Create Online Store Payment Options with Afterpay
As part of our new bundle of checkout improvements, stores using Stripe as their payment processor are now connected to “buy now, pay later” payment plans like Afterpay or Clearpay. So what are Afterpay and payment plan options that offer buy now, pay later? Let’s break it down. Buy now, pay later (or BNPL) methods provide the option for customers to break their purchases into smaller payments instead of having to pay the full price when they place their order. You, the seller, get the full payment upfront, and Afterpay/Clearpay works with your customer to collect their full payment over time. A recent survey found that more than 70% of businesses using BNPL report higher conversions, bigger average order value, and more customer acquisitions. More sales + more money + more customers? We like the sound of that!
Benefits of Afterpay and Clearpay for Online Stores
Adding BNPL to your mix of online store payment options can help your business:
- Boost conversion
- Increase average order value
- Reach more customers
Boost Conversion Rates
If you’re selling furniture, fine art, or another higher price tag item, some shoppers may hesitate to click “add to cart,” due to the price tag. BNPL can help them complete the transaction, since they can split that cost over four payments. In fact, businesses offering Afterpay or Clearpay see an average 22% increase in cart conversion.
Increase average order value
Stores using some BNPL methods report an average 40% increase in average order value. It makes sense: when a shopper knows they can space out their purchase payments, they can add a few extra items to their cart or spring for that higher value, special edition item they’ve been eyeing.
Reach More Customers
Afterpay’s network includes 19 million global customers, 73% of which are Gen Z or millennials. BNPL appeals to customers who may not have a credit card or the ability to pay for large purchases in a single payment. It turns a product that was aspirational into one that is attainable.
Payment Plan Considerations for Ecommerce Stores
It’s worth noting that BNPL often comes with a different transaction fee than you may be used to. For perspective, at the time of publishing, Stripe takes 2.9% of the order total + $0.30 for a standard credit card. Afterpay or Clearpay via Stripe have a higher transaction fee: 6% of the order total + $0.30. Big Cartel doesn’t take an additional transaction fee for either payment option. You can confirm the exact fee for any BNPL options you’re considering on Stripe’s website and turn off any options that you don’t want to offer in your Stripe admin. The good news is that even when your customer uses Afterpay, you get paid in full upfront, so there’s no waiting for the funds to trickle in. And because Afterpay handles collecting payments, they assume liability if a customer files a fraud-related dispute, or if they have any other trouble collecting funds. Once you’ve added Stripe as a payment processor, Afterpay is automatically turned on in your shop. For more details about how this payment method works, or for steps on switching it off or turning on additional BNPL options, head to Big Cartel’s help site.