In today’s fast-paced and competitive market, payment analytics is one of the best ways to get a leg up on your competition. That’s because payment analytics metrics allow you to see your financial performance and customer spending patterns in real time. With this information, it’s much easier to make data-driven decisions that optimize cash flow.

Of course, implementing this technology is a little more involved than opening an app. Here are four surefire tips that will help you use payment analytics to improve your business!

1. Identify Common Payment Methods

One great use case of payment analytics is identifying trends in commonly used payment types. For example, seeing trends in credit vs. debit card usage can help you negotiate more cost-effective processing rates. Meanwhile, an increase in specific mobile payment methods, such as NFC payments, can indicate it’s time to invest in additional mobile terminals.

Examining payment trends also streamlines operations. If you see that manual payments over the phone are taking a toll on your staff, you may consider using self-service payment portals.

2. Create a Better Customer Experience

These days, customers have high expectations of businesses. If you want to maintain a steady rate of getting new customers and retaining existing ones, you must make them feel valued. Payment analytics can help you do that by offering you a look at their chargeback rate, preferred payment methods, and other important insights into their buying behaviors.

These behaviors will usually point to the specific issues with your customer experience. This can be anything from poor product quality to an unsatisfying unboxing process.

3. Increase Customer Loyalty

Encouraging repeat business is equally important as gaining new customers. Fortunately, it’s very simple to track whether someone is a new customer or a returning one. Combining this data with their purchase history gives you a clear look at their spending trends. You can use this data to steer your customer engagement initiatives and target your marketing efforts.

Let’s say the rate of your repeat business seems to be slowing down. You may respond by crafting better loyalty programs to encourage existing customers to come back.

4. Improve Fraud Detection

Though the revenue lost to payment fraud is on the decline globally, this is still a very real threat to merchants. Payment analytics help you avoid becoming a victim by identifying unusual patterns in your transaction data. For instance, multiple failed transaction attempts and sudden spikes in transaction volume are common indicators of suspicious activities.

Modern fraud detection tools use analytics to calculate a risk score, with higher scores making fraud more likely. This is a simple way to spot fraudulent transactions before they impact you.