Blog Post

Everyone understands what “buy now, pay later” means. It’s an idea that goes back millenia. The real question is why it’s back in the headlines and what that means for brands.

The answer is the recent rise of third-party Buy Now/Pay Later platforms that allow shoppers to quickly and easily spread out payments for a specific purchase over the course of time. Popular BN/PL platforms include AfterPay, Klarna, and Affirm. Maybe you’ve seen their names and logos peppering the check-out screen of your favorite ecommerce sites.

The biggest recent development in these platforms is that they launched apps. Consumers can now download these BN/PL apps and search them for deals and financing options at their favorite stores.

These platforms, which are now becoming publishers, are particularly important in the sales of higher-priced products.

Consumers who are looking at a $100 pair of jeans might not have $100 immediately to hand, but may be willing to buy if they have the option to pay $25 a week over the course of the next month.

Take the fashion space. 2020 began with a certain amount of volatility, with some brands struggling in the face of the changing conditions caused by the pandemic. Then, in the midst of it, Gen3’s team began to see a rise in performance among several publishers. We looked closer, and found that the pandemic had created the right environment for BN/PL publishers.

Consumers were troubled by the prospect of purchasing these items during the uncertainty of the pandemic, but BN/PL offered them a way forward for things like gifts and technology. Consumers were shying away from large up-front payments and attracted to paying over time.

What we found is that this model is very attractive to advertisers, particularly because there is no discount involved. BN/PL shows increasing efficacy as a conversion tool in itself. Shoppers have also shown an increased propensity to consolidate purchases in single sessions, so they can put multiple products on the same BN/PL plan.

These publishers provide consumers with a comfortable, easy process that is typically interest-free for spacing out their payments.

No background checks—just simple, high-level information. It’s not hard to see how it could be attractive.

 But, as always, the numbers tell the real story. Between 2019 and 2020, there was a 500% increase in YoY revenue through BN/PL publishers. In 2019, these platforms were a blip on the radar. In 2020, they surged to become 6% of revenue. Halfway through 2021, they already represent 10% of revenue and rising.

Gen3’s teams caught onto this trend early and immediately began building processes to maximize the opportunity for our clients. BN/PL is just another example of how our teams identify emerging trends for our clients, offering them new solutions to grow their sales and marketing efficiency.

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