The pandemic led to an explosion in online shopping, but brands still need to find ways to decrease high cart abandonment rates
Over the past eighteen months, the retail industry has experienced the most profound period of change since the emergence of department stores transformed the shopping landscape over a hundred years ago. The move from in-store to online is now irreversible, and the trend has been accelerated by an estimated five years due to the explosion in ecommerce during the pandemic. However, one feature of this switch has cast a shadow: an increase in cart abandonment. This needs to be addressed and, increasingly, analysts believe the answer lies in payment innovation that improves consumer experiences
Flexible payment options offer a solution
41% of UK consumers have abandoned a transaction during online checkout, compared to just 24% of shoppers who have walked away from a purchase in physical stores. The range of checkout payment solutions offered to online customers is often not varied or accessible enough to turn browsing into sales. Recent research shows, for example, that close to ten million Britons have avoided buying from merchants which don’t offer alternative payment methods at checkout. This represents a considerable loss of potential sales for merchants who do not offer flexible payment options.
In response, there has been increasing innovation in buy-now-pay-later (BNPL) and checkout finance and this is accelerating with rising demand for more simple, convenient, and seamless purchasing experiences. Early BNPL checkout offerings used straightforward products and a one-size-fits-all model, but increasingly it’s clear that a more sophisticated approach is needed. Specifically, product flexibility tailored in line with business needs is crucial, and the next step in payments innovation is being driven by a need to achieve higher lender acceptance (and therefore conversion) rates.
Role of multi-lender BNPL in the future of retail
Despite soaring online retail sales figures, turning website visitors into paying customers can be a challenge as rising cart abandonment suggests. Therefore, making purchases more affordable for potential consumers is key. To ensure they don’t miss out on sales, businesses need to offer a wide range of payment solutions that maximise the chances of customers completing their purchases at checkout.
The future lies in moving away from rigid products and further optimising the underlying lender acceptance rate. Platforms such as Deko’s, which is multi-product and multi-lender, are boosting flexibility and coverage of financial products to address different consumers and basket sizes. They are also accelerating integration capability, broadening sector reach, and ensuring everything is available through a single platform, giving customers the best chance of purchasing the things they need.
The flexibility and range of lenders included in Deko’s offer allow the firm to help merchants provide unique flexibility for their customers. This is because Deko aggregates market participants across short-term BNPL and higher value and longer-term instalment finance, prime and near-prime lenders, as well as credit providers with different sector risk appetites.
This means conversion isn’t simply bound by a single lender or its customer experience and there is a payment solution for any basket, anytime, anywhere – all at the speed of a click. By automatically guaranteeing the best match between consumers, merchants and lenders, our merchant partners gain an average increase in sales of almost 30%.
Deko’s multi-product, multi-lender platform includes a breadth of financial payment products merchants can offer while ensuring they get the right solution for their business needs. Nevertheless, the process of integrating flexible payment finance into an online or physical store can potentially be complex and disruptive. That is why Deko has ensured that its products can be easily integrated into existing business operations. Its nimble solutions can be plugged into any existing infrastructure rapidly and seamlessly, meaning Deko can be integrated with new businesses in just 24 hours.
A seamless payment experience to match new retail trends
Where merchants had been expecting to gradually establish an online presence to supplement in-store shopping, the sudden end to physical retail prompted by the pandemic forced businesses to seriously invest in their wider digital offering. Certainly, the upward trend in online retail is accelerating, with nearly 22% of all retail sales worldwide forecast to take place online by 2024. There is a more marked picture in the UK, as the national ecommerce market is projected to grow by 37% until 2024.
These new retail habits deserve new payment options. Innovative platforms such as Deko are optimising not only the customer experience but coverage and acceptance too, reducing the higher basket abandonment rates that have accompanied the shift from in-store to online. Deko’s multi-product, multi-lender solution caters to businesses of all sizes and sectors, helping merchants offer flexible checkout finance tailored to all their needs. The future of retail is here.
For more information, visit dekopay.com