Sleepenvie on Why BNPL’s Future Rests With Older Customers

Splitit - Buy Now Pay Later - June/July 2022 - A new look at why older generations are the fastest-growing BNPL user group

BNPL’s popularity is growing among older, more economically secure demographics. In this month’s “Buy Now, Pay Later Tracker,” PYMNTS talked with Joy Elena, founder of online mattress retailer Sleepenvie, who explains why older consumers are drawn to the convenience of breaking up large payments online rather than going through other credit options.

Splitit - Buy Now Pay Later - June/July 2022 - A new look at why older generations are the fastest-growing BNPL user group

Buy now, pay later (BNPL) has blazed through the payments space in just the past couple of years, rising from a little-known novelty to a widely used service among all types of consumers. A recent study found that 60% of Americans had leveraged BNPL at some point, with 46% currently in the process of making payments through a BNPL service.

BNPL has traditionally been the domain of younger generations with limited spending power, who typically use these services to punch above their weight when making expensive purchases. BNPL’s popularity has recently begun to grow among older, more economically secure demographics, who use it not out of necessity, but because of the added convenience it offers.

“It’s like the new credit card, but it’s obviously better because you’re not paying interest,” according to Joy Elena, founder of online mattress retailer Sleepenvie. “And when you see the smaller payments, it psychologically makes purchases more enticing, which may actually lead you to buy more.”

Elena recently offered PYMNTS an inside look at Sleepenvie’s use of BNPL and why she believes older generations are the future of the service.

Primary BNPL Demographics

Sleepenvie has found that its largest BNPL-using segment consists of younger individuals who are moving into new apartments and need mattresses and other sleep essentials. BNPL is a natural fit for purchasing these mandatory items that nonetheless command a high price.

“Our demographic is a younger demographic, many of whom are just starting out,” Elena explained. “Not a lot of people have $1,000 lying around, or even more than that because you’re [often] buying other things and not just the mattress. [BNPL] allows the consumer to have more buying power.”

BNPL has proved to be incredibly well-received — not just by customers, but also by the business. A large number of patrons leverage this option, Elena said, and ticket prices have gone up significantly.

“I would say it’s about a 20% increase in sales since we started, and I would say it’s about one in five [customers] who use the option,” she said.

The next step for Sleepenvie is expanding BNPL usage to demographics that traditionally have not used it before. In particular, the company has its eye on older generations with larger spending power.

Expanding BNPL Usage to New Customers

While younger customers with lower incomes currently comprise Sleepenvie’s largest BNPL user base, the company is looking to encourage its usage among older, more affluent demographics. The primary draw for these consumers is not necessarily the better affordability of big-ticket items such as mattresses, but rather the added convenience of breaking up large payments online instead of going through traditional financing options.

“The whole point of being online is to make it as easy for the customer as possible,” said Elena. “If you’re online [buying a mattress] you can’t touch or feel, you want everything to go smoothly. You want it to be easy. So if an older person sees that they don’t have to pay it all in one shot, I think that would be very enticing to them as well.”

BNPL is a logical choice for these nontraditional users, given that convenience is the primary attraction of eCommerce to begin with. These solutions interface through normal payment card portals rather than going through an additional financing application step.

“From our customers’ point of view, I hope it gets easier to go through the buying journey when you’re on the website,” said Elena. “I hope that [BNPL] makes it easier for them to get approved for financing.”

Sleepenvie is one of many retailers hoping to expand their BNPL reach to new demographics. This growth into new markets will be essential for keeping BNPL in the mainstream and ensuring its successful future.