Nearly half of Gen Z, Millennials to rely on “buy now, pay later” this holiday season
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- As shoppers stretch their holiday budget, a survey of 1,000 consumers from the customer service technology firm Bluedot found that four in 10 respondents said they plan to pay for their holiday purchases with “buy now, pay later” (BNPL) services.
- The survey found that almost half (48%) of Gen Z respondents said they planned to use BNPL services this holiday season, followed by Millennials (47%), Gen X (40%), and baby boomers (14%). Nineteen percent said they are using BNPL services because they’re low on cash.
- Eighty percent of respondents said they plan to shop via retailer mobile apps the same amount or more during the 2022 holiday season than last year. More than half (55%) of respondents said they plan to use retailers’ mobile apps because they are easy to use, while 38% say they are looking for discounts.
While “buy now, pay later” transactions were on the rise last year, it remains to be seen whether that trend will continue this holiday season.
BNPL surged last year, with Afterpay reporting a 34% jump in in-store and online installment payment orders from the 2020 holiday season to 2021. But, of the Gen Z consumers who used “buy now, pay later” platforms for their holiday purchases in 2021, 43% had missed at least one installment payment that year, according to a Piplsay report.
The share of BNPL transactions in e-commerce revenue rose by 5% between January and September compared to last year, per a recent Adobe Analytics report. BNPL revenue saw a 27% bump in revenue during the 2021 holiday season compared to 2020 and 475% from 2019.
Though many consumers are using retailers’ mobile apps to shop for the holidays, Bluedot’s report notes that consumers are also turning to social media to buy gifts. More than a third of consumers said they were going to use retailers’ mobile apps to look for discounts (38%), search for items that they can’t find in stores (38%), and hunt for better prices (36%). The survey also noted that 56% of Gen Z consumers plan to buy their holiday goods via social media, followed by 49% of Millennials and 43% of Gen X consumers.
“This year’s holiday shopping data signals a major opportunity for retailers not just to lure consumers to the store, but also boost long-term customer engagement,” Judy Chan, Bluedot’s chief marketing officer, said in a statement. “While not a complete land grab, retailers can definitely take advantage of the holidays to imbue and impress consumers as they are more willing to hear from them. Those that prioritize loyalty from an overall mobile, digital strategy, including easy-to-use mobile apps and websites with high-value deals and discounts, are much better positioned to increase revenue, deliver a differentiated customer experience, and ultimately boost brand engagement and customer retention.”
In addition to BNPL, Bluedot’s report echoes other research indicating that consumers are relying more on credit cards to stretch their budgets. A report from Beyond Finance found that 43% of consumers have more than $5,000 in credit card debt. Forty-three percent of respondents to Bluedot’s survey said they are more likely to open a store credit card. Among the perks they want in a store credit card are discounts, gift cards, or loyalty points.
This article was written by Tatiana Walk-Morris from Retail Dive and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to firstname.lastname@example.org.
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