ETA Expert Insights: Selling in a Crowded Marketplace – Guidance for ISOs

By: Maurice Griefer, Maverick Bankcard; Rick Rizenbergs, First American; and Andrew Cohen, CardWorks Acquiring, LLC, members of the ETA Payment Sales and Strategy Committee.

The payments industry is advancing at a rapid pace as new technologies and players enter the space quicker than ever. The industry is no longer characterized by traditional banks and ISOs; instead, processing companies have become more advanced and are able to offer a variety of features to their merchants.

At the same time, newer companies like Square and Stripe have entered the payments ecosystem, charming business owners with their ease of use and aesthetic. Amidst this competition, however, there are massive untapped opportunities. Given the advent of business software, POS systems, and sophisticated APIs, the payments ecosystem is rapidly evolving toward a more partner-centric business model.

Succeeding in this new environment requires a shift in sales strategy mindset. Below, we explore how to do this effectively in a crowded marketplace.

The fulcrum shift ‑ pivoting away from the price pitch

In the past, many ISOs sales and marketing strategies focused mostly on pricing. Sure, it’s an easy way to grab a prospective merchant’s attention, but we all know this strategy is a race to the bottom and not a long-term solution.

In today’s crowded market, however, it is imperative to rethink the sales pitch and develop one that is not so heavy on price. Business owners are most interested in finding ways to increase sales, build a more loyal customer base, prevent fraud, and seamlessly integrate multiple business applications. These business owner pain points make now the optimal time to hone in on your company’s strengths and redefine your unique value proposition. To stand out in this aggressive market, the key is to focus less on price and more on expertise.

With this new competitive and dynamic payments environment, ISO’s and agents must find their value and develop a knowledgeable and consultative salesforce to begin their shift away from the price pitch.

The winning strategy ‑ moving toward integrated partnerships

When you stop selling on price alone, you pave the way for improved merchant acquisitions, lower merchant attrition, and even increased revenues and profits. Reaching that point starts with an assessment of your company’s strengths, and then augmenting those through strategic, integrated partnerships with software providers and payment technology providers (e.g., processors). Furthermore, these software integrators are becoming increasingly influential in guiding business owners toward choosing payment solution providers.

By being able to sell on solving for the aforementioned business owner pain points, you create merchant loyalty that is tangible and long-lasting. This stands in stark contrast to the merchant services industry of yesteryear, which relied on little more than the promise of lower rates and fees.  Additionally, by striking a strategic partnership with these software integrators, you are aligning yourself with influential advisers in this evolving ecosystem.

For the forward-thinking ISOs and agents that have already embraced this change, top line growth has quickly followed. These results are linked directly to payment technology and data tools that address the business owners need for greater management oversight and a broader array of payment solutions that enhance the user experience for both merchants and their customers.

Selecting a Payment Technology Provider

In selecting potential business partners, it is prudent to perform your due diligence. Some integrated partners are becoming more payments savvy and are beginning to shop technology and price.  If the value a party brings is rather generic, don’t be surprised if you must give up margin or if the partnership fails to produce business.

It’s imperative to choose the payment technology provider that offers you the greatest flexibility; bigger may not always be better. Off-the-shelf payment product APIs may work for some business partnerships, but they can also limit the technology differentiation you need to compete. There are payment technology providers that, although smaller in size, have the standard product API integration tools but also have the flexibility to dedicate time and resources to solving challenging problems such as customized pricing methods and boarding process enhancements.

If you’re an ISO or agent that’s in a current relationship that doesn’t provide you with the tools, time, resources or flexibility to succeed, change to a solutions provider that can.

The path forward ‑ succeeding in your chosen sales vertical

To enter and succeed in a rapidly changing but crowded market, you need to establish a presence to have any chance of competing with the leaders. One of the smartest ways to quickly establish a presence is by targeting one vertical and learning everything about it.

Differentiate yourself by offering products and technologies that are specifically tailored to that vertical. This is your unique value proposition and will help you stand out in a competitive marketplace, allowing prospects to see your business from a different perspective when compared to the competition.

Once you establish a clearly defined market and your unique offering in it, make a concentrated effort in attacking that vertical from every aspect: sales, marketing, advertising, business development, pricing, etc.

Become known to prospects in that vertical you are targeting and show them the value you can add through what you know and what you offer. The more your specific market learns about how you can help them and why you understand them, the more willing they will be to listen to what you have to say. This can be accomplished through conference and trade show involvement, as well as partnerships with purchasing groups and industry influencers.

By being the expert in a targeted vertical, you will not only help grow your business but will also enable you to develop products and solutions to your client’s specific needs as well create a better customer experience.

Focus on customer experience

Of course, making your mark and carving out your niche expertise is just the start.  To keep and build a competitive advantage, you should also focus on the customer experience (not to be confused with customer satisfaction or customer service).

Customer satisfaction, customer service and customer experience are very different. Customer satisfaction is the measure of how a company’s products and solutions meet, surpasses, or fails a customer’s expectation.  Customer service is the advice and assistance provided by a customer representative to the people who buy or use its products or services. Customer experience is the entire interaction a customer has with a brand and its products and begins even before someone becomes a customer. It’s a process that starts the moment someone learns about your company and is a key competitive differentiator that merchants consider when deciding which payment technology provider to choose.

It is clear that the future of the payments industry is becoming more difficult to predict. With an ecosystem of constant change, we can agree that it is essential for companies to be flexible, maintain a unique value proposition, and focus on updating their sales strategy to thrive in today’s market. There is no better time than now to reevaluate your company’s goals to achieve success in our increasingly crowded marketplace.