What Payment Processing Has to Do With Digital Marketing

When a business owner brings me in to look at their marketing, they're usually thinking about what they want more of. 

• More people finding them on Google.
• More website traffic.
• More calls, appointments, leads or sales.
• More repeat customers.

Over the years, I've worked with all kinds of local businesses, including :

• plumbers
• electricians
• HVAC companies
• dental practices
• restaurants
• coffee shops
• hairstylists
• tattoo artists
• cannabis businesses

Their businesses are very different, but many of them have something in common: they accept card payments.

And the more closely I've worked with these businesses, the more I've started paying attention to something that isn't traditionally considered digital marketing:

What is this business already paying to collect the revenue it generates?

I've worked with local service businesses where the owner can tell me what they charge customers, what their rent costs, what they're spending on advertising and what software they're paying for.

But ask what percentage of their credit and debit card sales they're actually paying in processing fees each month?

A surprising number don't know.

They know they use Toast, Clover, Square or another payment system. They may remember the processing rate they were quoted. They know fees are being deducted.

But they haven't pulled out a recent statement and calculated what they're actually paying.

And I've started asking for that processing statement much earlier.

In some cases, I'm asking for it before I even get access to:

• Google Search Console
• Google Analytics
• Google Ads
• Google Business Profile

Those accounts are still very important. I need them to understand how the business is being found, where traffic is coming from, what people are doing on the website and what's happening with paid advertising.

But before I start getting into how we're going to generate more traffic, leads, appointments or sales, I want to understand something much simpler:

What is it already costing this business to collect the money it's making today?

Because if I can uncover an opportunity to reduce an existing expense before we've generated a single additional customer, that's worth looking at.

And there's another reason this matters to me.

I've talked to plenty of business owners who know they need help with their marketing and website but are already stretched financially. They know they need to improve their visibility on Google, get more from their website, follow up better or make better use of the technology they're already paying for. But adding another monthly expense isn't always easy.

So what if we can find savings somewhere else in the business first? 

If a business is able to reduce what it's paying in processing fees, the savings could potentially be hundreds or even thousands of dollars a month, depending on how much the business processes and what it's currently paying.

In some cases, those savings could offset some or even all of what the business spends to get help with its digital marketing.

I'm not saying every business will save money or that the savings will cover the cost of working with me. But I'm going to look!

Before I ask a business owner to find more money to invest in digital marketing, I want to know if there's money they're already spending that they may not need to be spending.

Why Am I Looking at Payment Processing If I'm Working on Digital Marketing? 

Because I don't look at digital marketing in isolation.

If I'm working with a restaurant, for example, I may eventually be inside Toast looking at what they're already paying for and what they're actually using.

• Is SMS available?
• Is email marketing set up?
• Are automated campaigns running?
• Are automated push notifications running?
• Is loyalty being used?
• Are they collecting useful customer information?
• Are there features they're paying for that nobody has configured?
• Can we use what they already have to bring customers back more often?

I take the same approach with other businesses.

Before I recommend another platform, subscription or advertising expense, I want to understand what the business already has, what it's paying for and what's actually being used.

Payment processing became another part of that review.

Now that section adds something new rather than ending with another version of “I want to know what it costs to collect the money.”

The Rate You Remember Isn't Always the Number I Want to See

A business owner might tell me: “I think we're paying around 2.9%.” 

Okay. Let's look at the statement.

I want to know the total card sales processed for the month and the total processing fees actually paid.

From there, we can calculate the effective processing rate: Total Processing Fees ÷ Total Card Sales × 100

If a business processed $50,000 in card sales and paid $1,750 in processing fees, its effective processing rate was 3.5%.

And I don't want to stop at the percentage.

$1,750 a month is $21,000 over 12 months if those costs remain similar.

Now we're looking at the actual dollars leaving the business.

That's Why I Partnered With Valued Merchant Services

Payment processing isn't my area of expertise, and I'm not going to pretend that it is. 

My job is to look at the bigger picture.

I'm looking at the website, Google visibility, traffic, conversions, follow-up, customer data, email, SMS, retention, technology, partnerships and other places where a business may be missing opportunities or spending money without getting enough from it.

Once I started paying closer attention to processing statements, I realized I needed a payment processing partner who could go deeper into the numbers when something deserved a closer look.

That's why I partnered with Valued Merchant Services.

Now, when I see something on a processing statement that needs a deeper review, I have someone who works specifically in payment processing who can analyze it.

The first step isn't changing processors. It's understanding what you're currently paying.

There may be an opportunity to save. There may not be. Either way, I want the business owner to know what those card transactions are actually costing the business.

Before You Spend More Money Trying to Make More Money 

If your business accepts credit and debit cards, pull out a recent processing statement.

Look at your total card sales and your total processing fees.

Do you know your effective processing rate? Do you know approximately what those fees are costing you over an entire year?

I created a free Payment Processing Cost Calculator on Mastering P.O.P. that lets you enter those two numbers and see both.

And if you want someone to go deeper into the statement itself, you can request a free statement review through Valued Merchant Services. 

You may find an opportunity to save. You may find that what you're paying makes sense.

Either way, now you know.