When developing the strategy for the retailers’ business plan, George Pich, chief marketing officer, told Keyzar Jewelry management looked at each other and wondered what they had in common with their customers.
“We realized we were all in our 30s and tended to be broke, but that doesn’t mean we don’t want or deserve a beautiful piece of jewelry to be proud of,” he says.
High jewelry brand Keyzar Jewelry launched its online business on Etsy, Inc. more than two years ago with an average order value of $1,000. It sells engagement rings with Moissanite, natural and lab-grown diamonds, bracelets and other pieces. The Etsy shop took off, becoming a star seller, and Pich says the company knew then it had an enthusiastic following. Etsy’s featured sellers have a five-star review history, on-time confirmed shipping, and quick responses to customer inquiries. Keyzar still sells items in his store on Etsy.com.
“We realized we wanted to meet the needs of people like us,” Pich says. “We decided to see ourselves as the jewelry brand that cares and understands millennials and Gen Z. You can still get the proposition you want, even if you don’t have a big budget.”
Keyzar Jewelry offers buyers the choice to buy now, pay later
With prudent spending in mind, Pich says it made sense to offer buy now, pay later (BNPL) when it launched its direct-to-consumer offering. website in January 2021 with Shopify’s PayPal and Shop Pay installment payment options. But shoppers told the online retailer via its Contact us web page they also wanted Klarna.
In May 2021, Keyzar Jewelry launched Klarna as an BNPL option. Within 30 days, Pich says customers shopping with Klarna began to increase average order value purchases. Conversion rates increased by around 6% the first month and additionally another 5% the following month.
“Our conversion has increased by 11% in total in these first two months,” says Pich. Overall web sales were up about 14%, he says. Keyzar Jewelers declined to provide their overall conversion rate or higher AOV level when customers used BNPL.
With an average order value of $2,500, which is above her Etsy.com store’s AOV, offering BNPL choices at checkout is a natural fit, Pich says.
BNPL payment options are not the same. Each offers different features and all require approval based on the buyer’s credit history. Consumers are increasingly turning to the payment method as BNPL accounts for 2.9% ($157 billion) of the global value of e-commerce transactions in 2021 and is expected to reach a share of 5.3% (438 billion) of the global value of e-commerce transactions by 2025, according to “The Global Payments Report”, published in March 2022 by Worldpay, a payment processing company owned by FIS, a global payments technology company .
Overall, Klarna leads the way, followed by Afterpay and PayPal, according to the report. In the United States, BNPL is becoming increasingly popular, with almost 35% compound annual growth rate (CAGR) of e-commerce predicted through 2025. CAGR is the rate of return that would be required for a investment grows and is measured between two given years. The report collected data from 41 selected markets around the world, offering real-time payment options both online and in-store.
As BNPL options grow in popularity, a key benefit for retailers is attracting younger consumers looking to break down more expensive items. These elements
this could otherwise be funded by payments made using traditional credit cards and paid for by carrying the balance, says Jed Danbury, vice president of global payment services provider Computop.
“While already popular overseas, the BNPL received a boost in the United States during COVID-19 as it enabled cash-strapped consumers to make partial payments at home. advance, then for a short period,” Danbury said.
Various buy-it-now and pay-later options
Klarna allows buyers to split payments into four interest-free transactions up to $10,000. Customers can also pay in 30, which is when someone buys items today, returns what they don’t want, and only pays for what they keep. If a customer decides to pay later with financing, they can select a payment plan.
Shopify offers Shop Pay, which allows shoppers to pay in full at checkout or split their purchase into four equal interest-free installments. But orders are limited between $50 and $3,000.
PayPal will divide the total price of an order into four equal installments, due every two weeks, with the first payment due at checkout. Customers can refund purchases between $30 and $1,500.
Klarna, Shop Pay and PayPal all charge Keyzar Jewelry a fee of around 2%, says Pich.
Pich says Klarna is by far the most popular choice among its customers, with almost 75% choosing to use Klarna when selecting BNPL at checkout.
On the retail side, Klarna easily integrates with their Shopify website setup, says Pich, which takes a few weeks to go live on the website. Pich did not specify how long it took to integrate Klarna with its Shopify website.
The retailer is not looking to add additional buy-it-now and pay-later options at this time, but continues to listen to customer requests, Pich said. Keyzar Jewelry has a large international customer base, but it plans to add Venmo as a payment option in 2022 because it’s a popular payment option for its US customers, he adds.
The overall goal of adding checkout buttons is to provide a secure shopping experience for customers while providing options that don’t require a long wait time to save enough, Pich says.
“Since we sell engagement rings with an AOV of $2,500, flexible payment plans are a big deal for our consumers,” he says. “It’s a privilege to be a part of our clients’ lives and help them make the proposal or give the gift they really want, and that’s special.”
As an international brand, Keyzar Jewelry has both customers and employees all over the world. As the Russian invasion of Ukraine continues, the online retailer is experiencing a direct impact on its business as it employs remote workers in Ukraine across its illustration, development and content teams.
“Artwork, development and content have all slowed down because these people are hiding or evacuating,” Pich says, adding that one of the employees is currently fighting for Ukraine.
Pich and one of the brand’s partners have family and friends in Russia and Ukraine.
“We all see people we know losing their livelihoods in both countries because of this,” he says. “He’s tough. We spend a lot of time watching the news and wondering what’s going to happen.