The benefits of knowing how to offer buy now pay later (BNPL) in your retail store continue to grow.
BNPL is a system of payment where the customer makes the first payment at the time of purchase, and then pays the rest of the cost later. In contrast to layaway, customers can take the item home at the time of the first installment.
BNPL’s instant gratification makes it more likely customers will purchase additional items, and at a higher price point. Because of this, many retailers offer it both online and in-store. However, BNPL is especially vulnerable to fraud because fraudsters can take the merchandise with a single, small payment that is less likely to trigger red flags or attention from businesses or card holders.
Because of this, you must now know how to offer the flexible BNPL financing options that customers demand safely.
If you are thinking about how to offer BNPL in your retail store, here are the top three things to take into consideration.
Table of Contents
- Choose the right type of financing (and partner) to offer BNPL in your retail store
- Advertise BNPL offers early and often
- Advocate for how you offer BNPL across digital and in-person channels
- Get The Most Out Of How You Offer BNPL In Your Retail Store
1. Choose the right type of financing (and partner) to offer BNPL in your retail store
eMarketer found that 72% of shoppers abandon carts due to high costs. By offering BNPL in your retail store, shoppers can purchase the same goods but pay less up front, so that $800 cart is suddenly far more palatable when only $200 is due today.
When your customers mostly make smaller purchases of a few hundred dollars or less, a pay-in-four option is probably best. But for large-ticket items like furniture, longer-term loans, like $100 a month over 12 months, can increase completed sales, average cart value, and return customers. Also consider whether interest will factor on short-term loans and the provider’s average approval ratings – as few customers return to shops that have huge interest rates or that advertise BNPL but only approve a few buyers. Choosing the BNPL partner that offers the right financing option for your customers’ needs will help ensure desired outcomes.
But don’t forget to consider your own business needs: A BNPL solution that will require significant back-end work on your website is rarely the best choice, especially for small businesses. Instead, choose a solution that integrates easily into eCommerce sites with a short code added via the API.
2. Advertise BNPL offers early and often
Offering BNPL in your retail store has a proven track record not only of increasing cart sizes but also of attracting new business. If current and potential customers know that flexible financing is an option at retailer A but not at B, they’re more likely to choose retailer A and will likely spend more, knowing that the initial purchase costs are lower than the ticket price.
Investing in advertisements on social media or AdDaptive and creating dedicated landing pages that advertise BNPL options at your shop can have a great ROI. On your eCommerce site, promote financing options on each product’s description page as well as in the cart area of the site. Getting your shop listed on your BNPL provider’s site can also help advertise your business, as many customers choose merchants who will accept their preferred payment method.
And don’t forget to take advantage of seasonal promotion. Running the same ads year-round will have diminishing returns. Dedicated advertising for big buying occasions like Black Friday and Memorial Day sales helps catch customers’ eyes and integrating messaging about your BNPL options in your copy or hashtags can help draw in business.
3. Advocate for how you offer BNPL across digital and in-person channels
Many BNPL options like Apple Pay allow for both online and in-store processing. Offering a seamless experience does even more to decrease abandoned carts and increase total spend per transaction.
When you offer BNPL in your retail store, especially through NFC-enabled terminals, make sure employees are trained both on how to operate/troubleshoot the system but also on how to advertise it to customers. You can help your staff by investing in physical advertising around your store, like countertop decals, signs in fitting rooms, or window clings on store entryways.
Get The Most Out Of How You Offer BNPL In Your Retail Store
Once you’ve picked a BNPL partner that is compatible with your eCommerce site, use these tips to get the most value from offering BNPL:
- Join lists of retailers offering BNPL, as many customers use these directories to guide the start of their buyer’s journey
- Advertise your BNPL offering early and often, in paid ads, banners on your eCommerce site, an icon in the shopping cart, decals at your registers, and in seasonal promotions
- Assess where you’re losing customers in the eCommerce journey and put additional BNPL information there to test whether it impacts cart abandonment
- Teach staff how to sell BNPL as a purchase option – don’t underestimate the power of your sale associates
BNPL is a great way to grow the lifetime value of customers, to increase the average overall value of transactions, and to reduce abandoned carts. The right BNPL partner helps you get these benefits and protects your business from the many risks of BNPL cybercrime.