A behemoth enters BNPL.

by Jim March 18, 2021

PayPal has announced its Pay in 4 buy now, pay later service will launch in June. They have a strong customer base here and are promising easy integration to existing merchant accounts. While it will certainly affect the BNPL pecking order there are some issues that must be taken into consideration.

  • Google’s still hiding results from me!
  • Make sure everything on your site is easy to use.
  • Pay in 4 will be easy to integrate.
  • Why it’s not with some problems.
  • Will you use it?

Transcript

Hey, welcome back Rankers. How you going? Wow. A lot’s happened this week. The big news is PayPal entering the buy now, pay later market, and more about that right after this, because in our continuing serial of bad results in Google, ones we don’t understand, here’s another one. So too bad if you are an SEO trying to rank for this one. So this is a story that came out during the week and I was just looking for more information on it. BBC propaganda contracts. And all I could find in Google was something from 1927, which isn’t what I was looking for. So then I went to Bing and everything I wanted to see, the story I was looking for was there. And I also went to DuckDuckGo, and the story was there. But not in Google. I don’t know why, but there you are. You can make up your own mind or do your own research and try to work out what’s going on there, because I don’t know.

Pay in 4.

But buy now, pay later. Here’s a funny story. We’d set up a buy now, pay later scheme for someone recently, and they wanted to set a minimum spend of $500. So rather than them get to the checkout and having loaded up their checkout with a $50 item and then finding out that they can’t use this payment method it was decided that it should be made mentioned on the product pages that this particular buy now, pay later scheme was only available for people purchasing over $500. So it was very clear. You can see what it said. Unfortunately, it didn’t work, because what happened was, people are special and they’ve become more special since mobile devices. So we have this conversation a lot and I’ve had it a lot with website owners as well, where they say, “What is wrong with people?” Nothing, they’re just people. They’re just not website engineers. They have problems with sites because it’s too hard, basically.

Anything that’s too hard or creates cognitive load is going to cost you sales. And that was the case with this client, because, I mean, we fixed it now. But that was the case with this client, they actually had one guy turn up to the store, the physical bricks and mortar store, because he said, “Nah, I’m not going to buy online, because you’ve got that minimum of spending the $500.” Now, it was really clear right next to the buy now, pay later button, but some people thought there was a minimum spend on everything, even though it didn’t say that. So the simplest things which you think might be very, very clear, quite often aren’t. And a lot of the buy now, pay later stuff that is out there can be complex to set up for merchants, a bit of a jiggery-pokery going on.

So we have PayPal entering the buy now, pay later market. That’s significant. That’s massive. That’s big. So we’re probably going to see some consolidation in the industry, I would say, because this is only in Australia, from what I can tell. I’ve only seen the Australian announcement anyway. There are nine million PayPal users in Australia and they will automatically be eligible to use the buy now, pay later for PayPal, Pay in 4. Now, it’s significant because the setup is relatively really, really, really easy for merchants. If you’re already using PayPal, it’s just going to be an update to the PayPal widget. So you’ll be either Pay in 4 or normal PayPal. And that’s a barrier to entry that’s been removed for a lot of merchants, so they’re already set up for buy now, pay later and they didn’t even know it.

BNPL merchant issues.

So PayPal has said this will be completely available by June. Now, to give you an idea of where they’re competing in the market, it’s from the $50 to the $1,500 range. So some of those ones that are obviously targeting over that, they’re probably not going to be affected, but anybody under that, probably will. And I did have a chuckle this morning. I don’t know whether this is new, but I was going to say Google Pay in 4, but I didn’t. I DuckDuckGo’d it. Do you reckon it’ll ever become a verb? “Did you DuckDuckGo that?” Pay in 4 was my search, and, of course, number one ad is Klarna Pay in 4. Now, I don’t think PayPal would have messed up their messaging and jumped on something that Klarna was already doing. So my take on that is possibly Klarna is buying the key phrase or putting it in their title, which means that PayPal didn’t get a trademark on it. So that’s interesting.

So are you going to be using buy now, pay later from PayPal as a service? I’ve already spoken to some clients about it, and one of the gripes that many retailers have about PayPal, of course, is that the merchants can get left high and dry if the customer says, “Oh, I never got it, or, “It was rubbish,” and they immediately refund the purchaser. But just remember, when you are setting these things up, people are special, because we talk about sessions and users, but it’s people trying to use your site. And we’ve found something else in Google Analytics, which I’d never even looked at before in 15, 20 years or whatever using Google Analytics, even before it was urgent. I’d never looked at this section before and I looked at it and I went, “Oh, wow. That is some amazing insights of what people are doing and what problems they’re having and what the data is telling us about people.”

So just remember, your customers are special and a lot of them are not automatically trained to learn how to purchase off a mobile device, and that’s why you’ve got to make it as easy as possible. That’s why this buy now, pay later stuff is, well, for the merchant this time, it’s really easy to set up. But a lot of the complaints I’ve already had from clients is that the merchants often get left high and dry when the order is refunded. But I’d love to know your thoughts. Will you be using the Pay in 4 from PayPal? If you’re already offering PayPal, you’d be crazy not to. You wouldn’t be able to not offer this product I would think, because your competitor will. Anyway, let us know in the comments either on LinkedIn or on YouTube. And please, don’t forget to smash that Like button. Hit Subscribe, if you like. And tell your friends and leave a comment. Hopefully that’s helpful, and we’ll see you next week. Thanks very much. Bye.

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