33% of French people have used online payment facilities in the last 12 months, according to the Access Panel of L’Echangeur BNP Paribas Finance. In detail, 27% paid for their online purchases in several installments (3 or 4 installments, for example) and 19% resorted to payment deferral, either payment after receiving and trying out the products, or payment deferred for several weeks or months. And these numbers increase if we focus on the younger generation. Clearly, payment now goes into the service box, as do delivery terms. The context of inflation and pressure on purchasing power could reinforce the attractiveness of this type of service…
Le Petit Ballon, which generates 23 million euros of turnover, including 16 million euros online, mainly through the sale of subscription boxes, has noticed this trend. DNVB (Digital Native Vertical Brand) has been offering its customers the Buy Now Pay Later service since June 15th, in partnership with Django, the new fintech of the La Poste group. For Ugo Psaltopoulos, administrative and financial director of Le Petit Ballon, this type of service should be consumed in moderation, like the wines sold on his e-commerce. “We were wary of the buzz generated around excessive consumption”he says.
A choice of partner according to technology and values
Hence the choice of Django as a technical partner. In fact, there are several players who are entering this type of service, whether they are historic banking players like Oney or Floa Bank, or more recent players like Alma, Klarna or Clearpay. But fintech from La Poste, the latest arrival on the market, is advancing in the market with a similar service, but different values, mainly in relation to over-indebtedness. “These are not just words, our approach is based on concrete commitments, underlines Vanessa Lavergne, Director of Marketing at Django. Our ambition is to offer a shopping service experienced or chosen that are part of an occasional approach. We do prevention on excessive consumption. We partnered with Cresus to monitor and manage their budget and with Carbo, which allows customers to calculate their carbon impact”🇧🇷
Technically, the Django solution was designed to easily connect with the three main CMS on the market (Prestashop, Magento and Woocommerce). Offer 3 to 4 times with or without fees, scoring on the menu with immediate results. In the case of Petit Ballon, this service is not open to everyone. “It is offered at the end of the course to all baskets over 200 euros, says Ugo Psaltopoulos. In 5 months we carried out more than 120 transactions knowing that the average basket of this type of service reaches 320 euros. We aim for around 1% of our turnover to be paid using this payment method. We are waiting to measure the effects on Christmas sales to fully measure conversion. 🇧🇷
Higher transaction cost
On the billing side of the service, as with all means of payment, Ugo Psaltopoulos points out that this could have an impact on the margin. Neither DAF nor Django communicate the cost of the transaction, emphasizing that the price depends on the volumes realized, the sector and the risks incurred in terms of default… On the other hand, the advantage of BNPL is that Le Petit Ballon charges the amount total on the day of the transaction. Django bears the technology cost of other future payments and assumes the potential risk of payment defaults.
If the cost of payment is higher than that of a bank card, the height of the average baskets – 320 euros with BNPL against 120 euros with a card – encourages greater mobilisation. Le Petit Ballon therefore intends to offer it at the beginning of the purchase tunnel. “We are going to carry out tests during the end of the year holidays to make the most of this service as a marketing lever, he indicates. And we are also thinking of including you in our loyalty program and thus encourage our community with this service and facilitate new purchases. 🇧🇷