Laybuy: The Smart Way to Pay
Franklin D. Roosevelt once said—“Happiness is not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort.” Having said this, it’s time to mention a moment of joy that filled the organisation of one of the clients of Laybuy. The reason behind this joy was a sense of achievement that the organisation had accomplished—an average order value uplift of forty percent. Their basket size has increased ever since they have bought Laybuy on board. Today, the firm offers online shopping across different brands, and Laybuy does forty-six percent of their sales. In the brief time since its inception in May 2017, Laybuy now holds the dominant position throughout the New Zealand market as the largest omnichannel ‘Buy Now, Pay Later’ platform with over 1200+ online and physical stores and more than 100,000+ consumers using Laybuy.
Through its research, the firm observed that consumers often waver in their decision to buy the products they want as they cannot afford the total purchase price of the items in their cart. In years gone by retailers offered customers an in store layby or layaway service to assist their customers but this was not available to online shoppers.
The traditional layby (or layaway model) has been an issue for Merchants for many years. Under the traditional model the retailer has to store the products and has to administer the payments from each consumer until the product is paid off.
We get more than 1.4 million site visits a month, that's generating new customers for our retailers as an increased basket size
So, to cater to this very fundamental challenge for the consumer and the retailer, Laybuy has built a platform that is very easy for the consumer to sign up and provides them with a weekly payment option.
The consumer buys the product and pays Laybuy one-sixth of the total purchase cost on day one. The remainder is paid off in 5 weekly instalments – interest free. “More and more consumers are seeing Laybuy as the smart way to pay because its interest free,” says Gary Rohloff, Founder and MD, of Laybuy. Laybuy pays the merchant overnight the full transaction value less a Laybuy commission fee.
“To use a simple example, consider a customer who wants to buy a pair of pants that are retailing at (say) one hundred twenty dollars. When they pay by Laybuy it's a twenty dollar purchase on day one and $20 every week for the next 5 weeks. That’s what drives the value for the consumer and the retailer.”
Laybuy assumes all the credit and fraud risk on every transaction and pays every merchant within 48 hours of the purchase. Laybuy has enabled merchants to increase sales and grow their basket size. “We get more than 1.4 million site visits a month, that's generating new customers for our retailers and increased conversion rates too.” says Rohloff.
Having received many complimentary emails from consumers and merchants alike, Rohloff is particularly proud of an email that a mother had sent to Laybuy. The message read, “This is the first time that I have been able to buy my children raincoats at the start of the season and not have to wait till they go on sale to afford them.” The success that the firm has achieved in their short operational term sees them plan to offer their product to Australia by the end of March.
Laybuy’s development team is continually reviewing customer feedback so that they can tweak the offer and make it simpler.