Giving your customers more ways to pay for big-ticket purchases makes it possible for them to buy what they need, when they need it. Flexibility is also a win for your online store—auto parts businesses, in particular, have discovered that consumer financing is key to helping increase average order values and building loyalty with shoppers.
How consumer financing helps drive sales for online auto parts retailers
For the estimated 40% of Americans who are not financially able to cover a $400 emergency expense1, buying the carburetor, air intake system, or new set of snow tires that they need can feel like a catch-22. Car owners rely on a vehicle to safely and comfortably get their families to school, work, and everywhere in between, but don't always have the money to pay for the expense all at once.
Fortunately, many online auto parts and accessories businesses now offer consumer financing to help car owners make large purchases they need to upgrade a vehicle or get one back on the road—think $100-200 for a battery, $500 for snow tires, and several thousand dollars for a new transmission. Consumer financing allows online shoppers to buy what they need now and pay for it over time.
While there are several options for businesses seeking to implement consumer financing, PayPal Credit2 is one of the largest online financing providers with more than 300,000 businesses in the auto parts industry offering PayPal Credit as a payment option.3 In 2018, customers who paid using PayPal Credit spent 20% more per transaction than shoppers who used other forms of payment.3 What's more, auto parts retailers saw 25% larger credit transactions when they promoted PayPal Credit with a message or button on their online stores compared to those who did not.3
Millions of online businesses are using PayPal Credit to help attract new customers, drive more sales, and provide shoppers with greater purchasing flexibility. Given the big-ticket items for sale in auto parts retailers' online stores, consumer financing is a particularly great fit in this industry.
AutoAnything, one of America's largest and fastest growing online retailers of specialized auto parts, grew their sales and increased customer loyalty since adding a consumer financing option to their website – nearly a third of PayPal Credit customers are repeat shoppers on their site.4 U.S. Auto Parts is experiencing similar success. “PayPal Credit is just another way to give customers choice in payment options," says CEO Aaron Colman. “PayPal Credit allows our customers to finance their purchase, and we have seen good adoption with our customer segment."
Adding PayPal Credit to your online store is a win-win for your customers' budgets and your bottom line. While shoppers are extended the convenience of paying for purchases over time, you get paid up front with no additional risk or additional fees. With a payment method this empowering, it's easy to see why U.S. consumers have spent more than $50 billion with PayPal Credit since 2008.5
The contents of this article are provided for informational purposes only and are solely the opinion PayPal Credit. The information in this article does not constitute legal, financial, business or investment advice of any kind and is not a substitute for any professional advice. You should always obtain independent, professional accounting, financial, and legal advice before making any business decision.
1. Federal Reserve. Report on the Economic Well-Being of U.S. Households in 2017. May 2018.
2. PayPal Credit is subject to consumer credit approval.
3. Based on PayPal's analysis of internal data for 2018.
4. Based on PayPal's analysis of internal data for AutoAnything from February 2018-January 2019.
5. PayPal. PayPal Credit Transaction Volume Reaches $50 Billion Milestone. February 4, 2019.