Over half of consumers say they’re using buy-now-pay-later (BNPL) more often now than they were a year ago, suggesting a resurgence in popularity for a payment method that found prominence during the COVID-19 lockdown.
As part of its latest European Ecommerce Report published today, payments company Mollie has surveyed more than 5,000 consumers from Belgium, France, Germany, the Netherlands and the UK. It shows that 56% of consumers use BNPL more often now than they did 12 months ago.
As major industry players like Klarna move into the price comparison site, there is also validation for the power of social: Mollie has found that the overwhelming majority of consumers (98%) use some sort of social platform to conduct product research, with YouTube being the most prevalent followed by Facebook and Instagram.
The findings suggest a welcome tide-change for the BNPL sector, which had previously endured a turbulent period amid plummeting valuations, waning consumer interest, broader tech industry layoffs and concerns around affordability.
Despite the positive notes, adoption continues to be a challenge for BNPL companies. Mollie’s research has discovered that nearly two-fifths (38%) of consumers have still never used BNPL, despite its prominence in recent years, rising to almost half (49%) in Germany. There, consumers generally have other financing options such as purchase on account.
Consumer confidence returning, Mollie says
The survey shows the state of consumer sentiment amid sluggish economic conditions, with 99% of respondents saying they have modified their buying behaviour in the last 12 months. Roughly half of consumers (51%) feel negatively about the state of the economy, but 47% expect it to improve in the next 6-12 months.
Shoppers are becoming more price-conscious, buying at the lowest possible price in more than half of cases and doing more research about products than they did one year ago. There is also a positive outlook for ecommerce more generally, with 47% of consumers saying they shop more online than they do in physical stores.
Ken Serdons, Mollie’s Chief Commercial Officer, says: “In our 2022 study we saw a great deal of uncertainty from European consumers as rising inflation and the cost-of-living crisis followed the COVID-19 pandemic. Although we don’t face quite the headwinds we did last year, economies across Europe remain in a precarious position. The good news for online retailers is as economic confidence returns, so is the confidence of consumers who expect to spend more online this year than last year.
“As spending increases, ecommerce businesses need to evolve their customer acquisition and retention strategies. This involves providing diverse payment choices, streamlining the checkout experience, and ensuring their products are discovered and well-reviewed on consumers’ preferred social media platforms. It’s clear that buying behaviour is changing rapidly, and ecommerce companies need to know how to successfully navigate the ever-evolving economic landscape, convert customers, build loyalty, and supercharge business growth.”
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