The way shoppers choose to purchase is ever-shifting, and itโs imperative that retailers and shoppers this Black Friday adopt these different payment methods to encourage a successful Black Friday for all. In the current economic climate, customers are finding more ways to pay than ever before to help delay or minimise expenses associated with Black Friday shopping. This annual shopping frenzy has evolved into a unique consumer phenomenon, characterised by long queues out the door, impulsive purchases, and a heightened sense of urgency. But one particular space that continues to grow on Black Friday is the online retail space, with many shoppers looking to bag the bargains from the comfort of their home. Retailers who fail to adjust to these shifting expectations risk a gloomy Black Friday.
Black Friday is a mammoth opportunity for retailers to capitalise on spending for the Christmas holiday period. However, consumers in Britain are tightening their purse strings and are more cautious with their spending in the current economic climate. This poses a new challenge to retailers who are still looking to maximise their Black Friday.
High energy bills, rising food prices, and a variety of expenses affected by inflation have tested British consumers. Amid these challenging economic times, weโre seeing a shift in the way consumers are spending.
This reduced spending power on Black Friday limits the opportunity for retailers to use traditional sale methods to reel in their customers, forcing them to think outside the box to try and win sales. This is leading retailers to run promotions beyond just Black Friday, seeing retailers post offers throughout Cyber Monday and even the whole month of November. Placing a significant amount of spending pressure on consumers on one day of the year doesnโt lend itself to the spending patterns reflected by the current economic struggles.
Finder research also suggests that the average spend per person on the Black Friday weekend will be down 40% from 2022. This reduced spending power will certainly impact the way that shoppers look to purchase this Black Friday.
According to Finder, 8 in 10 members of Generation Z, aged 18-23, intend to make purchases during the sales and their average spend will be approximately 56% higher than the national average.
Not only will Generation Z be one of the largest spenders this Black Friday, but dotdigital conducted research finding that 84% of Gen Z shoppers believe that Black Friday deals offer good value. Many shoppers are sceptical when it comes to sales and high-pressure days like Black Friday that encourage a more impulsive spending nature. However, Gen Z are particularly savvy shoppers, using all resources available to help bag a bargain. It looks likely that retailers will need to adapt their strategies to target this important demographic to ensure a successful Black Friday.
The landscape of spending methods is changing and retailers need to adapt to changing customer demands to be more inclusive this Black Friday. E-Commerce is helping to overcome barriers, not only geographically but demographically, and with the right strategy businesses can sell this Black Friday virtually anywhere to anyone - MultiSafePay.
Providing multiple payment methods can increase geographic coverage, providing payment methods that are universally accepted and popular within different countries. For example, iDEAL is the most popular payment method in the Netherlands, used by 90% of their online shoppers. Whereas BNPL payment options like Klarna are particularly popular in Germany.
Having limited payment options can be a deterrent to shoppers this Black Friday and can damage the user experience. The current retail environment needs to be responsive to customer wants and needs, and those who arenโt will suffer in the world of retail personalisation. Personalising the retail experience is important for capturing consumers, in particular, younger generations. Providing multiple payment options is an important part of personalising the retail experience towards your main consumers.
Not only can offering multiple payment methods improve the customers’ experience, but it also improves conversion rate. One of the biggest points of the purchase process retailers lose customers is at checkout, so itโs important that retailers provide payment options that will make checkouts easier and more streamlined.
Data collected by quantilope shows that 72% of shoppers will be paying for their Black Friday purchases using a debit card, and 48% will use their credit card.
Unsurprisingly, debit and credit cards remain the most popular payment methods, and offering this is nothing unique. However, finance editor Salman Haqqi has revealed that all expensive payments on Black Friday should be done via credit card, especially if youโre looking to spend more than you normally would. Not only does a credit card allow you to pay for things at a later stage when money is more readily available, but it also offers extra protection against faulty items that you wonโt receive from the retailer alone.
E-wallets, also referred to as digital wallets, are an increasingly popular way for consumers to pay. According to checkout.com, 53% of consumers in the UK use E-wallets from providers such as Apple Pay, Google Pay, and PayPal. E-Wallets act as a convenient way for you to store your payment details, enabling quick and simple payment, without the need to carry around your real wallet. Largely used on mobile, E-wallets are important for driving conversion rates and are an important payment option considering over 55% of web traffic comes from mobiles.
Not only do E-wallets improve the ease of checking out, but they also increase the enjoyment of the experience. Studies (Gogoi, 2017) identified that there was greater satisfaction in using E-wallets which compelled users to make greater purchases.
Despite the increased use of E-wallets, many retailers havenโt responded to this payment method, and it is established that 60% of consumers are likely to abandon their carts should they not be able to pay with their preferred payment method. Showing the importance of providing E-wallets as a payment method to ensure smoother transactions.
Given the current financial climate, many shoppers are using BNPL payment options to spread their spending with 26% of the UK planning to use BNPL as a payment method this coming Black Friday, with the largest demographic of those users coming from Gen Z - quantilope. The adoption of BNPL payment methods like Klarna has seen a meteoric rise, with 53% of BNPL payments being made through Klarna in 2021 - BusinessofApps.
For a successful Black Friday retailers must consider the preferences of their users within the wider macroeconomic environment. BNPL schemes are essential for making Black Friday purchases more accessible and flexible, helping consumers spread their expenses by providing instalment options and other forms of non-traditional payment. According to the Fintech Herald, the use of BNPL saw a greater uptake following the COVID-19 pandemic, with young adults spearheading alternative payment solutions.
globalpayments have analysed that BNPL has actually been an incentive for consumers to purchase with retailers, advertising BNPL at multiple parts of the consumer journey. BNPL makes products feel more affordable and therefore accessible, encouraging greater interaction with goods or services during the decision-making process.
This sector has grown rapidly, largely due to a lack of regulation and government interference. According to GlobalData, BNPL is largely used across 5 key categories, including food & drink, health & beauty, media & entertainment, electrical goods & home appliances, clothing & footwear footwear, capturing 60% of BNPL transactions in 2023.
Prepaid cards are a fast-growing sector, with many shoppers looking to use prepaid cards to help them through expensive periods such as the Christmas holidays, and obviously Black Friday. Over the coming 5 years, the total value of digital prepaid card transactions is set to reach $3.98 trillion, according to research conducted by Juniper Research.
The coronavirus pandemic accelerated the adoption of prepaid cards. Prepaid cards offer a convenient and safe alternative to those who donโt have access to or donโt want to use traditional banks. Prepaid cards are also a particularly popular incentive to purchase with there being an increase in customer rewards, such as cashback. Prepaid cards are becoming more commonly found within promotions, and hence their usage and the value of money spent in this way is increasing. This is something that retailers need to be receptive to.
Cryptocurrency is often a misunderstood concept and because of this can seem scary to many retailers, which is understandable. However, retailers need to wake up to the increasing number of individuals using and investing in cryptocurrencies, with a large market of consumers ready to spend their amassed crypto wealth. Within the crypto market, there are no geographical or financial boundaries with these payment methods being universally accessible and therefore spendable.
Businesses like Alo Yoga and Gucci have already expanded their payment options to allow consumers to pay with cryptocurrencies. This not only comes with the benefits of helping future-proof businesses, but it also can benefit brand image, showing that the brand is switched on and forward-thinking.
According to The Wall Street Journal, there are a staggering 220 million people who use cryptocurrency1 as a payment method, paying for everything from travel to sports tickets. An overwhelming number of retailers currently accepting cryptocurrency as a payment method (93%) have seen an uplift in their businessโ customer metrics, including both the size of their customer base and their brand awareness.
All of this makes those spending with cryptocurrencies this Black Friday a consumer base for retailers to be aware of and accommodate for.
When shopping this Black Friday, itโs important to consider how you can use these payment options to your advantage. Either increasing your ability to spend this Black Friday, or making logical and informed decisions about your purchases.
Make sure you are correctly budgeting your spending this Black Friday. We understand how easy it is to be lured in by the fantastic deals this Black Friday, but be sure that you are aware of your budget. Avoid landing yourself in a position of overspending. The best way to do this is to prioritise what you want to purchase and make sure you compare prices to other retailers to ensure you are actually getting the best price.
Many retailers will start releasing their Black Friday deals ahead of the actual event. This can help you plan for how you want to spend your budget. This will make you less susceptible to panic or impulse buying on Black Friday.
Whilst BNPL options are a good way of delaying expenses, itโs important to plan for future expenses to ensure that you can pay for those items without penalty. If this isnโt something you are cautious about then it can lead to payments with interest and can damage your credit score.
Some banks and payment services offer incentives to sign up by offering rewards to new users. Keep your eyes peeled this Black Friday and increase savings even more by capitalising upon these incentives. It isnโt uncommon for banks to offer financial rewards to new users. So adopting new payment methods this Black Friday will help you buy for even less.
To conclude, itโs incredibly important for retailers to offer a variety of payment options this Black Friday. When considering the shifting landscape in the way customers look to purchase items this Black Friday and the current economic climate, itโs easy to see why BNPL payment methods and more are becoming increasingly popular. The times of being able to capitalise on this singular day and prey on the excitement of the savings is simply no longer enough.
Make sure you donโt spend more than you should this Black Friday. Keep your eyes on Love Discount Vouchers to bag the best deals this Black Friday. Check our Black Friday discount codes to make sure youโre always bagging the best bargain.
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