Reduce Friction at Checkout with Buy Now, Pay Later

It’s no secret that checkout is an integral part of a customer’s ecommerce shopping experience. We’ve written extensively about the checkout process and how businesses can improve customer experience to increase conversions. One of the quickest ways to create a customer-centric checkout experience is to reduce friction in the process itself. 

What do we mean by “reduce friction?” The answer is simple. Make checkout easy. Any bump in the road or hiccup in the process can have a customer thinking twice about completing a purchase. A Baymard Institute survey found that 17% of shoppers will abandon their shopping carts if a checkout process is too long or complicated. 

How you reduce friction, on the other hand, might not be so simple. Here are some ways your business can reduce friction and improve shopper experience. 

Allow for Guest Checkout

Baymard Institute data show that 24% of customers abandon their carts because a site asked them to create an account. While gathering a customer’s email address and other data can be appealing, is it really worth losing a sale over? Letting a customer continue with the checkout process without creating an account can quickly reduce friction and allow for a seamless customer experience. 

If you really have to ask them to create an account, give them a reason to. Offer a 10% off coupon with sign up, create a loyalty rewards program or even send them some cool swag to go along with their purchase. But whatever you do, make it optional. No one wants to be forced into signing up. 

Accept Multiple Payment Methods

Many of us remember the old days where many in-person retailers wouldn’t accept certain payment types like American Express or Discover cards because of high fees. It was frustrating, to say the least. Things have changed a lot in recent years, and brick-and-mortar stores are beginning to accept many different payment types, even digital wallets like Apple Pay. 

Now put yourself in a customer’s shoes — err…keyboard? — and think about how they would react to not seeing their payment method of choice accepted on your site.

If they’re like 9% of shoppers on the web, they’ll end the checkout process right then and there. By accepting multiple payment methods like Apple Pay, Amazon Pay, PayPal and others, you’re creating an experience with the least amount of friction possible for the customer as they continue checkout. 

Accept Multiple Payment Options

Payment options? Isn’t that the same thing as a payment method? Not quite. Think about the last big purchase you made. You could choose to pay with cash, card or digital wallet, but you also had an option of how you’d pay: up front or using installments. 

When translated to ecommerce, this installment option is known as Buy Now, Pay Later, or BNPL. Consumers around the world are starting to embrace this payment option and expect it to be available on your site.

What is BNPL? 

BNPL is exactly what it sounds like. A customer makes a purchase now, but pays later through an installment plan agreed to at the point of sale. 

Who is using BNPL? 

Historically, BNPL has been used by younger shoppers, like Millennials and Gen Z. In fact, from 2019 to 2021, BNPL use grew by 600% among Gen Z shoppers. Millennial use of BNPL has tripled. 

When it comes to older generations, BNPL use isn’t growing as quickly, but is still a popular payment option. In 2021, eMarketer found that 17.2% of Gen X shoppers had used a BNPL option, while only 6.2% of Baby Boomers used the option.

Why is BNPL so appealing to shoppers? 

BNPL has risen in popularity for many reasons, but these are some of the biggest. 

Credit card use is on the decline

Credit cards just aren’t as popular as they used to be. Shoppers’ dissatisfaction with companies and their terms are causing a shift away from traditional borrowing to more modern methods, like BNPL. 

BNPL is affordable

Some BNPL providers may charge  lower fees and interest rates than traditional credit card companies, which could mean less long-term cost for shoppers.

BNPL is convenient

For many shoppers, BNPL offers a convenient, flexible payment option where there hasn’t been one before. Breaking up a purchase into multiple payments gives all shoppers the opportunity to purchase what they want, when they want it. 

Choosing the Right BNPL Provider

As BNPL has grown in popularity, the number of companies offering this service has also grown. Here are a few things you should look for when choosing the right BNPL provider for your site. 

Look at the terms. 

Many BNPL providers offer different term lengths, ranging from a few weeks to a few years. What kind of terms are offered on your store will probably depend on your average order value, or AOV. A high AOV usually means a lengthier repayment period, while a lower AOV means a shorter term. 

Look at the limits.

When it comes to BNPL, there are usually minimum and maximum limits for the amount of credit offered. Evaluate your limits compared to AOV to see what will work best for your business. 

Look at locations served. 

Different BNPL providers operate in different markets. Where your business is located could mean the difference between one provider over another. 

There are plenty of BNPL providers out there. At BigCommerce, we partner with Affirm to provide BNPL services to our merchants. 

What is Affirm?

Affirm is a BNPL provider that delivers honest financial products that gives over 14 million shoppers the tools to purchase what they want, when they want it. Affirm doesn’t charge shoppers any fees for its service, so it’s easy for them to make smart choices with their wallets. It is available to consumers in the US and US territories (subject to eligibility). 

Shopping with Affirm is easy. After choosing Affirm at checkout, shoppers choose their terms. These range from four interest-free payments every two weeks to monthly installments. After a purchase is made, shoppers can manage payments in the Affirm app or online. They also have the option to set up automatic payments, making it easy to pay on time. 

Affirm also has a network of over 235,000 merchants on the Affirm app that allows shoppers to discover new goods and services quickly and conveniently. Shoppers simply open the Affirm app and go to the Affirm marketplace. From there, they can find brand names across a variety of industries, including lifestyle, fashion, beauty, travel, fitness, auto service and parts and more. This allows shoppers to discover and pay for products from one convenient location.

How Does Affirm Help Merchants? 

Affirm helps merchants in many ways. Data show that reducing friction and offering more payment options at checkout can increase conversions. By offering Affirm on your site, you’re creating a better, more frictionless path to purchase for your customers. 

The Final Word

While there are many ways to improve the path to purchase on your site, there is no magic bullet to improve conversions. Instead, business owners need to take a multifaceted approach to improving their checkout process. This includes allowing for guest checkout, allowing users to checkout with multiple payment methods and offering multiple payment options for users that want them. 

One such payment option, BNPL, is quickly becoming a go-to option for Gen Z and Millennial shoppers. While there are many BNPL providers out there, BigCommerce is proud to offer Affirm as a preferred payment partner to our merchants. Affirm helps empower shoppers to make purchases when and how they want, while also helping merchants grow their business by making shopping easier than ever before. 

Are you interested in adding Affirm to your BigCommerce store? Learn more about the integration and partnership here.