PayPal Credit Gives A Boost to Small Businesses
Apr 13, 2017 2:00 PM ET
As the General Manager of Small Business in North America at PayPal, I’m lucky to be able to spend time with our customers to hear firsthand what tools and services they need to help them grow and thrive. Listening to your needs helps us build new products and tailor existing solutions – whether it’s helping you get access to capital or accept payments online, in-app and in-store. In the end, our goal is to help you attract new customers, increase conversions, sell more and, ultimately, grow your bottom line.
One recent trend I’ve noticed is the sales growth small businesses see when they offer their customers flexible financing options like PayPal Credit. It’s a convenient way for customers to buy products now, but spread out payments over time. Meanwhile, you, the small business owner, gets paid up front and doesn’t assume any risk by extending credit to your buyers. Most importantly, it can also help improve conversion and increase sales, particularly for big-ticket items. In fact, some small and mid-size merchants saw up to 68% larger transaction sizes for customers using PayPal Credit compared to credit or debit cards.1
The three businesses below have benefited from utilizing PayPal Credit’s flexible repayment options to attract new customers and increase sales:
- Dave’s Guitar Shop: Since adding a simple banner to their website touting the availability of PayPal Credit financing, total sales at Dave’s Guitar Shop in Wisconsin grew by 18%. In addition, PayPal Credit accounted for 14% of overall online business and 37% of overall sales growth. The number of PayPal Credit transactions increased 93%, compared to only 14% growth of other transaction types.
For Tylor Fischer, sales manager at Dave’s Guitar Shop, “It’s a no-brainer. It helps customers find a way to pay you: a six-month promotional financing solution that’s really easy to use.”
- CP Performance: In one year since integrating PayPal Credit on their site, global marine parts supplier CP Performance grew sales by 19%, and the number of transactions over $99 increased by 23%.
According to CP Performance’s President Mike Mays, “Credit makes it easier for the customer. If it’s a big-ticket item, they have the opportunity to pay for it in six months. At the end of the day, you just have to make it as easy as possible for the customer to find and buy the part they need.”
- Blockbuster Costumes: Blockbuster Costumes also saw the benefits of having PayPal Credit, and in just one year the Buffalo, New York-based business experienced a 55% increase in sales, 97% growth in transactions over $99, and 43% growth in PayPal Credit transactions over $99.
Dan Karyczak, marketing coordinator at BlockBuster Costumes says, “We saw the need for our customers, and it was a win/win.”
While consumer financing isn’t for every retailer, an offering like PayPal Credit can deliver clear benefits for businesses of any size and provide customers more flexibility on how and when they want to pay.
1 As reported in Neilsen’s PayPal Credit Average Order Value Study for activity occurring from April 2015 to March 2016 (small merchants) and October 2015 to March 2016 (midsize merchants), which compared PayPal Credit transactions to credit and debitcard transactions on websites that offer PayPal Credit as a payment option or within the PayPal Wallet. Nielsen measured 284890 transactions across 27 mid and small merchants. Copyright Nielsen 2016.
Amit Mathradas, General Manager of Small Business in North America, PayPal