With everyday life continuing to be digitalized, more consumers are enjoying the ease and convenience of online shopping. In 2020, almost 87% of UK households made online purchases resulting in the highest online purchase penetration rate that the UK has seen in the past 11 years.
The growth of the UK e-commerce industry
As more people are shopping online, this has ultimately led to the UK e-commerce industry growing from strength to strength. According to the Office for National Statistics, the UK e-commerce revenue in 2019 totalled £693 billion. However, as of February 2022, this increased to over £2,089.6 billion.
The growth of flexible finance
Alongside the growth of the UK e-commerce industry, flexible finance options have also increased in popularity. In fact, a study found that 8.6 million British consumers plan to use flexible payment options in the future. The study also found that 9.5 million UK shoppers said they would avoid businesses that don’t offer finance.
The role of flexible finance
When an item has been placed into a customer’s basket, and they proceed to the checkout page, a finance option will be available, allowing them to purchase the product but pay for it over time.
Why implement it into your e-commerce business?
Offering your customers the chance to pay for products using finance can benefit your e-commerce business. Some benefits include:
Stand out from the crowd
The e-commerce industry is hugely competitive. In fact, in 2020, there was a 43% increase in new UK businesses joining the industry.
Offering flexible finance options can help your business stand out from the crowd and attract new customers. The ability to make repayments over time can be the sole reason why someone may choose your business instead of a competitor.
A problem that most e-commerce businesses face is cart abandonment. There can be many reasons why someone may leave an item in their cart and not proceed to make the purchase, for example, personal finance. However, by giving the option to pay with finance, you will be able to mitigate this problem and ultimately improve conversion rates.
Increase customer loyalty
With flexible finance options growing in popularity, it is important to keep up with the ever-changing behaviours of consumers and their demand for flexible payments. Offering finance at checkout will show that you care and cater for their needs, ultimately resulting in loyalty and trust.
Increase average order value
Finance can make shoppers feel more confident about making larger purchases or even adding additional products to their baskets because they know that they can make repayments over time. That increase in confidence can ultimately lead to a higher average order value.
The UK e-commerce industry looks like it will continue to grow over the next few years, and offering flexible finance options is a fantastic way to help your e-commerce business flourish.
If you are looking to implement flexible finance options into your business, speak to one of our specialists today.