Dive Brief:
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With its "Shop like a Queen" marketing campaign featuring famous drag queens like Aquaria, Asia O'Hara, Kim Chi, Naomi Smalls and Violet Chachki, Klarna, the payments platform, announced its "shop now and pay later" direct-to-consumer app, according to the company's press release.
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With the app, consumers can pay down purchases in four installments with no interest or added fees. The app also allows users to create wishlists across various platforms, receive notifications when prices drop and view editorial and influencer-created content, the company said.
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Though the company already has a network of merchants, Klarna said that it is opening its service to consumers across all merchants, including those that have competitor alternative payments programs.
Dive Insight:
By offering a flexible, fee-free payment option to shoppers, Klarna's payment launch appears to be aimed to attract millennials who have significant buying power and seek simple shopping experiences, but are wary of credit cards. The Great Recession and their decision to take on student loan debt could be the reason why this generation has declined to carry credit cards. Though younger consumers, Gen Z in particular, have been driving the mobile payments trend, many consumers continue to rely on cash.
"The demand for personalized shopping and ease of transactions are no longer trends in retail — they are now requirements," Klarna's Chief Commercial Officer Michael Rouse said in a statement. "Streamlining the digital shopping experience, from product searches to point of sale, allows consumers to not only take control of their purchases and on their terms — it also enables diverse, curated styles."
Allowing all merchants to participate on the platform comes at a time when retailers are looking for strategies to improve their overall shopping experience. Last fall, for example, H&M invested $20 million into Klarna and integrated the payments platform across 14 European countries. H&M's investment came when the company turned to big data and artificial intelligence to customize assortments in stores and boost its sales.
