

 

Upclose shot on open book for loan explanation visual

 

Migrating your website, budgeting for next year, and making sure you meet your end of the year sales goals can be overwhelming. The Magento Migration Loan can ease your worries, especially if you haven’t budgeted for migration.

The loan can help your businesses experience the new and improved advancements of the Magento 2 platform and provide the means to help keep your customers safe. PayPal and Redstage understand that the future of retail is digitally optimized. Online retail sales are expected to reach $735 billion by 2023. However, more than half of today’s retailers do not have access to debt or equity financing to help scale their business.

This migration loan is a first step to bridging the gap in financing solutions for online businesses. To  accomplish your migration with a Magento Migration Loan, you must first apply for the Magento Migration loan here. Loans can range from $5,000-$500,000 with no hidden charges attached2. Upon approval, WebBank will transfer funds to your business’s bank account as fast as the next business day 3.

3. How to Apply and Receive the Credit

 

close up on man filling out application for loan

 

To secure a full credit on the cost of financing your migration, start by applying for the Magento Migration loan by visiting the LoanBuilder application page. If approved, you must follow these three steps to receive the credit4.

  1. Sign a Magento renewal license invoice that shows at least one payment.
  2. Open a PayPal Business Account.
  3. Sign a 3-year processing contract or renewal agreement with Braintree and process with Braintree on your new Magento 2 website for at least 3 months.

Benefits of Braintree

Driving revenue and maximizing business opportunities are crucial in scaling your business. To fully experience the power of Magento, should also be taking advantage of Braintree. The global payment partner is the missing piece you need to combine safe and frictionless customer experience like those seen in our recent tests. Braintree is a payment platform that delivers mobile and web payment systems in a single, seamless integration.

This year, there are approximately 1.92 billion digital buyers out there. That number is expected to almost double by 2021. The smart money is using this time to plan and test new ways to unlock more holiday revenue. The Magento migration loan is your first step to guaranteeing a prosperous future.

Moreover, Braintree offers other ways to drive revenue and maximize business growth overall. The single integration allows you to reach more buyers around the world, reduce checkout friction, increase efficiency, and migrate fraud risks. Remember, a fast, safe, and frictionless checkout experience increases conversion rates.

4. How to Become Eligible

 

Woman with green jacket throwing confetti celebrating becoming eligible for migration loan

 

If you’re operating on the Magento 1 platform and have been in business for at least 9 months, you’re halfway through the eligibility process. Your business must also be located and operated in any of the 50 United States or Washington, D.C. and earning at least, $42,000 in annual revenue. That’s it!

Unfortunately, the M1 end of life comes at a time outside of the normal re-platforming strategy for many clients. When we design and build on the latest technology, we want to amortize the costs for as long as possible and switch only when the pressure from competitors and customers increases. I love that PayPal is helping our clients solve this problem by helping them fund the migration process. This makes the process much easier to handle from a cash flow perspective and allows us to invest in a customer experience that’s outside of the normal cycle.

Adam Morris, CEO, Redstage

Final Thoughts

With roughly 200 days remaining on the Magento 1 End of Life countdown the time for procrastination is over. Each day merchants wait, their revenue, customers, and reputation are at risk. Redstage and PayPal are committed to helping businesses grow and thrive, showing merchants how to unlock the revenue they deserve and build positive customer experiences. In the name of a prosperous and profitable 2020, revitalize your brand, enhance your customer experience, check your eligibility, and apply now for a chance to enjoy a fully credited migration loan from PayPal.

If you work for in B2B, click here to learn how you can migrate to Magento 2 in just 40 days!

 

 

Disclosures
1 The lender for the LoanBuilder Loan is WebBank, Member FDIC. This is an invitation to apply and not an offer or commitment to provide capital. Applicants must satisfy certain requirements to be eligible. WebBank is not affiliated with the offer to receive a full credit on the cost of financing and the credit is not part of your credit agreement with WebBank.
2 In addition to the fixed fee (Total Interest Charge) for the loan, the only other cost is a $20 Returned Item Fee that is only assessed if a payment is returned.
3 The lender transfers funds to your business’s bank account as fast as the next business day if the lender has received the documents the lender asked for and approved the loan by 5:00 p.m. Eastern Time, Monday through Friday (excluding bank holidays).
4 Merchants will receive the full credit from PayPal within 6-8 weeks of having fulfilled all three migration requirements. Merchant may be contacted by a Braintree Enterprise Sales Representative to receive more information about creating a merchant account with Braintree.
Are DTC Companies Risking It All For Killer Customers?

Are DTC Companies Risking It All For Killer Customers?

Let’s face it, customers have done a great job of redesigning the eCommerce industry through excessive demands and high expectations. However, what happens when these demands cut into profit, putting your company at risk? There’s a fine line between loyal and killer customers. In this 3-part series, we reveal the top 3 ways killer customers attack your profit, along with methods you can use to identify and avoid these scenarios.

Part 1. Return Abuse (This Article)

Part 2. Shipping Scams and How to Prevent Them

Part 3. The Difference Between Friendly Fraud and Chargeback Fraud

The Killer Customer

Whoever said the “customer is always right” certainly never encountered an abusive customer. Killer customers are more than unprofitable customers, they continuously drain money from your organization. Since a great customer experience is high priority, many merchants find it difficult to maintain positive rapport with the bulk of their customers while keeping killer customers at bay.

Return policies are meant to protect a company’s reputation and give them competitive advantages. However, in the hands of killer customers, returns can be the number one profit killer. The average return passes through 7 people before listed for resale, devaluing the item. After factoring in time and costs of shipping, processing, evaluating, and restocking returned items, only a handful of these items can be resold at full price, and many will be sold at a loss. Over time serial returners cause your bottom line to suffer, but modern merchants have options.

While you work hard to safeguard your store this holiday season, consider amending your return policy to combat the 4 most common abuse tactics your killer customers use against you.

1. Wardrobing

Lady in pink wedding dress sitting on bench looking to the right

Shoppers often purchase items they intend to use or wear only once before returning. This process is known as wardrobing and is most common with fashion merchandise. Today, wardrobing is a massive problem for retailers and online merchants alike, accounting for over 7.6 billion dollars in losses in 2017.

40% of retailers have seen an increase in “intentional returns” over the past year. This is proving to be an incredibly expensive burden for retailers to take on – particularly when almost half of the retailers are already seeing their margins being severely impacted by the cost of handling and packaging returns.

 -Scott Hill, VP of Product, Brightpearl

Preventing Wardrobing  

When implementing a solution, merchants must think of a cost-effective approach that doesn’t negatively impact honest shoppers. Implementing the Shark Tag is popular new approach retailers are taking. The Shark Tag is a one-time at-home removable tag attached to garments. By placing tags in visible areas, the idea of wardrobing becomes less attractive to customers. Once the tag is removed, items become non-returnable and non-refundable.

2. Fitting Rooming

white-and-black-floral-cap-sleeved-shirt-

As you know by now, customers expect brick and mortar stores to mirror the same shopping simplicity they experience online. The reverse is apparently also true, with some killer customers bringing the “fitting room” home with them. This process is called “Fitting Rooming” and in these cases, customers order the same item in different sizes and colors to try on at home. Once they are satisfied with their item of choice, all the unwanted items are returned. Online stores that offer free returns are key targets for this kind of abuse.

Preventing ‘Fitting-Rooming’

Solving the issue involves a more creative approach that can increase brand loyalty and invite new customers. Retailers can adopt a “Try before you buy” service to allow customers to test out items they’re interested in before being charged (normally between 7-30 days). Subscription boxes also follow a similar approach, allowing customers to pay monthly to sample specific products before purchasing. These strategies help merchants keep track of specific items they expect to be returned, lowering the costs associated with unpredictable ‘Fitting-Roomers.’

By the end of 2019, A quarter of all retailers are expected to incorporate a “try before you buy service.” This practice allowed companies like Stitch Fix to see a 25% increase in net revenue over a year. Customers are more likely to opt into “pay later” options with confidence, knowing there’s a hassle-free return involved. Best of all, you’ll see an increase in conversion rates.

3. Counterfeit Returning

Close up on two store receipts

We recently warned eCommerce companies about cybercriminals getting creative with their hacking tactics. If you gave the article a read, you may not be surprised to learn killer customers are getting just as creative. Thieves a re now using high-quality scanners and printers to make counterfeit receipts and return merchandise they’ve previously stolen from stores. Also, customers are taking extreme measures to use fraudulent credit cards when making online purchases to return items in stores in exchange for money or store credit.

Companies like Nordstrom built brand loyalty based on their legendary “free to return everything” policy. This policy allows customers to return items without a receipt regardless of when (or if) the purchase was made. Abusing this policy can severely damage sales, gross margins, profitability, and most of all, make inventory management a nightmare.

Preventing Counterfeit Returning  

To eliminate counterfeit returns, it’s always a good practice to require receipts. Take it a step further to implement a 30-day limitation on returns and/or restrict popular items and high-volume orders from being returned. These minor tweaks will turn away customers who seek to return stolen merchandise and can also keep away Fitting-Roomers. Lastly, utilize an ERP or platform, tracks repetitive returns by requesting proof of identification. This process makes it easy to cross-reference sales and get alerts when a customer excessively returns items. Once you know who your killer customers are, you can ban them (or at least take them off your email lists).

4.Customer Service Abuse

Abuse from customers is not part of the job sign

Offering lenient return policies, providing 24/7 accessibility, and creating engaging content reflect excellent customer service, but there’s a limit. These practices subject retailers to vulnerabilities as abusive customers take advantage. Identifying and dealing with these customers becomes difficult and, in some cases, an expensive task to take on. Customer representatives spend hours handling disorderly phone calls and receiving verbal assaults. This manipulative tactic is used to further gain refunds and discounts from merchants.

Beyond assaulting your customer representative, your reputation is next in line. If customers don’t receive the shopping experience they feel they deserve, they will switch to you competitorwhile dragging your reputation through the mud. Social media is easily accessible for killer customers to provide negative feedback about their experiences with your brand, and can spread like wildfire. Upsetting the wrong customer with the right amount of influence can become a PR nightmare. If your brand has a bad reputation, 90 % of customers won’t shop with you.

Preventing Customer Service Abuse

 After implementing the previously mentioned solutions. Invest in training for your customer representatives. Focus on equipping them with the knowledge to properly manage abusive customers using proper escalation procedures. Lastly, closely monitor all social platforms to stay on top of negative comments, and have policies that clearly outline how and when your reps are allowed to pass on benefits and freebies to customers. You can also use Instagram’s “hide offensive comments” feature to automatically filter out offensive comments and block users on the platform.

Final Thoughts

Analysts predict that online and offline return fraud will cost companies $550 billion by 2020 and $3.5 billion during the holiday season. While the goal is to satisfy your customer and keep them coming back for more, be sure to protect your business in the process. However, as we pointed out above, serial returners and abusive customers can have a similarly devastating affect on your business. If you don’t have much info on your killer customers, now may be the time to rethink your priorities, especially as the post-holiday returns season looms.

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