The Advantages of Using BNPL Options for Retailers
Even if consumers wish to spread the expense, retailers prefer to be paid immediately. Upon a customer’s purchase, a BNPL provider such as Klarna, Affirm, or Sezzle will quickly transfer funds to the retailer. Because of clever algorithms, these companies can bear credit risk for the store (paying them even if the consumer defaults) and the consumer. Everyone is safe no matter what occurs. Here are some of the critical advantages that shops will gain from implementing a BNPL option:
Brings in new customers.
The ability to try before you buy has long been a problem for online retailers — people like to feel the fabric between their fingers and see if the shoes fit before committing. Buy now, pay later specialists offer a great chance to make this work in the online space.
Through features like free returns and dedicated support staff, organizations using BNPL can lower entry barriers for consumers and give them flexibility when making purchases. It’s tempting to dismiss free returns as a waste of money, yet they quickly become a necessary business tool. According to a UPS survey, 66% of customers check return policies before making a purchase, and more than half of online shoppers avoid companies with strict returns. Businesses that view returns as an opportunity to improve consumer relationships are more likely to succeed.
Improved customer experience.
While it is true that Millennials and Gen Z enjoy shopping, browsing, and simple delivery, they, like everyone else, demand and expect a superior shopping experience. To attract and retain younger generations as clients, you must establish a platform equal to the challenge. That must happen before considering reward programs, loyalty schemes, or other nice-to-haves.
Sales have increased.
Purchasing a large-ticket item can be difficult, whether it’s the shock of such a large sum of money leaving your bank account or the potential of hefty interest rates on your credit card. That is one of the reasons why BNPL has a good impact on conversion rates. According to the Baymard Institute, the price was the most frequently mentioned reason for cart desertion. Offering payment plans can dramatically lessen price shock, encouraging customers to complete their purchases.
Increased customer lifetime value (LTV).
BNPL ultimately benefits consumers since it gives them greater flexibility and control over what and how they buy. Merchants gain new Millennial and Generation Z clients, increase recurring visits, and convert larger average basket sizes. Because a great purchasing experience is critical to client retention, positive experiences mean they’ll return again and again. Furthermore, once customers realize you have a BNPL option, they will return to you for their next big-ticket item.
