The following is a guest post from Brian Greenfield, CFO at BlueSnap. Opinions are the author’s own.
In addition to overseeing and managing all aspects of a business’s financial health, CFOs are increasingly expected to assume greater leadership roles in strategy development, value creation, revenue growth, and the pursuit of enterprise-wide operational excellence.
To meet the evolving challenges and expectations associated with the role, CFOs rely heavily upon a wide range of intelligence, analytics and sources of data from across the business to analyze strengths and weaknesses, identify areas for growth and savings, spot outliers in performance and unlock opportunities for improved profitability.
If payment data is not part of this mix, CFOs could be missing critical inputs that can contribute to a more fulsome understanding of business performance. Insights derived from payments and transaction-related data provide valuable intelligence related to customer experiences and spending behaviors that can be used to predict future performance. These insights can also reveal opportunities to increase revenue and reduce costs.
For CFOs not already leveraging payment data in their financial and operational analysis, these are some of the reasons they should be.
1. Optimized payment processing reduces costs
Enterprises typically grow sales and revenue by developing new products and services and ensuring they can be delivered to as many customers as possible in a growing number of geographies. However, CFOs know all too well that balance sheets can also be improved by reducing costs.
Global businesses spend handsomely on payment processing charges, especially as growth and expansion occur, with credit cards, debit cards, ACH and the glut of alternative payments each having different costs in the various countries around the world.
By accessing and using payment data to understand where and how the business is spending money on payment processing fees, CFOs can unearth ways to strategically adjust and optimize the routing of transactions to ultimately improve efficiencies that can lead to significant cost reductions.
2. Increasing authorization rates drives revenue
CFOs are also constantly looking for opportunities to increase revenue, especially when resources needed for continued product development may be in short supply. Reducing transaction authorization failures can dramatically reduce lost sales and boost the bottom line.
Analysis of payment data can help CFOs identify where and why failures are happening and act quickly to take the necessary actions to address and improve the transaction process, including potentially moving to a new payment platform that offers a more seamless experience for customers and more capabilities to detect fraud, often a key trigger for a declined transaction.
3. Informing enterprise-wide investments and strategies
Payment data, and the insights contained within, can help CFOs understand why a customer transaction process was ended and deploy strategic and technical changes that increase the likelihood that a customer will complete a transaction in the future.
This could include changing the website or marketplace, so buyers are seeing prices in their local currency, investing in local acquiring capabilities that allow for payments to be processed in the region where the buyer resides, or deploying automatic failover technology where a failed payment is immediately rerouted to another bank.
CFOs and finance teams can use payment data in this way to instruct changes and introduce new technology to the business that positively impacts revenue.
4. Combinable with business intelligence and analytics
Many CFOs already have enough data to sift through and decipher. They might be resistant to add even more analytics to the mix. AI and machine learning solutions enable enterprises to capture and aggregate data from multiple business intelligence sources and deliver intelligent, actionable insights that can be leveraged to help the business grow.
When joined with other sources of internal data, payment data can be a powerful additive that enables CFOs to have a more complete picture of customer satisfaction, revenue and costs and contribute to real-time data-informed decisions.
Strategic planning and financial forecasting are obvious and significant parts of any CFO’s job. Payment data is another tool that CFOs and finance teams leverage to further monetize existing customers, broaden their suite of services, optimize resources, maximize cost savings and accelerate revenue growth.
