Page 16 - AeM_Dec_2017

BEST PRACTICES & STRATEGIES

Delayed payment options will give not only

online conversion a boost

With an increasing number of clothing & footwear soiled and a higher cost of fulfilling and processing
retailers offering delayed payment options in an returned goods.”
attempt to drive conversion, retailers who offer ‘try
before you buy’ options - and are well placed to cope A recent GlobalData survey revealed that 52% of online
with processing returned goods - will be most likely to shoppers often buy more items than they expect to
make the service a success, according to GlobalData, keep when purchasing online, and ‘pay later’ options
a leading data and analytics company. will only encourage this shopping mentality. This makes
it essential for retailers to test delayed payment options
Retailers including H&M, Finery and Arcadia brands on their own websites to measure the impact on their
Topshop and Dorothy Perkins now offer a ‘pay later’ customers’ shopping behavior, which will vary
online payment option to encourage shoppers to considerably based on target demographic and product
purchase when they might not have the funds readily type.
available. ‘Try before you buy’ payment methods often
appear more straightforward as a short-term solution Wilmott continues: “Returning goods purchased using
compared to traditional credit accounts. the delayed payment option will be a more seamless
process for shoppers, since the need to wait for refunds
Sofie Wilmott, Retail Analyst at GlobalData, is void, but retailers will have a higher volume of items
comments: “Delayed payment methods will break to process and quickly make available for sale once
down barriers to purchase online and boost average again. This puts additional pressure on an already
order value, but retailers will be hit with a higher costly operation, particularly those which rely on
returns rate. Undoubtedly shoppers will purchase more outdated systems and fulfilment centers.
readily, supporting volume growth, but once the
realization of paying for items sets in, a higher “While customer facing initiatives are at the forefront of
proportion of items will be sent back. Offering delayed retailer investment plans in 2017 and 2018, players
payment options to consumers therefore comes with introducing delayed payment methods must focus on
risk. More items will sit in the warehouse unavailable to enhancing back-end operations to reduce the time
be purchased, there is a greater chance of stock being product is spent offline so sales opportunities are not
missed.” ◊ By MediaBUZZ

16 December 2017 - Digital Commerce & Customer Experience