Buy now, pay later surges for groceries
What this means: BNPL is entering its prime this year. For many consumers, it’s the perfect solution to turbulent personal finances and rising costs. BNPL is the younger generation’s savvier version of layaway, but for consumers who are racking up credit card debt or having difficulty in paying bills after the pandemic, it’s a solution that’s tailor made for today’s retail environment. BNPL usage in essential categories provides a huge relief to consumers in their everyday purchasing, but consumers aren’t always fully educated on the long-term impacts of these programs if not paid back on time.
Currently, interest in BNPL services is slightly lower for millennials (42%) than Gen Z (50%), according to GWI.
“Millennials are most likely to use BNPL for the convenience, while Gen Z and all other gens prefer how it lets them spread out payments,” Chris Beer, data journalist at GWI, told Retail Leader Pro.
Continued economic uncertainty is projected to continue to drive many shoppers to delay payment for purchases by leveraging BNPL options online shopping.
“E-commerce demand has remained resilient in an uncertain economic environment, driven in part by lasting pandemic habits where consumers had no choice but to leverage online food and home furnishing shopping services,” Pandya said. “Now consumers have embraced the rich e-commerce experiences that made them feel comfortable getting these necessities delivered to their doorsteps, making these categories new growth drivers in the digital economy.”
What’s next: With economic uncertainty rising, the usage of BNPL may only increase throughout the remainder of the year. The question is what types of purchases that consumers do next for BNPL? With the service allowing consumers to defer and split payment instead of racking up debt and interest, experiential purchases may be prime for this type of alternative. However, it’s clear that consumers are focused more on satisfying their needs vs. wants, and that essential categories like grocery and drug will likely sustain programs this year.