Is Dash as a payment method suited to ecommerce?
Recently I decided to ask the DASH community some important questions regarding it's new DASH Evolution platform and the current roadmap.
I've have been planning to submit a proposal to the DASH network that would facilitate merchant integration and onboarding onto a Dash Marketplace since it was mentioned in the official roadmap so I posted the question "Will DASH Evloution be Shoppable?" in the DASH forum (see link below). I wanted to assess whether there was an ecommerce strategy in place and how it planned to integrate DASH into the existing ecommerce model of online shopping.
I have an academic background in business and economics, I also have over 5 years experience in ecommerce as a certified developer for one of the biggest ecommerce platforms. I have worked on dozens of integrations for young ecommerce startups offering ERP or payment solutions to more established payment methods. I have spent countless hours AB testing , debugging, fixing, patching and figuring why some things just don't work in merchants checkout page.
After some serious thought I have come to the realization that digital currencies such as DASH and others, as fantastic as they are, may not be suited to the current ecommerce model and any attempt to offer them as a payment method may be futile. The reason for this is simple, when it comes to shopping online the current ecommerce model was built to work with credit cards. Yes, we might find a way to bend the current model and force users to shop with digital currencies but that leaves the merchant with the task of taking on this new approach while risking interference with their current checkout flow in order to change customer behavior. The training that would be involved to get customer service staff knowledgable about wallets and private keys will be costly and not guaranteed to increase the bottom line through increased conversions and higher cart totals.
Put simply if digital currencies as a payment method cannot adequately claim to increase conversions, and there doesn't appear be massive demand for it from customers then very few merchants will want to add as a payment method to their checkout page. In ecommerce the checkout is the holy grail and everything that is added or removed from it is for the sole purpose of increasing cart total and conversions - nothing more!
There's also, logistical reasons that haven't been solved in terms of reconciling a DASH payment against the local currency of the business. Suppliers and staff will still need to be paid in fiat but businesses face losses due to the volatility on any given day, hour or minute.
So what's the solution Evolution?
I have been speaking with a few people over in the DASH Slack channel and putting forth some ideas, I found it worrying that the focus was solely aimed at merchants current checkouts by adding a widget of some sort. This approach might seem acceptable for some merchants (Bennies barbecue sauce store) but for larger enterprise merchants I think more needs to be done to gain widespread acceptance.
My questions were:
1. Will Dash Evolution be shoppable with an ecommerce layer?
2. How is Dash proposing to onboard merchants? Will the platform be Plug n Play or are they expecting merchants to migrate to Dash Evolution?
Let me first define "shoppable" this is a relatively new term within the ecommerce space which came about when I was working for a publishing company that was making the transition to ecommerce. The goal was to make one of it's top fashion magazines "shoppable" by creating an online shopping experience that mirrored it's top publication.
Now, the responses to the question were again worrying from my point of view as they all came from a position of a lack of understanding about how and why ecommerce works the way it does. I think it is a misguided belief that merchants would start to accept DASH because it is decentralized and there are lower fees and you can be your own bank - I get that but the point was missed entirely. A merchant only cares about conversion, everything from page load times to the color of the "Place order" button can have an impact on conversions. So for a merchant to add DASH they would have to be presented with compelling evidence that the solution has been optimized for conversion and will out convert the merchants current payment flow.
In order to do this DASH has to provide data but it has none. Moreover, how many customers that shop at a given merchant (say Levis) actually use DASH in the first place to warrant it being added to their checkout page? Furthermore, who is going to train customer service staff about what a crypto/digital currency is? How will my accounts team reconcile my accounts in order to pay my suppliers and staff?
It gets a lot more complicated than just adding a new payment method to the checkout doesn't it? This is why merchants have not adopted any of the hundreds of Crypto currencies because the current ecommerce model works perfectly - USD, GBP and EURO etc!
Where can I spend it?
I'm always asked this question whenever I send DASH to friends and family. Therefore, I decided to ask DASH about onboarding merchants onto a marketplace that sells our favorite brands in DASH in order to prove the concept of digital currencies as a method of payment in ecommerce, and to answer the question "Where can I spend it".
Possible ways to achieve adoption:
DASH needs it's own credit card linked to it's Evolution platform that can be funded with USD from a users bank account using a Fiat gateway
Existing Payment methods need to accept DASH as a currency and use "DRK" as the ISO code
Build a marketplace so existing DASH users can start spending DASH and have somewhere to refer people whenever we're asked "Where can I spend it".
If a Payment integration is desired DASH should act as the method to transmit DRK but instantly settle in a merchants preferred currency.
Other examples of having your own ecommerce platform
Similar to Steemit which built its own blogging platform to attract bloggers rather than go after Wordpress, Drupal and Joomla seeking to add payment widgets to their blogs. DASH should consider building a marketplace platform and attract merchants to sell their goods and services as it will not interfere with their core business. If this is successful, the conversation about adding DASH as a method will be easier since there would be sales data to back up the claim that there is demand.
This is how PayPal became ubiquitous among online stores because eBay and made it the method of payment on it's own ecommerce platform first. As growth in online shopping continued individual merchants saw the benefits of adding PayPal as a payment method to their websites as "the network effect" guaranteed customers would convert well.
DASH has a very ambitious project and I believe that they will get it right but I hope they don't make too many mistakes and lose the confidence that early adopters have in the project.
My initial thoughts were that a marketplace was going to be clearly defined in the roadmap but when I saw that it wasn't clearly defined I decided to reach out to ask why?
The feedback I have got is the Evolution platform will be able to handle a greater number of transactions so it looks as thought the foundations are being laid down for a robust payment infrastructure so I'll hold off on my proposal and give them a chance.
Please if you have any thoughts leave them in the comment below?
Link to forum post:
https://www.dash.org/forum/threads/will-dash-evloution-be-shoppable.15648/
Link to DASH Evolution roadmap
https://github.com/dashpay/dash-roadmap/blob/master/README.md
Link to The network effect definition
http://www.investopedia.com/terms/n/network-effect.asp