Buy-Now-Pay-Later: US Industry Analysis

Goals

To provide an overview of the Buy-Now-Pay-Later market in the United States. Specifically, we will provide the
  • US market size
  • Expected annual growth
  • A competitive analysis of the Buy-Now-Pay-Later market for players such as:
    • Klarna
    • Afterpay
    • Quadpay
    • Affirm
    • Sezzle
    • and other players in the space.
  • Specifically, we will provide their:
    • Market share
    • Customer/go-to-market (GTM) strategy (who are these companies targeting)
    • Marketing spend
    • Product differentiation
    • Marketing campaigns by these companies.

Early Findings

Data Availability

  • The initial round of research indicates that data availability is adequate on this topic.

Buy-Now-Pay-Later US Market Size and Growth

Top Industry Players

Other Helpful Findings

  • According to CNBC, retailers are making it easier than ever to purchase items with “buy now, pay later” loans.
  • Also known as point-of-sale installment loans, BNPL is "a type of short-term financing that allows you to divide your purchases into monthly installments."
  • Companies that offer such services such as Affirm, Klarna, Afterpay, and Quadpay, are becoming more popular.
  • This is because consumers are looking for solutions to help them spread out the payments on large acquisitions, without using a credit card.
  • According to an Adobe analysis, the BNPL market in the U.S. grew 215% year over year in the first two months of 2021.
  • The lenders partner with retailers like Macy’s, Walmart, and Peloton to offer their services.
  • The US buy now, pay later (BNPL) market, which Affirm overwhelmingly dominated as recently as 2018, has now given way to several other providers.
  • In Q1 2021, Afterpay and Klarna made up a combined 60% of all US downloads for top BNPL apps, a major increase from their collective 19% share in Q4 2018.

Summary

  • We focused the initial research hour on providing the market size, growth rate, top players, and other helpful findings regarding the US BNPL industry.
  • The initial research hour has revealed that information relating to this topic is available in the public domain. However, additional research time is required to enable us to calculate the market shares of the identified key players and provide other necessary information, including their share of the market, customer/gtm strategy (who are these companies targeting), and product differentiation.
  • The initial hour of research also revealed that most of the companies in the BNPL space did not avail their marketing spend in the public domain except for public companies such as PayPal, with the total company marketing spend recorded in its annual report. As a result of the lack of such information in the public domain, we suggest providing an alternative data point such as an overview of each company's BNLP offerings, their user base, and the average number of monthly downloads.

  • For a deeper dive into the above-suggested research parts, we recommend further research. Details on our recommended research paths have been provided in our proposals below.

Research proposal:

Only the project owner can select the next research path.
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