For Retailers, a Direct Link from ‘Buy Now, Pay Later’ to the Bottom Line

Most corporate growth strategies are grounded in plans to enter new markets, launch new products, acquire another company, or enhance the customer experience. At the same time, companies have to negotiate an increasingly complex global digital economy where tech-savvy consumers have limitless shopping choices and higher expectations than ever before. As retailers jockey for customers, they should consider one growth tactic that can help meet consumers’ need for flexibility and increase conversion: updating checkout to offer more-flexible payment options.

Today’s online shoppers expect a range of payment choices. A 2021 TRC Market Research survey of ecommerce customers in the United States, the United Kingdom, Germany, France, and Australia found that the majority of shoppers decide how they’re going to pay for a purchase before they check out — and “buy now, pay later” (BNPL) payment options offered earlier in the shopping journey can help influence their decision to buy. 1

Unsurprisingly, the fintech industry has taken notice. In 2020, spurred by the financial shock of the pandemic, demand for BNPL increased substantially,2 and a host of new providers quickly emerged to meet it. While the pandemic is subsiding, enthusiasm for paying by installment remains high across customer segments.2

It looks like BNPL is here to stay. And to remain competitive, retailers need to know who uses it and why — and how offering it can help them increase sales.

Not Just for Millennials

BNPL is often associated with Millennials,1 but today’s BNPL has broad appeal across demographics, from Gen Zs to Boomers. Despite some country-by-country variations, the TRC survey revealed significant uptake across all age segments:

  • Millennials (ages 25-40) are the biggest users of BNPL, with usage ranging from 37% in France to 49% in the United States.3
  • Many Gen Xs (ages 41-56) also choose BNPL — from 25% in the United Kingdom to 33% in the United States.
  • Younger and older generations are catching up, with more than 18% of Gen Zs (ages 18-25) and 11% of Boomers (ages 57-70+) using BNPL.

From young people settling into adulthood to retirees entering the next phases of their lives, interest-free credit options seem to be playing an increasing role in people’s purchases.2

The Broad Appeal of BNPL

Consumers see many advantages to using BNPL. The most common are:

  • Flexibility and convenience. The popularity of BNPL parallels a rise in the “subscription lifestyle” trend. Consumers like the convenience of automated monthly payments for streaming services, meal delivery plans, and curated fashion shopping. Even some airlines, recognizing that consumers enjoy a “set it and forget it” payment schedule, are exploring subscription travel plans.4 BNPL offers similar consistency and transparency — automated repayments on a set schedule — as well as convenience.
  • Appeal to a wide range of consumers. At least half of the TRC survey respondents in all five national markets said that spreading the cost of a purchase allows them to make better purchasing decisions.1 This means BNPL may help retailers reach a wide range of shoppers who will purchase higher-quality and valued goods because they can pay over time. This can help increase revenue and average order values for retailers.
  • Budgeting and cash flow support. While it may at first seem counterintuitive, many consumers use BNPL to help manage their finances and improve their financial health. In the TRC survey, 76% of respondents reported using BNPL to budget and manage cash flow1 — a practice especially appealing to digital natives who may use investment and budgeting apps such as Ellevest and Acorns.5 Knowing the payment schedule and costs associated with BNPL when a consumer uses it to make their purchase makes it easier for them to manage their cash flow.
  • Streamlined application and approval. Shoppers can quickly access BNPL as part of the checkout process, without a lengthy approval process. They can get the flexibility to spread payments over time and the satisfaction of receiving purchases quickly.

Helping Retailers Grow Sales

Retailers, meanwhile, find that BNPL helps drive both sales and customer loyalty. The TRC survey revealed three major advantages:

  • Conversion boost. Consumers paying with BNPL were up to three times more likely to complete a purchase after browsing.1
  • Bigger average cart size. BNPL users may be more likely to pull the trigger on big-ticket items. The most common purchases are clothing and shoes, while purchases of electronics, appliances, and other durable goods also raised the average basket size. Samsonite added a BNPL option in fall 2020 and saw a 25% increase in the average value of orders made through its leading payment provider in 2021.6
  • Fewer abandoned transactions. BNPL has become so much more commonplace that the absence of a BNPL option may turn off buyers. At least half of BNPL users in each country surveyed (66% in the United States7) said they would abandon a purchase if BNPL wasn’t an option.

Fortunately, retailers have the ability to build the trust that shoppers require to maintain the customer-company relationship. The TRC survey found that at least 64% of consumers in France are more likely to trust a retailer that offers their preferred payment option.1 Retailers also play a critical role in raising awareness of BNPL and expanding the use of it; 74% of BNPL users in the United States have been prompted to use BNPL by a message delivered on a retailer’s site while they were shopping.8

Finding the Right BNPL Partner 

Retailers can choose from a long list of BNPL providers. Look for one that can deliver the seamless transparency consumers expect, with a track record of efficient, accurate, high-capacity transaction processing. Demonstrated investment in enhanced data security is also crucial. For instance, in Australia, 60% of BNPL users would abandon a purchase due to security concerns.9

A provider that meets all these criteria delivers a win-win for retailers and customers alike: Consumers acquire what they want on preferred terms, while retailers increase their ability to energize growth, convert browsers to buyers, and garner greater customer loyalty from BNPL believers.

Find out how PayPal can help you integrate Pay Later options for your customers.




[1] TRC study, commissioned by PayPal, April 2021. TRC surveyed 1,000 consumers 18+ in each of five countries: the United States, the United Kingdom, Germany, France, and Australia.

[2] Ron Shevlin, “Buy Now Pay Later: The ‘New’ Payments Trend Generating $100 Billion in Sales,” Forbes, Sept. 7, 2021, accessed April 29, 2022.

[3] TRC, commissioned by PayPal, April 2021. TRC conducted 20-minute online surveys among 1,000 consumers ages 18+ in Australia (among BNPL users, n=447). TRC conducted 20-minute online surveys among 1,000 consumers ages 18+ in Germany (n=342). TRC conducted 20-minute online surveys among 1,000 consumers ages 18+, including ~300 PayPal BNPL users, in France (n=255)​. TRC conducted 20-minute online surveys among 1,000 consumers ages 18+ in the United Kingdom (n=303). TRC conducted 20-minute online surveys among 1,000 consumers ages 18+ in the United States (n=282).

[4] Josh Rivera, “The newest subscription service: Flights. Would you do up to 24 roundtrips a year for a monthly rate?,” USA TODAY, Feb. 17, 2022, accessed April 29, 2022.

[5] Maryalene LaPonsie, “How 7 Financial Tools and Services Simplify Life for Millennials,” U.S. News & World Report, July 27, 2018, accessed April 29, 2022.

[6] David Oksman, Samsonite, VP of Marketing and eCommerce, et al., “BNPL: The Millennial Payment Method Comes of Age,” The MoneyPot podcast, Jan. 25, 2022.

[7] TRC online survey commissioned by PayPal in April 2021 involving 5,000 consumers ages 18+ in the United States, the United Kingdom, Germany, France, and Australia (among BNPL users, U.S. (n=282), U.K. (n=303), Germany (n=342), France (n=255), and Australia (n=447)).

[8] TRC online survey commissioned by PayPal in April 2021 involving 1,000 U.S. consumers ages 18+ (among BNPL users, n=282).

[9] ACA Research, PayPal Australia eCommerce Trends Report 2021 (commissioned by PayPal Australia).






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