Different payment methods have gained popularity in different parts of the world. For example, buy now, pay later is widely used in Australia and the Nordics, while account-to-account payments lead the way in the Netherlands and Brazil.



As commerce becomes increasingly globalized, merchants everywhere must adapt to these local payment preferences—or risk losing customers.



In a PaymentsJournal Podcast, Tulio Gambogi, Head of Alternative Payment Methods at Worldpay, David Sykes, Chief Commercial Officer at Klarna, and Don Apgar, Director of the Merchant Practice at Javelin Strategy & Research, discussed the challenge of keeping pace with the wide range of alternative payment methods (APMs). While this may seem overwhelming for individual merchants, payment experts are ready to help businesses stay aligned with the methods their customers rely on.





Connecting with Local APMs



Despite the fact that payment rails connect businesses and consumers around the world, payment experiences remain local. How consumers in Brazil pay is very different from how consumers in China do. E-commerce merchants, in particular, need to understand and adapt to local payment preferences in each market.



While supporting APMs might seem like a costly undertaking, the opposite is often true. Local payment methods are frequently more cost-effective than relying solely on traditional payment rails.



“From my perspective, we're usually a price leader because we've got 111 million active consumers,” said Sykes. “Many of them are linked to a bank account or a debit card. In a lot of these markets, we can be more cost-effective than Visa and Mastercard.”



Even a small increase in total sales can offset what might look like a meaningful increase in costs. Weighing those costs against the potential boost in conversion is a critical exercise for any retailer. Failing to do so risks leaving money on the table.



Using a Trusted Partner



Once a company commits to adapting its payment methods to each local market, the process can quickly become daunting. For instance, it can be difficult for a head of payments at a large global business in San Francisco to determine the right mix for customers in Italy or Taiwan.



“We work with the biggest retailers in the world, who have huge, sophisticated payments teams,” said Sykes. “I'm always surprised by how much they struggle with the complexity, because of the number of markets, and because the space is evolving so quickly.”



Apgar added: “There's so much buzz today about orchestration, optimization, minimizing cost, and maximizing effectiveness. A lot of merchants are tempted to want a direct connection to all these payment schemes around the world. But there's a learning curve, and time to market, and resources to be invested. There are a lot of mistakes to be made before getting to that optimized point. And a lot of times the fastest path is to engage with an expert partner like Worldpay.”



Payment partners like Worldpay help by giving merchants access to a growing portfolio of APMs through a single integration. This not only reduces complexity, but also lowers costs and eases the technical burden of connecting and maintaining multiple APMs.



BNPL Is a Worldwide Phenomenon



One example of a payment method with varying considerations across...