As the festive season approaches, consumer spending is set to surge. This period, marked by celebrations, is also a peak time for shoppers, be it for last-minute gifts, festive wear, electronic items, or more.
According to an ET report, $6.5 billion or Rs. 55,000 crore, worth of goods were sold in just one week of the festive sale, a 26% jump from the previous year. So, for any e-commerce business, this is the most opportune moment to offer festive discounts and maximize sales.
But just offering discounts or deals will not do the trick. Today’s consumers are not just looking for the best bargain. Instead, they want the right products and have already researched the brand or type they want. To win this customer, you must offer flexible payment options, such as debit card EMI, credit card EMI and UPI payments
Here’s a detailed look at each of these payment methods, helping you understand just how much of a difference it can make in catering to the evolving needs of modern shoppers.
Need for flexible ayment Options
While festive discounts and sales are the most significant pull factors for any brand, they don’t always promise high conversion. To win today’s consumer, you need to prioritize customer centricity and your customers’ unique requirements.
You can help turn this prospective customer into a buyer by offering multiple and flexible payment methods. Recent reports suggest that 3 out of 4 products sold online are through no-cost EMIs, showcasing a clear shift towards flexible financing.
By giving customers various payment options, you can:
1. Accommodate a broader Customer Base
By making it easier for your customers to make the payment, you attract a larger customer base, especially those who may hesitate to make a one-time, high-cost payment. They can make the purchase through no-cost EMI or BNPL options and not feel the pinch on their wallets.
2. Improve Conversion Rates and reduce Cart Abandonment
Offering a range of payment options can directly impact conversion rates by reducing friction at checkout. Customers who see flexible payment solutions are more likely to complete their purchase, especially if they’ve previously abandoned carts due to payment concerns. This helps you prevent lost sales and optimize your overall revenue.
3. Higher Average Order Value (AOV)
When customers have access to convenient payment terms, they’re more likely to increase their cart size. As per a Statista report, the average order value for most e-commerce sites was around $250 without BNPL payment, and it would be worth $280 with BNPL options.
By enabling your customers to manage larger purchases with instalment plans or BNPL options, you make them feel more empowered to purchase additional items or more premium products when they know they can spread the cost.
4. Gives you a Competitive Edge in the Festive Season
Every brand and eCommerce platform knows the importance of festive sales, and the discounts and deals are extremely competitive.
Businesses that offer flexible payment methods gain a competitive edge by aligning with customer needs and preferences. As shoppers search for the most convenient and affordable buying experiences, a business equipped with diverse payment options stands out, making it the preferred choice for festive shopping.
Types of flexible payment options
Now that we know why flexible payment options are crucial for your online business, here’s a quick look at the popular payment methods and their benefits and limitations.
1. Debit Card
Debit card payment is one of the most basic payment methods. It allows customers to pay for a transaction using the bank’s debit card. The funds are deducted directly from the bank account, allowing you the convenience of making a payment without having cash.
- Benefit: Allows customers to make purchases directly from their bank account, ensuring immediate payment without the need for credit.
- Limitation: Debit payments lack the credit flexibility that some customers seek, especially during festive spending. Some cards offer debit card EMI, but this is limited to select customers.
2. Credit Card
Similar to the debit card, a credit card allows customers to make a purchase and pay for them at a later date. This allows you to get the sale, while the customer has the flexibility to pay for the transaction by settling it on the payment date of the credit card or converting it into EMI.
- Benefit: Offers the flexibility of deferred payments with additional perks like reward points and cashback, which are particularly appealing during high-spending seasons.
- Limitation: Customers with limited or no credit history might not have access to this option.
3. UPI Payment
Another quick and easy payment option is the Unified Payment Interface (UPI). It allows consumers to make payments directly from their bank accounts using a mobile app. UPI payments are real-time and often free of transaction fees, making them an appealing option for customers seeking convenience without extra costs.
- Benefit: Fast and secure, UPI payments are widely used in India, helping you reach not just the urban crowd but also those in tier-2 and tier-3 cities.
- Limitation: Not all customers are familiar with UPI, and it might lack the flexibility of installment-based payments.
4. Cash On Delivery (COD)
Cash on Delivery (COD) allows customers to pay for their purchases when they receive their orders. This option is popular among shoppers who prefer to inspect their products before paying, enhancing trust and often leading to higher conversion rates.
- Benefit: COD builds trust with customers who prefer payment only after receiving their goods, making it popular in regions where online payment adoption is lower.
- Limitation: COD carries logistical challenges and can lead to higher return rates, adding to operational costs.
5. Net Banking
Net Banking enables customers to make direct online payments through their bank accounts. It’s a secure and familiar payment method for users, especially for those who prefer not to use cards.
- Benefit: Net banking provides a secure and familiar option for customers who prefer traditional bank transfers.
- Limitation: It is less convenient compared to quicker, one-click options like UPI and can lead to slower checkout experiences.
Introducing Plural’s Affordability suite
Since each payment method caters to the unique needs of a customer base, offering just one or two options may not be ideal.
To help you offer multiple payment options without going through a complex process, you can explore Plural’s Affordability Suite. It simplifies the process of offering various payment options, from EMI plans to Buy Now, Pay Later (BNPL), creating a seamless checkout experience that encourages conversions and boosts customer satisfaction.
With this suite, you can create a flexible payment experience for your customers and easily get started with:
- Fast integration: Plural’s suite can be effortlessly integrated into existing platforms, reducing the technical and operational complexity. Thus, you can quickly get started and offer EMI or BNPL options without extensive setup.
- Flexibility to tailor offers: The suite allows you to offer tailored payment offers, such as no-cost EMI and limited-time discounts, appealing directly to cost-conscious shoppers.
- User-friendly dashboard: Plural’s intuitive dashboard centralizes all payment methods in one place, making it easy for you to manage, track, and adjust payment options to meet seasonal demand.
- Get real-time reports: With real-time data and analytics, Plural’s dashboard empowers merchants to track customer engagement, optimize offers, and make data-driven decisions to refine payment strategies during peak shopping seasons.
Summing Up
As the festive season brings a surge in consumer spending, offering flexible payment options has become essential for businesses looking to capture this demand.
Plural’s Affordability Suite simplifies the implementation of these payment solutions, equipping businesses with a user-friendly dashboard, real-time analytics, and customizable offers that align with your customer’s unique needs. This ensures a smooth and appealing checkout experience, enabling you to stay competitive and capitalize on festive opportunities.
Make this season even brighter for your customers by providing them with the flexible payment options they seek. Contact Plural today to explore how the Affordability Suite can help your business utilize new growth and success this festive season.
