How to offer financing easily and boost Black Friday sales
Thursday November 17th, 2022
How to offer financing easily and boost Black Friday sales
Financing options provide your customers with a better way to shop and a smarter way to pay. As well as offering flexibility and affordability, financing also provides customers with a better way of managing their money.
But, although financing can help your customers keep their life moving, it also provides a number of benefits for your business. With Black Friday fast approaching, adding a point of sale finance option can help you boost sales, increase conversion rates, reduce basket abandonments and improve the shopping experience for customers.
Here’s everything you need to know about how to offer your clients financing, how it can benefit you and why it’s particularly important to have a financing option in place before Black Friday.
What is point of sale finance?
Point of sale finance offers your customers a new way to pay. Rather than paying for the entirety of their purchases upfront, point of sale financing allows the customer to spread the cost of their payments over a number of months or years (depending on the amount they spend).
Due to the convenience it provides, our research has shown that a third of customers are more likely to spend money with a retailer that offers finance. We also found that 78% of people are more likely to return to a retailer who offers finance.
Understanding consumer spending and behaviour on Black Friday
Black Friday is one of the biggest shopping days of the year. Traditionally an American holiday, today it marks the start of the Christmas sales season in the UK.
Over the years, Black Friday consumer behaviour has changed markedly. Now, the holiday is more popular than ever. For example, last year, 55% of UK customers said that they spent more money on Black Friday in 2021 than they did in 2020. Of these, 22% said they spent ‘far more’.
Not only is the holiday gaining traction in the UK, but Black Friday consumer spending habits are also changing. Traditionally a holiday for bricks-and-mortar stores, Black Friday is now also popular with online stores and retailers. In the UK alone, the value of spending over the Black Friday weekend reached £8.71 billion last year, and only 40% of customers chose to exclusively shop in physical stores.
These statistics on Black Friday consumer behaviour show us that businesses must start to prioritise this holiday and ensure they’re well-placed to maximise sales during this busy period. One great way of doing this is to provide financing for customers. Let’s take a detailed look at why.
Reasons to offer finance to your customers for Black Friday
In today’s world, customers want more than just top products at great prices. They also want a seamless customer experience, flexible payment methods, hassle-free checkout and ultra-fast delivery.
For many customers, this means purchasing goods whenever they want to buy them, rather than waiting until payday. This is particularly true in the case of a major sales event like Black Friday, which this year falls on November 25. For many customers, this major sale will take place the week before payday.
With such great deals available on Black Friday, customers are unlikely to wait and hope that bargain deals stick around. Instead, many of these customers will look to purchase their chosen items on finance in order to maximise the savings they can experience.
If your business fails to offer point of sale finance on Black Friday, then you may find that you get left behind and customers shop with rivals who offer the service instead.
Overall, offering finance to your customers on Black Friday (and beyond) will provide your business with a number of benefits, including:
A better shopping experience and greater consumer choice
If you allow your customers to spread the cost of purchases, you can improve customer satisfaction levels. Plus, if your business offers a range of flexible retail finance options, you can significantly increase buyer confidence.
Although this applies year-round, it’s especially true on Black Friday. This is because, at this time of year, online shoppers usually browse more widely and visit multiple retailers before making a purchase.
In addition to this, due to the increased convenience and choice a finance option provides customers, the addition of such a solution can improve customer loyalty and encourage repeat shoppers. This is because not only does improving your understanding of your customers’ needs help increase sales in the short term, but it also helps you nurture relationships and boost customer loyalty in the long term.
Increased conversion on higher value items
A financing option can also help you increase sales and improve your cash flow. Plus, in the world of high-end, luxury retail, providing a finance solution can also help you improve your conversions.
Regardless of whether you sell luxury handbags, fine jewellery or hot tubs, finance can help you increase conversion rates on high-value items. Many customers see these items as investments that can increase in value over time, and spreading the cost of the item can make it much more affordable. This is particularly true if the item is on sale in a Black Friday promotion and is due to rise in price again shortly afterwards.
Reduces the risk of basket abandonment
Finally, a financing option can also help you reduce basket abandonment. Customers looking to grab a bargain during Black Friday may not realise the true cost of all the items they’re looking to purchase until they’ve filled their basket and clicked checkout.
In these instances, offering a finance solution allows the customer to split the cost of their purchases and makes them more affordable. It also keeps that customer on your website and leads to a higher volume of conversions. This is because you’ve made the process of purchasing those items and arranging payment as simple as possible. If you fail to offer finance and the items are unaffordable for the customer, they may simply abandon their basket to see if they can get the same items for less elsewhere.
Plus, by offering bespoke financing packages, you can get a huge boost on rivals who do not offer this service. This is because, by providing an alternative payment method that allows customers to spread the cost of their purchase, you increase the choices they have and improve their shopping experience.
How to get started
The good news is that offering financing for customers is simple. Plus, because the process is quick and easy to set up, you can start offering a finance option to your customers before Black Friday.
Duologi has a wide range of finance options available that suit both in-store and online retail businesses. Our point of sale financing options work like a loan between a lender and your customer. This means your business receives the cost of the purchase upfront and never has to do any debt collecting.
With our solutions, customers can apply for finance at the point of sale and then receive a decision instantly. This means the process doesn’t take any longer than existing/traditional payment processes. We even have an app that has been specifically designed to make the process seamless.
If you’d like to learn more about how to offer financing to your customers and how our solutions can help grow your business this Black Friday, get in touch with a member of the Duologi team today.