Rapid Growth of BNPL
Due to consumers being driven online during the pandemic, buy now, pay later options have skyrocketed.
According to new findings from SimilarWeb in its recent analysis of the BNPL space, between January and December 2020 e-commerce websites offering either Klarna or Afterpay grew by nearly 60 percent. Researchers from the company said this is likely due to a combination of factors including an increase in the total number of e-commerce sites responding to brick-and-mortar stores closing, meaning the addressable market for BNPL has grown, and existing e-commerce sites looking to maximize onsite conversion by offering consumers more ways to pay.
“We know that especially in the early days of the pandemic consumers were forced to make unexpected purchases such as working from home equipment that they would not have necessarily budgeted for, making BNPL an attractive option,” authors said of the report.
Moreover, SimilarWeb’s data found that companies offering a BNPL option have higher conversion rates.
In fact, in looking top 50 fashion and apparel sites in the U.S. that offered BNPL and the top 50 who did not, those who offer Klarna or Afterpay had an average conversion rate of 5 percent compared to 2.4 percent for those websites who do not offer the option.
The data, SimilarWeb said, is an indicator of just how effective offering a BNPL option can be in turning more visits into paying customers.
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