Peak season may look slightly less merry for retailers this year. With rising inflation rates and economic uncertainty causing consumers to cut back on spending, 51% of shoppers are planning to purchase fewer holiday gifts this year.
While retailers want to avoid a race to the bottom in terms of discounted pricing, there are signs that shoppers will begin planning for the holiday season earlier than ever. Price-sensitive deal seekers are likely to start searching for gifts as soon as possible, and Buy Now, Pay Later (BNPL) is a perfect way for consumers to pay over time and make the most of a budget-friendly option.
This article will explore three ways retailers can incorporate BNPL messaging throughout the customer journey to elevate email and mobile communications during the holiday season.
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Highlight BNPL availability to help consumers check off their Christmas wish list
It's no secret that peak season is all about gifts. With global economic uncertainty causing consumers everywhere to tighten their budget, BNPL makes it easy for consumers to budget for everything on their wish list. Major retailers are picking up on the cue, especially for online shopping. In fact, eCommerce retailers that offer BNPL services see an average of 2.1% higher conversion rates.
Consumers want shopping to be simple. And the fewer clicks it takes to purchase what they need for holiday gifts, the better! It’s important for marketers to help consumers cut through the noise and ultimately make a purchase. As a solution, Inkredible Retail decided to use a poll for capturing gifting intent, asking customers who they are shopping for this holiday season.
Marketers can then use that zero-party data to target relevant product recommendations and highlight the installment payment price for each option. By combining relevant products with payment flexibility, retail marketers can increase their average order value and help consumers check items off their gift list, in this case, the perfect pair of shoes.
Lean on BNPL as a key-value driver in the absence of promotions
While the holidays are a time for family and gift giving, they’re also synonymous with sales and promotions. Black Friday and Cyber Week have conditioned shoppers to seek out promotions. The discount window has morphed into a promotion cycle that can often last for months.
Consumers will look for deals, promotions, and free shipping to accommodate this year’s tighter budgets. For retailers, highlighting value early to avoid a discount race to the lowest price will be crucial. Especially for items with a higher price tag, BNPL can easily deliver value and reassurance by showing payment breakdowns and reminders that there’s still an affordable way to purchase.
Associate Director for Financial Services Strategy, Alex Manly shared that "for innovative and savvy BNPL brands, it's all about relationships. BNPL brands like Klarna and Afterpay are bringing new ideas to the table and supporting retailers to open-up new marketing channels that lift customer engagement."
It’s time retailers plan for more than just a slew of promotions by leaning on other value-drivers. BNPL is a powerful alternative for cost-conscious consumers (and margin-conscious retailers). Instead of depending on price drops to drive holiday conversions, retail marketers can utilize behavioral data to surface recently browsed products, alongside the monthly or weekly payment breakdown per product.
Simplify conversion with basket payment breakdown
The holiday season is highly competitive, especially now, with eCommerce natives and multi-channel retailers vying for reduced wallet share in a critical quarter. That said, the onus is on retailers to stand out in the crowd by providing a convenient and seamless online experience for consumers.
Payment flexibility plays a substantial role in that simplicity. Case in point: 89% of shoppers said payment options made buying decisions faster and easier. It’s important to make sure the availability of BNPL as a payment option is abundantly clear to shoppers, particularly those further down the purchase funnel.
Beyond ensuring BNPL options are clear at check-out, retail marketers can remind customers of their abandoned cart with a dynamic notification banner, highlighting the installment payment cost of their basket.
Consumers are shopping online this holiday season and they need an online experience that matches the current economic moment with easy payment options. By taking out the legwork and bringing relevant BNPL messaging into email and mobile communications, retailers can provide customers with a valuable shopping experience to get a head start in the competitive holiday environment.
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