Publishers Embrace Buy Now, Pay Later

Buy now, pay later (BNPL) technology, a financial tool sweeping the digital retail ecosystem, has found its way to the media industry, leading to improved conversion rates, higher average order volume and, ultimately, increased revenue for publishers. Media organizations including BuzzFeed, Bustle Digital Group, Gallery Media Group and Leaf Group have all adopted the payment methodology, which lets consumers purchase an item and then pay for it in installments. In a 90-day pilot period involving six publishers, the media companies saw increases of 2.5 times in both conversion rates and earnings per click, according to Melissa Davis, chief revenue officer at fin-tech company Afterpay. Deferred payment technology also allows publishers to experiment with offering higher price points and different products, a capability that has tripled the average order value. At the Gallery Media Group title PureWow, Afterpay products have accounted for 8% of its net orders via native checkout company Bonsai since launching in July, according to Emily Kerr, vp of content and growth at the publisher. The tech has led to a 3.5 times increase in orders and 2.1 times increase in conversion rates. The BNPL option has also helped the publisher improve its cart abandonment rates by more than 10%. Publishers like BuzzFeed, and soon Bustle Digital Group, have taken deferred payment tech a step further, marrying the tech with their new onsite shopping capabilities. When paired, publishers can replicate the experience of a contemporary retail website, letting customers browse, add to their cart and use deferred payment to purchase items such as beauty products, cookware and clothing. The combination not only boosts the bottom line of their commerce business, but it can also raise publishers’ CPMs and help them capture valuable data that the affiliate models leave them in the dark about. “If we want to compete against online retailers, we need to offer consumers the same experience and options as they do,” said Kate Robinson, svp of content distribution and partnerships at BDG. How BNPL works for publishers By reducing the amount of money a shopper needs to make a purchase, deferred payment providers like Klarna, Afterpay and Affirm can increase consumers’ propensity to purchase, leading to a boost in transaction volume. In exchange, the micro-lending companies make money by levying a fee on the purchases, generally between 2% and 6%. Most publishers already work with a third party, such as Tipser, Shopify or Bonsai, to provide the infrastructure for them to conduct their commercial efforts. To incorporate deferred payments technology into the process, these third parties must arrange partnerships with BNPL companies. BDG, which uses Tipser to power its commerce, is working with Affirm to introduce deferred payment options by early 2022. BuzzFeed, PureWow and Leaf Group title Well+Good all use Bonsai to power their commerce. In October, Bonsai announced it had partnered with Afterpay. For most publishers, the period of experimentation has been too short to yield concrete data, but early results are encouraging. On products where it offers Afterpay, BuzzFeed has seen a significant increase in its number of add-to-carts, said Nilla Ali, svp of commerce. Kate Spies, the svp of content, brand and growth at Leaf Group, said Afterpay has a similar effect as free shipping or a sale, both of which lead to higher conversion rates. “It gives people more flexibility,” Spies told Adweek. “Afterpay isn’t, in the end, giving people money off the product, but it is allowing them to space out the financial impact of their purchases.” Capturing more data and higher CPMs BDG introduced onsite shopping to its titles TZR, Bustle and W beginning in the spring, while BuzzFeed began incorporating the functionality on its site this summer. Onsite shopping gives publishers more visibility into what prompted a purchase and what a customer’s purchase pathway looked like. They can use this data to improve their editorial-commerce feedback loop. And when paired with the option to use payment deferral pricing, which increases conversions, the combination could be particularly effective. “It’s early, but the numbers have been promising,” Ali said. “It certainly seems that when users are given the option to not have to pay for everything up front, it does drive a higher add-to-cart rate.” Onsite shopping also transforms vast swaths of a publisher’s website into a potential purchase point, which could help publishers command higher CPMs. The technology moves publishers down several levels in the purchasing funnel, compressing the distance between discovery and purchase, according to Robinson. “Once users are accustomed to shopping in our environment, now we have an audience that has an intent to buy,” Robinson added.

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