ONLINE RETAIL A single solution for multiple channels Today’s technology allows retailers to also offer payment by private label credit card both in-store and online. By doing so, they can increase revenue, eliminate costly credit card fees and build loyalty through repeat purchases, wherever their customers are shopping. While Canada’s e-commerce market has trailed that of other advanced countries, Canadians are beginning to fully embrace online shopping. In the coming decade, Boston Consulting Group expects that more than 35 per cent of Canadian retail sales growth will be delivered online, up from 7 per cent today4. This context creates opportunities: and new challenges to stay relevant. To keep customers coming back, Canadian e-retailers need to offer a seamless check-out experience including a choice of online payment options. Offering payment options at checkout also helps them contend with a real challenge: shopping cart abandonment. According to a study conducted by PayPal in partnership with comScore Research, 53 per cent of PayPal credit users would not have made all of their purchases without PayPal Credit5. Offering financing at the point-of-sale (POS) can also help to increase average order size. For example, PayPal Credit users have transaction sizes up to 68 per cent larger, according to Nielsen’s PayPal Credit Average Order Value Study6.
financial services industry. Prior to founding Flexiti Financial, he served as EVP at Sears Financial and Home Services, SVP at President’s Choice Financial and SVP Citi Cards Canada. Peter received his MBA from the Richard Ivey School of Business in 2001. 1 Retail Council of Canada “Fast Facts and Q&As”, online, https://www.retailcouncil.org/fastfacts-and-qas-0 2 Gary Sands, “Canadian shoppers pay when Visa and MasterCard squeeze small business”, Financial Post, opinion, May 8, 2017. 3 AMEX Canada, “Introducing American Express Installments: A New Way to Pay for Purchases Over Time”, press release, November 1, 2016. 4 Dan Bodley, Peter Dawe, Sam Ridesic and Matthew Mackenzie, Boston Consulting Group, “Will Canadian Retailers Meet Demand as E-Commerce Takes Off?”, report, June 12, 2017. 5 PayPal, www.paypal.com/us/webapps/mpp/promotional-financing 6 PayPal, www.paypal.com/us/webapps/mpp/promotional-financing, ibid.
Technology innovations New innovations in technology have significantly streamlined the process of launching a private label credit card, with clear benefits for both retailers and their customers. At Flexiti, we have created the only POS lending platform that allows merchants to issue customers private label credit cards in-store and online. Our platform offers low rates for retailers who want to offer their customers flexible payment options, such as zero per cent interest financing. Crucially, the platform requires minimal POS integration and is easy to integrate into existing e-commerce engines. Within days, merchants have a powerful new payment option to drive sales and cut down on fees. Meanwhile, customers seeking flexibility get to choose a payment schedule that fits their needs. The checkout process is simple and requires neither an existing credit card nor a lengthy paper application. They can simply select “Pay with Flexiti” at checkout, apply and receive approval for Flexiti’s virtual private label credit card within minutes.
Cards’ untapped potential Launching a private label credit card is now no longer an unwieldy process, thereby allowing more retailers to reap the benefits of offering open credit to their customers. They can provide financing to drive sales, increase average purchase value and encourage repeat purchases. They also can build customer loyalty in the new omnichannel retail landscape. And, finally these merchants can drastically cut fees on regular credit purchases, thus creating instant savings to reinvest into their businesses or put towards the bottom line. Peter Kalen is founder and CEO of Flexiti Financial, Canada’s leading POS financing platform for retailers and a leading issuer of private label credit cards. Peter is a seasoned credit card and retail executive with over 25 years of experience in the July/August 2018
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