Understanding changing consumer behavior is key to succeeding in today’s hyper-competitive marketplace, especially online, where competitors’ offerings demand attention on comparison shopping sites or in the SERPs. Forty-two percent of US buyers give up a purchase if they can’t use their preferred payment method, and cart abandonment rates are a key indicator of retail success.
Brands can avoid losing thousands of dollars in sales by investing in installment payment solutions, especially since 60% of shoppers are drawn to Buy Now, Pay Later (BNPL) models. It’s an option that many will have considered, but until recently such an offer involved retailers becoming credit brokers – not the easiest process.
This is where Splitit comes in to help you generate sales and increase your profits. The service acts as an intermediary between consumer and retailer, helping customers make the purchases they want (without overburdening their finances) and retailers making the sales they need.
A look at Splitit
Splitit was founded in 2012 by Gil Don and Alon Feit at the very beginning of the online retail revolution. The two established the company in New York, as a platform that continues to drive change and make a difference in e-commerce.
Distinctly different from most BNPL services and point-of-sale installment loans, Splitit is free of fees, applications and credit checks. In many circumstances, even a quick digital point-of-sale credit check turns off many buyers, and not just those with poor credit. For buyer and seller, Splitit is transparent and non-invasive of privacy.
The service ensures that the payment method designated by the buyer is valid and valid for the full amount of the cost and reports the first payment and subsequent payments, placing a pre-authorization on subsequent payments. Pending amounts are simply debited on an agreed time scale.
Unlike new credit agreements, Splitit allows buyers to make purchases up to the existing credit available on their designated card. The process is open and transparent to all parties, and the service is fully PCI-DSS compliant. This means that the additional data governance hurdles that retailers would typically have to overcome to keep shopper cards on file are unnecessary: Splitit manages card security on behalf of all of its retail partners.
With many retail outfits on equal footing thanks to the democratizing effects of internet-based e-commerce, many shoppers come to shop with a chosen payment method in mind as they browse. The Canadian consumer trends report shows that millennials and Gen Z expect a variety of payment options, and by offering the simplest form of BNPL, retailers can ensure their offering is different. Splitit ensures that no customer loses their card points, cashback, airline miles or bonuses, but does not charge them any interest.
According to research from the Baymard Institute, 69% of shoppers abandon their cart, causing companies to miss out on potentially huge sales. In the UK, for example, a YouGov paper shows that retailers lose up to $18 billion a year.
Keeping POS fast and convenient with no external form filling or offsite credit checks means retailers keep as many customers engaged and processed quickly as possible. For big ticket items, processing speed is a big factor in cart abandonment, in particular, and the BNPL model helps alleviate last-minute buyer’s remorse. In fact, buyers appreciate being able to choose their payment terms, knowing they can make large purchases without shelling out for many months. Splitit helps manage the budget and encourages consumers to think more positively about their buying decisions.
E-commerce retailers offering Splitit claim an improvement in sales conversion rates of around 30%, which is in line with the company’s research that 56% of buyers prefer monthly installment payments. By sticking to the four-week cadence of card statements and reconciliation, busy Gen Z consumers aren’t juggling multiple credit repayments or worrying about credit scores.
Integrating Splitit for retailers is simple, with just a few lines of code to integrate into the e-commerce installation. Once in place, retail managers can offer these simple payment terms to all customers – many retailers place the Splitit installation at the center of their stores as an important sales driver. And it seems to work!
To learn more about Splitit and how easy it is to integrate this incredible customer experience-focused service, contact a company representative today. There is even a self-integration procedure for companies with an annual throughput of less than $2 million.