Dive Brief:
- Consumer orders that tapped buy now-pay later financing from Afterpay more than doubled for the U.S. holiday week from Nov. 21 through Sunday, Nov. 27, compared to the first week of October, financial services parent company Block said Tuesday. The data included online and in-person sales. The company declined to share the number of orders.
- The fastest-growing categories for Afterpay use were for food and beverage, hardware, travel, automotive and footwear, among others, Block said. Leading into the holiday season, Block reported that it expected one in six U.S. shoppers planned to use BNPL to manage spending.
- From Nov. 24, Thanksgiving Day, through Monday, Square and Afterpay sellers tallied about 61 million transactions globally, Block said. A spokesperson for the company said Block didn’t have comparable data for 2021 because this was the first year Square and Afterpay seller data were combined following Block’s purchase of the Australian buy now-pay later provider.
Dive Insight:
This year, 80% of consumers plan to spend the same on gifts if not more than last year, Block predicted earlier this month. But with inflation squeezing budgets and credit card interest rates creeping up, more shoppers might turn to BNPL to spread out payments.
About 37% of shoppers expect to use BNPL this season, Deloitte said recently. Other survey findings put that figure at 20%. U.S. BNPL payment volume is projected to reach $75.60 billion for 2022, according to Insider Intelligence.
Across online BNPL providers, revenue on Thanksgiving Day grew 1.3% over last year, with orders up 0.7%, Adobe data indicated. Between Nov. 19 and Black Friday, online orders tapping BNPL grew 78% compared to the week prior, Retail Dive reported.
Also notable: The average order value for U.S. BNPL purchases fell by 6% last Thursday, Thanksgiving Day, suggesting consumers are turning to the payment method for smaller purchases, the software company Salesforce said.
For its part, commerce company Shopify also said Tuesday merchants using its services notched $7.5 billion in sales during the Thanksgiving weekend – a 19% increase over 2021.
