Deko’s Checkout Finance Platform Helps Funbikes Shift Gears and Accelerate Sales
Funbikes shares insights on how Deko’s checkout finance platform – specifically its Newpay product, has helped them shift gears, accelerate sales and stay in the right lane by increasing customer retention.
Checkout finance is the understated trump card for retail, both online and in-store. The rise and advancements in mobile shopping changed consumer expectations but, with consumers spending more than 100 billion hours in shopping apps globally, the shopping platform is no longer a differentiator; it’s the norm. Instead, it’s how your customers pay, not how they shop, that can provide a competitive edge.
Consumers will always be attracted to convenience. Thanks to innovations in technology they can now shop in a myriad of ways, and have items delivered directly within a few steps.Tech companies have built the benchmark for a new seamless shopping experience, and this extends far beyond what people typically associate with a digital experience. For example, someone buying a scooter still wants the ‘Apple experience’. Online-only retailers or shopping apps have changed how consumers shop, but checkout finance has changed how they expect to pay both online and even in-store. Research suggests that nearly a fifth of UK adults use checkout finance services once a month. These figures are even larger for younger generations, who tend to utilise eCommerce for a large proportion of their shopping.
Whilst retailers have experimented with omnichannel and now, even AR, to bring the real-world experience up to ‘online standards’ and shift the ‘showroom’ phenomenon of bricks and mortar retail, the understated advantage today is the checkout finance platform. Research shows that the rate of mobile basket abandonment in 2022 was a staggering 81%; online stores are having to improve the checkout experience for customers to increase sales conversion.
Mark Storey, Director of Marketing at Funbikes, a retailer who is laser focused on how technology will keep them ahead of the game, commented:
“We’re not only competing against other merchants, but against the rate of innovation from other tech companies – in the sense that it used to be about how customers shopped, now it’s about how they pay; we have to keep up. It’s not just about the product – our bikes, for example – it’s about customers’ experience end to end. Fintech – specifically checkout finance – has become so ingrained in our everyday shopping habits, that we have to consider how the finance platform we choose to integrate will impact every step of the customer experience.”
Funbikes has been a customer oriented company from the outset. Founded over 20 years ago, the company manufactures and imports products (from electric bikes, to quadbikes, scooters, and more) which it sells directly to consumers without relying on wholesalers. This model intentionally enables them to offer the best value price without compromising on quality; the products available include the highest specification and reliable machines. Funbikes also prides itself on offering customers unlimited top-quality tech support; its customer service doesn’t end at the checkout.
Storey continued: “There has been a cultural shift in eCommerce: customers now expect finance options at checkout for all types of consumer goods and price ranges. It’s no longer enough to assume that by simply offering finance options, you’re meeting customer expectations. Now, we must ensure the finance products we integrate into our website are as customer-focussed as we are. Each step of the consumer journey must be as frictionless as the last. We must continually look to add value”
“Our type of product is heavily finance-driven; without a reliable checkout finance provider like Deko, we would struggle; nearly 20% of last year’s turnover, for example, was driven by Newpay. Since using Newpay, we’ve seen a huge acceleration in accepted applications, meaning more customers than ever before have been able to access finance. Not only is this naturally very positive for our business revenue, it also means that customers are provided with more options. They can shop the way they want to shop.
“Newpay has been instrumental in customer retention,” continues Storey, which is crucial to not only our business revenue but our business ethos. We care about all our customers, not just the new customer on the horizon. It’s harder than ever to nurture customer loyalty in retail, especially in our industry. By improvising the end to end experience of payment, and improving acceptance rates rapidly, we’ve been able to ensure our customers get the experience and the choice they deserve”
Newpay is an FCA regulated finance product that gives consumers a way to spread the cost of purchases. Customers only need to apply for a Newpay account once, which they can then use to repeatedly pay for purchases from a range of participating retailers. Newpay offers a smarter way for consumers to pay, with a range of fixed monthly instalments and the ability to consolidate multiple payment plans into a single monthly payment. Plus, as Newpay reports to credit reference agencies, customers can build their credit score by making repayments in full and on time.
Storey continued: “Brand experience is so important within retail, and the types of customers we serve include a hobbyist niche that will seek out the best value and share amongst them the best options for both costs and quality. What we weren’t happy with before integrating Newpay is that the customer was made to feel excluded from the best deals. With lower acceptance rates, clearly many customers were trying to use the option to pay with finance, but were declined. Therefore, instead of being able to buy the item at that limited-time promotional price, they were left with the only option to pay at a higher price at a different time. With the widespread integration of retail finance options in eCommerce, consumers now consider this when they look at the overall cost of a product. The way in which a finance option integrates into the shopping experience becomes part of the brand experience; it signifies the quality of the overall service. That’s important to us at Funbikes because every single customer matters and deserves the best value.”
“Just like we pride ourselves on high-specification machines and technical customer support, our DNA is in the detail. This does not stop at the checkout; it is our job to ensure customers are well-informed every step of the way in their shopping decisions. Importantly, the shopping experience extends beyond the initial purchase of a product. We want our customers to make sure they understand the costs, terms and key features of the finance options available, and they will see this information as they shop and at the checkout.”
“We felt the impact of Deko almost immediately,” shared Storey. “Deko has been consistently outperforming our incumbent finance providers – both in terms of conversion and number of applications. The Neway application is more intuitive and, overall, user-friendly. Crucially, customers don’t feel like it’s an addition to the shopping experience, or extra admin; it’s frictionless.”
“The finance application with the interest rate credit promotion drove approximately 17% of turnover in November 2022. In December we saw a similar figure,” expressed Storey. “We would attribute approximately one fifth of our business to the fact we offer a finance solution.”
“Deko has been instrumental in nurturing customer retention, which is incredibly important to our revenue, approximately 40% of which is from returning customers. Customer acquisition can cost five times more than customer retention so our business strategy centres on nurturing existing customer relations,” shared Storey.
A recent Gartner report found an 82% probability of repurchasing or renewal when customers felt valued from customer service interactions and a consequent 97% probability of positive word-of-mouth recommendations. Retailers can increase customer loyalty by performing value enhancement activities, improving confidence in the product and reassuring them of their purchase decisions. This is also why Funbikes’ customer service is extremely sharp. Every customer who is upset is potential revenue that we could lose.
“Newpay’s customer-focused design and the seamless integration of the technology has had a dramatic impact on our brand and our business’s bottom line,” concluded Storey. “People get best-in-class service from the moment they browse, either online or in-store, and that doesn’t end when they choose to pay”.
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