Updated: Jan 4
Lately we hear a lot that e-commerce is the future, that online corporations are making a lot of money, that physical shops won't survive after COVID-19 and so on.
That might be true, even for shops that are on the adult industry, like Stuffgoodies.
However, all the growth on web stablished business , such as sex shops online, has not really been understood by the super technological payment gateway providers.
Basically everyone makes it difficult for the businesses in the adult industry to grow. We can't really advertise on social media, I mean paid advertisement, where everyone is. And most of the times, payment gateway providers won't allow sex store's customers pay with their credit or debit cards.
Most of the payment gateway providers have really strict policies prohibiting adult shops' merchants to offer their customers smooth payment solutions that they can enjoy on their beds, at home, because they consider the sex industry as a risky business.
Which is controversial! Try to Google for example: sex toys and COVID-19. You will see thousands of articles stating that during these lockdown times, sex toys shops online are making cash that they have never made before. So people are buying and using sex toys, it's not prohibited, by the way most of us come from intercourse... And hence, it's hard to understand why the payment gateway providers think this type of business is so risky. Are they just old fashioned?
So, what's a payment gateway?
A payment gateway is the technology that captures and transfers payment data from the customer to the acquirer and then transfers the payment acceptance or decline back to the customer. It acts as an interface between a merchant's website and its acquirer.
Sounds simple! But here in Stuffgoodies, besides being banned by one of them, we have tried to subscribe, engage, become a partner, WHATEVER, with around 20 of them. And it's not like all of them are located in Silicon Valley. It's not an American thing. We have tried providers in Latin America, Asia, Europe..basically in all the continents. And we end up getting the same answer: "Unfortutely, due to the industry you are in we are not able to provide our services to you!"
All in all, there is still a light at the end of the dark tunnel. It's called Paypal! Paypal really doesn't
care what you are selling. Unless you are a criminal! Rates charged can be higher than what's practiced in the market and the other downside of Paypal the customer has to have or has to create a Paypal account in order to pay for the order. Which can generate a lot of abandoned carts to the merchant using this platform. But there is no discussion that Paypal is the most popular payment gateway worldwide. Currently, is the only payment gateway we have available in our e-shop and then My Dear Customer, if you are in our shop and found something for you, please proceed to the Paypal registration. You will make us happy!
Our sex store is hosted by the wealthy website builder for e-commerce, Shopify, and we have a premium subscription! Shopify offers great solutions, plug-ins etc. Still... we struggle.
We have tried most of the payment gateway providers offered in Shopify, and here an overview of our experience. Note that most of the providers don't provide payment gateway for adult industry.
Stripe - This payment gateway is the first third party payment gateway recommend by Shopify. If you are not able to use Shopify
Payments, Shopify will first recommend Stripe for you. So we went for it. After a couple of months operating, they asked us to review our web shop. After reviewing it, they asked us to delete some of our products such as vaporizers, e-cigarettes and CBD products. We were not happy but we did it. Another couple of months passed and they suddenly just suspended our account. During the last 6 months, they were not providing the services for free OF COURSE! They made some money on our behalf, and still they just sent us a cold message: Unfortunetly.....
And then, our saga started! After many no's and A LOT OF frustration. There was even this Latin American payment gateway called DLocal, that charged in advance a set up fee, BEFORE analyzing our website and when finally they managed to start the set up, found out that we are a sex store. Seriously? Now I am almost offering them a free sex store item (probably a butt plug) , in order for them to refund the set up fee.
After Stripe, we spent one month trying to find a payment getaway to Stuffgoodies. And FINALLY, we met Clearhaus a Danish, open minded payment gateway provider that accepted to sign a contract with us, still we had to remove some of product in order for them to accept. By the end of this blog post, they still haven't banned us. It's still not working though, because we have to set the 3D-secure, which is a required solution in the EU, to add security on the transactions.
To be honest, the only payment gateway that has not restrictions for adult content or products is PayPal. The downside of PayPal are the high fees and of course that our customer would have to have a PayPal account, which is not convenient if one of the ways to get customers to buy is by impulse.
But hopefully soon, we will then be able to accept credits and debits cards again.
To end this up, here is a thought of wisdom: Before getting into the adult industry. DO YOUR HOMEWORK!