[orangea]

> targeted specifically high ticket items (jewelry, luxury)

My immediate instinct upon reading this is "of course those businesses wouldn't be interested". They are selling a brand and image first, and if it looked like they wanted people to download some new app and put in their bank details to make a purchase instead of swiping a credit card it would cheapen the brand. Luxury stores are all about a streamlined experience and the appearance that money is no issue.

[lmm]

Yeah. High-margin, high-end businesses can afford the fees. If there's a space to compete it's low-margin businesses where 3% really stings, even if it's 3% of a smaller gross. I used to work with a company that served mainly immigrants and blue-collar workers, and something lower-fee than credit/debit was a constant conversation (we were partway through building an ACH backend by the time I left, but I don't know if that ever made it into production given concerns we had).

[rprend]

We tried with SMBs (it was our original focus, low net margin businesses). But 1. Deployment times are way worse in person, 2. Merchants still actually didn’t care (they said they did! But there was no strong need). 3. conversion at checkout is lower for small tickets than high tickets.

SMB business model just didn’t work, with tons of white glove customer support needed for a customer we’d make $20-$50/month in fees

With high ticket sellers the purchases are high intentionality enough that you can convert customers.

[pzo]

Not only only low margin but even more low price products. If you sell ice cream for $1 there is not only 3% fee but also minimal transaction fee like 30cent.

[aworks]

I recently made a purchase in an Ontario used book store that only took debit cards and cash (and the clerk was behind a COVID shield). Today I went to a used book store in Buffalo, NY that took credit cards (and the clerk was roaming around the store). Somehow that openness and lack of friction got me to buy more books for much more money. And I would gladly return...

[anal_reactor]

I think when the guy mentioned he studied past failures it's prime example of crunching the numbers and applying theories without actual common sense. "Ah yes, I wouldn't buy a Gucci bag for $999 but for $995 it's a deal done" you don't need PhD in economics to realize this is stupid.

The fact that the second part of his comment is full of acronyms "we ASDFed the GHIJ over KLMN" suggest it's yet another case of a manager completely detached from reality of average consumer.

[rprend]

Haha i wish i were just a bean counting manager. A number of venture backed startups have tried exactly this idea, and it was a tarpit.

Confused about your hate of acronyms. The bank rails are a practical limitation on how effectively a startup can compete in this space. Do you feel the same hate when people use technical terms about coding eg “we deployed with Kubernetes on AWS”?

[rprend]

This is ecom, not in person, and we found these places are brand agnostic about payments— they don’t control the look/feel of PayPal, Klarna, etc. And for every Hermes, there are a dozen luxury merchants less anal about the brand.

White labeling the payments infra as “their pay” did intrigue them, but not enough