Dive Brief:
- As buy now, pay later purchases rise, U.S. shoppers placed 29.5% more orders via Klarna on Black Friday this year compared to last year, the installment platform said in an email to Retail Dive.
- Among the top items Klarna shoppers clicked on during Black Friday were food mixers and processors (an increase of 242.2% from the previous week), TVs (up 181.7%), soundbars and home theater systems (up 174%), coffee makers (up 170.4%), eReaders (up 169%) and hard drives (up 165%), the company said.
- In a separate holiday shopping survey by Klarna, nearly all (81%) of the 15,000 U.S. and international respondents said having the option to pay for their purchases in installments without interest is useful during the holidays. Eighty-nine percent of Gen Z shoppers expressed this sentiment, the survey found.
Dive Insight:
Klarna’s growth in buy now, pay later transactions during Black Friday continues a trend from last year’s holiday season. Between Nov. 19 and Nov. 25, 2022, BNPL orders saw a 78% spike from the week prior, Adobe analysis found. During that same period, BNPL revenue rose 81%. Likewise, a report from PYMNTS found that 10.2% of shoppers bought their online purchases for Black Friday using installment payment services last year.
“Over half of US consumers are wary about credit card debt this season, with nearly 1 in 2 doubting their ability to pay off their holiday credit card bills entirely,” Kristina Elkhazin, head of North America at Klarna, said in a statement regarding its survey findings.
In addition to attracting holiday consumers seeking to stretch their budgets, the buy now, pay later payment industry has grown in popularity more broadly. According to recent Bank of America Securities data, Afterpay boasts the most U.S. monthly active users at 4.2 million people, followed by Klarna and Affirm with 3.3 million monthly active users each.
As buy now, pay later services compete for consumers, the industry now faces competition from major retailers. In August, Amazon announced plans to expand its installment payment service to other retailers’ sites through its Amazon Pay tool. With the service, shoppers can pay for purchases valued at $50 or more in monthly installments.
