A process by which a customer buys a product but doesn’t pay the entire money instantly rather pay in instalments over time is called buy now pay later. When the buyer has an emergency or cannot pay the bulk of the cost at once they can choose to buy now pay later option even if the goods have a high price.
Benefits of buy now pay later
Here are some benefits if buy now pay later payment strategy:
Sales get increased
Buy now pay later provides customers with this facility to pay later after buying a product. If you are visiting an e-commerce site and you are very much attracted to some products but can not purchase them for money, it will give you the flexibility to pay later on in instalments. The same thing is applicable for in-store businesses also. You are inclined to buy things which are most necessary for you. Also, this buy now pay later gives a mental satisfaction and reduces money problems, so customers are more likely to buy less necessary products also and keep on adding to the purchasing list. Also, after having a good experience with quality and payment flexibility, people get back to the product again to purchase. These reasons increase sales in quite a huge amount, i.e. sales conversions and incremental sales have increased 25% and 17% respectively.
Attracting new customers
After a successful BNPL transaction being completed, customers try this again and buy products from online retailers as well as offline stores and pay according to their convenience. When this method comforts a customer and your company has provided good service, they refer your company to others. This is how you increase your sales. Also if your business has a website, people get attracted to your facility and buy from you. Through advertisements also, your store is open to more people and they get to know about your Buy now pay later advantages and purchase things in instalments. This is how the AOV or Average Order value and average order prices have increased 30% and 15% respectively.
Selecting best retailer
There are many stores available both online and offline also. When you search for a product, you must be wanting the best, product quality along with flexible paying options. So go with the best easy BNPL which suits you. Whether it is a big purchasing product or a small, paying method should be best for your ease. See the extensions, instalment amounts they are providing and select the best among them.
Payment solutions
Buy Now Pay Later is an instalment policy, under which customers enjoy the product first and pay in instalments in due time. Which ranges from 3 months to a few years based on the product price you have purchased. There is also a benefit of not paying interest if you clear your payment at the initial stage. If not, a minimal percentage of interest is added to your instalments, which is customer-friendly. You can also fix the duration and amount of paying the amount of the product you have bought. If the retailer provides these benefits to a customer, they get profit and more customers too. This is beneficial to both parties.
Payment methods
An ideal business owner should provide customers with all types of paying methods. From credit and debit cards to bank transfer, UPI transfer, e-wallet transfer whichever the customer prefers can pay with that. Also, some stores have QR codes to pay. This QR code is unique for every business account. The buyer just needs to scan the QR and pay. Often it is noticed that customers are not ready to swipe cards or enter a pin or share Bank details. In that case, buying now and paying later also includes another method without disclosing your personal details. Which includes a simple step of messaging. They send you a message on your mobile number. Just click and pay directly to a phone number without other procedures like cards, e-wallets and all.
Trust development
When you agree to the buy now pay later strategy, a good relationship is built between the customer and the retailer. Trust is grown gradually about their genuineness. This leads the customer to purchase something more in future which helps increase the brand value of the company.
Younger people are more attracted to buy now pay later
As the younger people try to experience more, they are prone to buy many things of their wish and needs. The range is between twenty-two to forty-six which is 87%. Sometimes having fewer savings, they pay in the Buy Now Pay Later method in a monthly manner which does not affect them financially.
Economic benefits of buy now pay later
When you pay in little quantity in a certain period, it affects you less. When you don’t have that bulk of money or you don’t want to spend all of it instantly you go for this method. Also, the retailer keeps getting the money timely along with the interest you have because of the instalment facility. So it’s profitable for both. Remember not to miss any instalment and pay in the given range of time to avoid fine charges.
Value of old customers
Statistically, it is found that out of all customers 50% new ones have increased in the last 5 years. But old customers give more profit though. If you calculate the Customer lifetime value( CLV), which means the expanse a person is doing during his/her entire life, then you will find that they are a major source of your store income. So they should be valued as well. Old as well as new customers browse online to buy something. Among them six % stocks products in carts. As they did not want extra charges on shipping or delivery. So be transparent and show your customers the expanses so that they don’t feel their money is being wasted and come forward to buy the product.
Final thought
BNPL has been taking the market more year after year. From 2018 to 2019 the use of BNPL has increased from 3% to 8%. Because it’s profitable for customers and store owners. So more people should adopt this paying method. Retailers should introduce this method to their store whether it’s online or offline and customers can also pay using BNPL according to their chosen skims.
Also read: The Ultimate Guide to Opening an Etsy Shop
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