With a young, tech-savvy consumer base, MiaDonna, an online jewelry retailer specializing in ethically sourced lab-grown diamonds, wanted to be up-to-the-minute with its payment options as well. The retailer selected financing company Affirm, enabling shoppers to pay in three-, six- and 12-month increments.
MiaDonna, which now makes approximately 20% of its sales through Affirm, noted that shoppers using the service are both spending more and coming back. Affirm users make 17% more repeat purchases, with average order values (AOV) that are 36% higher compared to non-users.
"For us, we wanted to be able to offer our consumers a way to purchase these higher-price products without having to make that upfront payment," said Andrew Puddifoot, General Manager of MiaDonna in an interview with Retail TouchPoints. "We know that right now, most consumers don't have the disposable income that their parents may have had. We want to make sure that we're offering the most affordable product possible, and options that will allow them to have their engagement ring or wedding band immediately."
Transparency Creates Trustworthy Payments Experience
MiaDonna had previously leveraged PayPal for its financing option prior to working with Affirm, but consumers cited low approval rates, poor customer service and a clunky application process as reasons for a subpar experience. Despite these issues, the MiaDonna team knew that demand was there: approximately 6% to 10% of shoppers made purchases via PayPal financing.
In choosing Affirm as its new partner, the retailer discovered that it was critical to work with a company built on transparency, particularly in listing payment fees.
"Unexpected fees have always been the biggest pushback we've had from customers," Puddifoot said. "Affirm has been able to alleviate that for us because we just don't seem to get that any more from consumers. It seems like they're pretty clear on their payments straight away. They know what they're being approved for, they know when their payments are going to end, and they know what their total cost is going to be."
Simplified Integration Wins Out
The financing option is designed to integrate seamlessly into the MiaDonna e-Commerce payment experience. Monthly rates are included directly on product pages to give consumers the option upfront, or even to introduce Affirm to those who have never heard of the platform. The pages also include an option for non-users to "pre-qualify" for Affirm on the spot, as long as they provide basic information to verify their identity.
"Based on the way Affirm would integrate with an e-Commerce site, we knew that it would have to help create an uplift in conversion rates, which it did," Puddifoot said. "The biggest win for me is the increase in average order value. These are funds that we potentially wouldn't have seen if it wasn't for financing. Even with the financing-as-a-service fee in consideration, it benefits us to have financing in place just because we can push shoppers to items they previously may not have been able to afford."
Latest from Glenn Taylor
- Amazon Devices, Grocery Perks Drive Prime Day 2018 Customer Retention Strategy
- Exclusive Q&A: How Perry Ellis International Took Fashion Forward With A Technology ‘Pitch-Off’
- Prime Day Drives Reported 89% Sales Boost In First 12 Hours Despite Early Site Crash
- For Top Retailers On Prime Day, Expect High Revenues But Thin Margins
- TAYLRD Tours The U.S. With Airstream Pop-Up Experience