By the numbers: Zip Fest—Zip’s preholiday shopping event held from October 21 to 25—was a smash for the provider.
Why it matters: Zip Fest could foreshadow Zip’s performance during the holiday season, which is projected to reach $1.147 trillion in US retail sales, according to eMarketer forecasts from Insider Intelligence.
As customers prepare to spend, appetite for BNPL is intensifying: 60% of Australian consumers and 47% of UK and US consumers have used a BNPL solution, according to Marqeta. That could pull customers away from legacy payment methods, giving providers an opportunity to capitalize on the season.
The bigger picture: Zip and other entrenched BNPL players (like Afterpay and Klarna) are facing greater competition from issuers and card networks that have introduced their own BNPL solutions. This is pushing providers to seek out greenfield in untapped sectors rather than going head-to-head with rivals for market share.
That will become increasingly important as the industry diversifies and expands, as shown by three recent developments:
What’s the catch? Incumbents are also competing with credit cards. Last year, pandemic-driven uncertainty pulled customers to limit credit card use, opening the door for BNPL firms to grab market share and boost volume. But credit cards have made a major comeback in recent quarters—which has pushed providers to ramp up partnerships, new product releases, and global expansion efforts to help sustain last year’s growth.
Go deeper: Check out our "Buy Now, Pay Later Report” for a high-level view of the industry.
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