“Buy now, pay later” (BNPL) is all the rage now. With Christmas around the corner, it can be a key piece of the sales puzzle. This article shows you how retailers can integrate BNPL to get their stores ready.
Peak season and the 2022 Christmas shopping season are just around the corner. More than just the usual sales rush, it is also a time when online shops and brick-and-mortar stores reach the limits of their capacity. That is, at least when online and offline stores are not prepared for the increasing number of customers. Shoppers start looking for gifts as early as September. This is when online searches with the keyword “Christmas” begin to skyrocket, according to the Weihnachtsshopping Report 2022 from eBay Ads, a survey taking the temperature of some 2,500 German consumers before the 2022 Christmas shopping season kicks off. In the week beginning 20 September 2021, eBay recorded a 26-percent increase in product searches containing the term “Christmas”. In light of this, retailers should start getting their stores ready now for the increasing number of customers they can soon expect.
But it’s not just online shops that need to be prepared. Retailers should also ready their POS. After all, customers in brick-and-mortar retail expect the same smooth and accommodating customer experience as they’re used to in ecommerce. One aspect that excites many consumers, especially online, is the wide range of payment methods. So it’s important to make the same offer at the POS. The question is: How should retailers adapt the payment mix at their POS to meet the needs of their customers?
It’s no mere truism that payment has to be personalised. Customers expect to be able to pay in a way that suits their needs, as the ECC Payment Study Vol. 26 shows. And during the Christmas season especially, customers demand even more flexibility when it comes to payment options. According to the Weihnachtsshopping Report 2022, around a quarter of consumers still plan to spend between 101 and 300 euros on gifts this year. With higher spending like this common at Christmas, the right payment options allow shoppers to act flexibly and buy gifts earlier. In times when bottlenecks are throttling supply chains, it’s understandable that this trend is on the rise. Shoppers still want to have gifts for all their family and friends under the tree in time for Christmas.
When it comes to payment flexibility, buy now, pay later has boomed in recent years. According to the ECC Payment Study, for example, payment by invoice is one of the three most popular payment methods. It’s one retailers should not leave out of their payment mix, especially during the Christmas season. The ECC study also shows that nearly a third of customers will abandon their cart if the most popular payment methods aren’t offered. To ensure a good customer experience and increase sales, this means that retailers should integrate BNPL options – payment by invoice and payment in instalments – into their payment mix at the POS.
Ultimately, the payment mix is just as crucial at the POS as it is in online retail, as customers expect the same convenience in brick-and-mortal retail as they’re used to in the online world. Retailers should therefore employ modern BNPL solutions both online and offline to offer a new customer experience at the POS – one that is in no way inferior to online retail.
Paying by invoice at the POS lets customers first take their products home, try them out, and then only pay if they actually want to keep the goods. At Christmas, this gives gift-givers the advantage of being able to check out a potential present before committing to it – if they don’t like it, they can return it without having to wait for a refund. Besides simply increasing your customers’ financial flexibility at Christmas time, which they’ll be sure to appreciate, it also enhances the customer experience. Smart retailers will leverage this benefit to boost customer loyalty beyond the 2022 Christmas season. After all, customers for whom the purchase and return process is quick and easy are more likely to become repeat shoppers.
Instalment payments give shoppers even greater flexibility by lettings them pay for gifts over a longer time period. On the one hand, this allows customers to buy more expensive gifts. At the same time, it also increases shopping cart size and conversion rates for retailers. With inflation on the rise, paying in instalments offers customers more than mere flexibility. It helps ensure that, despite the ever-increasing strains on their wallets, customers can give nice Christmas presents that will bring a smile to the faces of their loved ones this year.
But retailers who want to offer their customers BNPL solutions in brick-and-mortar retail shouldn’t integrate just any solution into their payment mix. Why? It is not the mere presence of a BNPL solution at the POS that is decisive. What counts is how the solution is implemented. To ensure customers have the most pleasant customer experience possible when paying with BNPL, the solution should be simple, fast, and secure. In addition to effective data protection, mobile data collection and direct online credit checks that run in the background for invoice or instalment payments are crucial in terms of usability. This kind of BNPL solution means customers can leave the store with the product of their choice in the shortest possible time and pay later online at their convenience.
A white-label solution, in your shop’s own look and feel, can give your customers a heightened sense of security by foregrounding your company’s brand. This in turn also has a positive effect on customer loyalty: Customers will associate their positive experience of simple, fast, and secure BNPL checkout at the POS with the store itself.
The pre-Christmas shopping season is a time when customers want increased flexibility. And the current on-the-ground situation is fuelling this desire even more. Retailers who want to enable their customers to pay flexibly should prepare their POS now by integrating BNPL solutions. This is the best way to offer their customers the service they will be expecting when getting a head start on their holiday shopping.
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