Cautious consumers are pulling back on spending. According to a recent Gallup poll, 51% of consumers are spending less in recent months than they did previously, a 19-percentage-point hike over the year-ago period and a level not seen since the Great Recession of 2009-2010.
In a bid to overcome buyer hesitation, women’s fashion retailer ModCloth is offering a no-interest deferred payment plan from Klarna that allows online customers to pay in four biweekly installments. A pink banner on the Web site home page encourages customers to “treat yourself to something you love now. Pay for it later.”
“We believe that our core customer craves diversity and flexibility in her shopping journey,” said Jeff Streader, Co-CEO of ModCloth in a statement.
If a customer chooses the pink “4 Easy Payments with Klarna” button at checkout, she will be shown the amount of each payment — equal to one-quarter of the total — that will be automatically charged to her credit card, and when the subsequent payments will be charged.