Payments Orchestration as a market has been exploding in popularity in recent years. In fact, a recent study by The 451 Group in their “Voice of the Enterprise” series surveyed a panel of merchants. One of the sets of questions was around strategies for enabling and optimizing digital payments. A question in that series asked how many companies were looking to use multiple payment services as part of their strategy. Last year, the response was below 50%. In just one year, the same question yielded 60% positive response. That’s an amazing increase in just one year.
Before we get into details about what an ideal payments orchestration solution should look like, let’s answer the question of what payments orchestration actually is. The simple explanation is that it is an approach that leverages data and connections to multiple payment services in order to deliver the best possible payment experience to customers and the optimal revenue to the merchant.
That ability to deliver a great customer experience comes in because orchestration allows you to leverage the right payment service for your target geographies and customer profiles to increase the rate of successful transactions. That leads to more revenue in the short term, and longer positive relationships with your customers.
But what makes a great payments orchestration solution? What elements should you look for when considering a solution? Let’s take a look at the seven attributes that we recommend.
In a philharmonic orchestra, there are many parts played by different instruments. Percussion helps to drive things forward, strings bringing emotion and story-telling to the music, horns adding drama and intensity, and more. Each section and instrument has its own role to play in delivering great music.
It’s no different for your payment services. As we’ve seen in previous blog posts, the most popular payment service is not necessarily the most effective (highest authorization rates). And the same is true for other payment services, like say, a fraud tool. One may have great results in Latin America, while another specializes in high risk industries.
Relying on one solution to support you across all geographies, markets, and products is not ideal. It’s like having an orchestra with just the woodwind section (sorry, I have to keep the metaphor going!). It’s fine -- but it’s not the experience of a full orchestra!
A more effective approach is to bring the best services -- the right services for your go-to-market -- together to support your payments strategy. That might mean a mix of vendors in Europe, a set of fraud tools in another geography. Or even starting simple with two or three payment gateways.
Critically, you want to be able to access these services easily. With just a single connection to make the technical lift as simple as possible. And you want to access a full marketplace of services, not only gateways but other payment services too.
When you’re looking at orchestrating multiple payment services a first step is to see if your preferred services are integrated with the payments orchestration platform. If they’re not, of course you should reach out to see if they are on the roadmap or simply not listed. But having a vendor listed in a long menu of integrations is not enough. After all, you’re going to have a business relationship with these service providers, so you want more than just a connection point.
What you want is the knowledge that these integrations are built on solid business relationships. You want your payments orchestration vendor to have established partnerships with these services so that as things change in the market or with the product, or challenges occur, that your payments orchestration vendor is able to call on those nurtured relationships to support your business need.
Spreedly has offered payments orchestration since before it had a name. We’ve been building the most complete set of relationships with the world’s largest and leading payment services. That means you can count on our ability to support your preferred mix of payment services.
When you’re picking an orchestration vendor, you want to choose the organization that has the most momentum behind it. Just like with open source tools, there are a lot of advantages to going with the winner. Payment services want to focus their resources on supporting the winning platform with richer functionality and support. Peers in the industry are more likely to have experience with that platform and so can offer more support and ideas. Career-wise, it’s better for payments leaders to choose a platform that has more momentum not only because of the proven track record of the leader means a greater chance of a successful implementation. Plus, it means your experience is more portable.
So, what does a market leader look like? You should look at key attributes like funding raised (Spreedly has raised over $80 million). Time in market (Spreedly has been in business since 2007). And customers served (we’ll get to that). But another way to look at it is growth of transaction volume managed by the platform.
One industry analyst pegs the payments orchestration market as growing at 20% per year. Spreedly’s growth of transactions over our system is well over triple that. And when you put that into raw terms -- with an annualized GMW of north of $30 billion -- Spreedly’s leadership of the payments orchestration space is even clearer.
When looking at a payments orchestration solution you want one that has been proven at large, global organizations -- the most demanding payments environments in the world -- and at fast-growing merchants and platforms that expect flexibility. Plus, you want a provider that has customers in your region and domain. That could be a geographic region, like Latin America, or maybe a specialized domain like order ahead.
Spreedly has over 500 direct customers and tens of thousands of sub-merchants that rely on the service for their payments orchestration needs. These companies are pushing huge volumes of transactions through the platform. And they depend on the solution to process not just large volumes, but very spiky levels. For instance, a travel customer often sees a spike in travel in the lead-up to summer vacation. A delivery company sees heavy traffic on Friday and Saturday evenings. And a retailer sees a massive spike in the US on Black Friday and Cyber Monday.
Spreedly is specifically geared to handle these volumes from merchants and platforms. And we’re built for flexibility to support start-ups as they launch their products and move into scaling mode.
With the massive volumes and scale of customers that Spreedly has comes an unfair advantage that we share with our users. What is it? Well, a key part of payments orchestration is the idea of payment optimization. Optimization in part involves using data about past transactions to decide how to intelligently route them to reduce false declines and improve payments revenue.
That optimization is driven by many factors -- card type, geography, industry, and more. The more data you have at your disposal for analysis, the better your recommendations will be. And since Spreedly is the market leader, we’re aggregating huge volumes of data from around the world and across numerous industries.
That richness of data is transformed into smart routing recommendations that can dynamically route individual transactions to the ideal mix of payment services. And that advantage is only going to increase over time as our lead in the space grows. That translates into a better customer experience for your clients and more revenue to your coffers.
The payments world is a complex one. And as you alter your payments strategy to adapt to your business strategy, it’s important to have a supportive organization. That means a team that has access to large data sets, has seen payments orchestration models across many companies, and knows the challenges you face in payments.
Spreedly brings together the largest group of success, support, and consulting professionals focused on payments orchestration. That means you can leverage our expertise to support your strategy as you evolve and grow.
When you choose the right vendor for you, you want a provider that is going to keep developing new and innovative solutions that keep your growth going. You don’t rest on your laurels and you should expect the same from your providers.
That’s what Spreedly does. After all, we’re the innovators of the Payments Orchestration space. Whether it’s building out connectors to payment services beyond gateways, like fraud tools, etc. Or, it’s building out the first payment service provider-agnostic Network Tokenization solution. Or, an API-driven smart routing connector that returns recommendations through a simple call. We’ve got you future-proofed for wherever your payments strategy takes you.
We’re so sure that Spreedly is the right solution for you, that we’re inviting you to try it out now. If you’re a developer or want to invite one of your developers, visit spreedly.com/trial and test out the solution now with 100 free external API calls to get started.