Whenever we talk with businesses about what Credit Key has to offer, they always want to know how it will benefit them. It’s one thing to say, “We deliver a great customer experience,” and offering more flexible payment options as part of that. But for some businesses, that’s simply not enough.
CEOs and other leaders at B2B merchants justifiably want to understand the business case. Like anything in business, it’s important to understand the inputs and outputs of any system that the business may use. But because offering flexible payment options is a relatively new concept in B2B, it’s also something that’s sometimes met with skepticism. It’s so new that the business case doesn’t really exist yet. Luckily, we can turn to B2C e-commerce to provide us with the data we need to make an informed decision.
The Amazon Example
If you haven’t heard, Amazon Business is really taking off. What’s Amazon Business? Oh, it’s only the world’s largest e-commerce retailer’s foray into B2B e-commerce sales. Basically, they’ve taken everything they’ve learned over the years about B2C and are applying it to B2B. They have over one million customers, about 85,000 B2B sellers, and “hundreds of millions of products” just for B2B buyers.
And they’ve recently rolled-out “Pay by Invoice,” a payment feature that allows buyers to pay over time, while sellers get paid instantly. Amazon is now handling “all aspects of the invoicing process, including credit risk assessment, billing, and collection activities.”
If you know anything about Amazon, you know they’re a very data-driven company. And while they haven’t revealed any real insights into this new program, you can be sure they’ve tested it and found it to be highly profitable—for themselves and their merchants.
The truth is that if you’re a B2B merchant, you may one day be competing with Amazon (if you’re not already). Amazon is setting the bar for your buyers’ expectations, and if you don’t keep up, there’s a good possibility you’ll be swallowed up.
Flexible payment options lead to massive growth
If you’re looking for more concrete numbers, look no further than this case study on the effects of a pay-over-time system implemented on a luxury watch website. Crown & Caliber is a platform for buying and selling pre-owned luxury watches for men and women. Products are generally not cheap, with watch prices ranging from $800 to several tens of thousands of dollars. As you might imagine, most consumers are often hesitant to plunk down such large sums online, much less have larger amounts of credit available to them. Thus, implementing a pay-over-time system enabled them to attract and close far more sales, with a significant revenue.
Just how much? Well, conversions jumped 74 percent, while repeat buyers grew by a whopping 300 percent. Additionally, buyers spent more money, with a 74 percent boost to the site’s average order value. All of this resulted in a…wait for it…170 percent growth in revenue.
Please tell me what CEO doesn’t want to grow his or her business by that much?
This is precisely the type of growth that we believe Credit Key can offer. Want to learn more? Check out our ROI calculator or contact us for a demo and to see how offering better B2B financing options can boost your business.