- [00:00] - Intro
- [00:45] - What’s new with Shopify and Affirm?
- [01:31] - Buy now pay later option in your shop
- [02:44] - Price psychology
- [04:45] - How split payment works
- [05:36] - Bigger demand for installment payments
- [07:35] - More about Google, Shopify, and Affirm
- [08:53] - Where to find Tony
- [09:13] - Sponsor: Rewind
- Tony Zara LinkedIn: https://www.linkedin.com/in/tony-zara
- Tony Zara Email: email@example.com
- Iron Pulley website: https://www.ironpulley.com/
- Iron Pulley is about marketing automation. They help Ecommerce companies automate large catalogs and turn them into beautiful ads.
- Iron Pulley is excited about Shopify integration with Affirm and the buy now pay later is gonna be a game-changer for businesses.
- Shopify installments have a flexible payment which allows users to pay over time while your business gets paid up-front.
- Affirm is a tailored pay-over-time solution to help your business grow.
- Before the integration with Google, adding a split pay option or buy now pay later option was one of the easier ways to increase conversion rate.
- Iron Pulley has developed a solution to put the sophistication of that conversion motivator right into the ads.
- Affirm is going to be integrated with Shopify sometime before November. It’s easy to integrate and most likely at no cost to the business.
- This means you can lower your price without lowering your profit and you can choose how many payments that you offer.
- For instance, you can set it to six weeks, or you can set it to three years and there's a number of different options for making payments for customers.
- Retargeting using installment payment prices gives more accessibility to customers and also changes how people consider the products.
- Price is a huge motivator. People take the price and make subconscious comparisons.
- With installment, it changes how you think about prices. Consumers don't compare the product to their whole price and instead compare it to smaller prices.
- When Iron Pulley does retargeting using installment or buy now pay later prices, they found that the adoption rate doesn't change much but the conversion rate has a significant change because of how it makes people think about that purchase.
- When you have a split paid product, the risk is not on you. It's now on the financing solution.
- They're going to take a bit of a percentage for taking that risk in paying you upfront for the full cost of that good.
- For example, you won't be stuck in a situation where you sell a 100 dollar for 25. Instead, you're going to sell it for 90 and the financing solution will collect the rest of it.
- There's a bigger demand for installment payments because people want to save cash and not everyone's secure with their job.
- As the demand for installment goes up, approval goes down. Some companies are becoming more strict on who they approve and the approval takes place in the background.
- Companies do a soft credit check which doesn't show up on anybody's credit report and in the cart. They do this to show what payment options would be suitable for an individual.
- Most of the time, it's the retailer that takes the margin and not the installment payment companies.
- With some companies, you have the option of making a profit on offering financing.
- If you set up Affirm right now through your checkout process and you want to make a little bit of a profit on offering that margin, you can do that or offer those installment payments.
- Iron Pulley can display the payment price by working with Affirm. They connect their API to get the installment prices or the lowest payment process.
- Afterward, Iron Pulley does a dynamic remarketing with the lowest payment prices through, through your own Google Adwords and Google Ads account.
- People get retargeting ads that show the product with the Affirm price.
- Iron Pulley does the same thing with Facebook by taking the price and displaying it in retargeting ads.
All right, everybody. Welcome back to another episode of Unprepared. Today, I'm welcoming to the show yet another Columbus, Ohioan. Tony from Iron Pulley. How are you doing today?
I'm doing awesome, Chase. Thank you. Great to be here.
Alrighty. So just real quickly, what is Iron Pulley good at? And then let's just dive in deep with the awesomeness that just came out with these four pay with Shopify?
Sure. So Iron Pulley is about marketing automation. We typically work with Ecommerce companies to help them automate large catalogs and turn them into beautiful ads. And we're extremely excited about the Shopify integration with Affirm, the buy now pay later. It's really going to be a game-changer for everyone.
Awesome. So for buy now pay later, it's been around for a while. You've seen it through PayPal, you've seen it through Affirm, there's Klarna, there is Sazzle - there's like a lot of products out there in the ecosystem that have been available. And just before this integration with Google, adding a split pay option or buy now pay later option was one of the easier ways to increase your conversion rate.
Honestly, it just wasn't a trust signal. And you know, college kids are poor, and they want to buy stuff.
So it was, that was an easy win. But now you guys have developed a solution to put that sophistication in that conversion motivator right into the ads?
So yeah, so just to back up a little bit about all of that. There are a ton of different platforms that have come out. And what's happening with Affirm is they're going to integrate just like you have Shopify Payments brought to you by Stripe, it's going to be Shopify payments brought to you by Affirm.
And sometime before November, sometime before Black Friday, it's going to be just exceptionally easy to integrate, buy now pay later into your website, probably at no cost to you.
So what you had is the ability to lower your price without lowering your profit. And oftentimes you're going to be able to choose how many payments that you offer. You can do this within so you can set it to six weeks, or you can set it to three years. And you can, there's a number of different options for making payments for customers.
So you have that ability to make things more accessible for college kids that have no money. But more importantly, and what we're finding in doing retargeting using installment payment prices, is we're finding that it changes how people consider products.
So there's a psychology to price. And there's a ton of work that's been done on price psychology. You can go to the Harvard Business Review and read things from back 20 years ago, or you can read about case studies from recently. But price is a huge motivator in it. The way the brain works, the way we consider things, we take that price, and we make subconscious comparisons.
So for example, say I want to buy a home gym, and the home gym setup is $1,000 or less me at simply $1200 for my home gym setup. And look at that home gym setup. As I said, now that's just too much money.
But if I go back, and I think about it as 12 payments of 120, that changes how I think about it. Now I start to compare it to different things. I don't compare it to 1200 dollar things anymore, I start to compare it to a gym membership, that's $120 a month.
Well, I was paying $120 a month for CrossFit. So 1200 dollars a month, or 1200 dollars total, or 120 a month for a gym of over a year. For I'm paying the same as I would have paid my CrossFit gym, it changes that comparison, it changes how you think about it mentally.
So what we're finding is when we're retargeting using installment buy now pay later prices, we're finding that the adoption rate of buy now pay later actually doesn't change that much. But the conversion rate changes a lot because it changes how people think about that purchase.
Yeah, that's definitely a true consideration with the pricing and just coming up with different offers, essentially, it's crazy to see how the conversions change and offer, one of the big pulleys that you can pull within your business. What is the offer?
That's one of the big things you can do with your marketing to really change the course of your sales. I do want to highlight something though, for those that are unaware of these options in the ecosystem. When you have a situation where you have a split paid product, let's just call it a $100 product that you're doing for payments of $25.
The risk actually is not on you. You can send that product out and you're full, you're fine. The risk is now on the product like the financing solution is now taking all of that risk. They're obviously going to take a bit of a percentage for taking that risk and paying you upfront for the full cost of that good, whatever you're selling it for.
But you're not going to be stuck in a situation where you sell a $100 product for $25. That's not what's going to happen, you're going to sell it for probably $90. And they're going to assume the risk to collect the rest of it because that's their business model. So just to let people know how these things work a bit more true.
And right now there's a bigger appetite for that because of just uncertainty. Everybody's uncertain about what's going on right now. So people want to conserve cash and not everybody feels super secure in their job. So it becomes a calculation where people decide that installment payments are better for them.
So there are two sides to that, again, as the demand for installment payments go up, approval actually goes down. So there are more there. Some of this, these companies are becoming more strict in who they approve and that approval just sort of takes place in the background.
Where these people get an offer right in the cart, if they're approved, it's basically a silent check on their credit. It doesn't show up on their credit report. Soft check is what they call it, soft credit check.
It doesn't show up on anybody's credit report and they do a quick check to show that in the cart, what those payment options would be for an individual. Again, oftentimes, this is at no cost to the retailer.
Yeah, so I've seen it. Some of them were like, say you're selling a $100 product. And if you want to split it in four, they're gonna sell it for 110. You know what I mean, just take a little bit more on for the end consumer.
So in that case, most of the time, it's not the installment payment company that's taking that margin. It's actually the retailer. So with certain companies, you have the option of making a profit on offering financing.
So it depends on who you're working with. You can do this. Now with Affirm. If you set up a firm right now through your checkout process, and you want to make a little bit of a profit on offering that margin, you can do that or offer those installment payments.
So that the options are countless, endless, I don't know. There's a bunch of different options out there. And I know that we've installed three or four different solutions in this the past six months for clients depending on their use case, and then you know, just their vertical that they're in.
But let's get back to Google and Shopify integration with Affirm. Now what I've heard is you can actually display it. This isn't tricky, but it's like you can just display the payment price or explain this better than me.
That's right. So that's what we do. So we do, we just work with Affirm. We connect with our API to get those installment prices, the lowest payment price. And then we can do dynamic remarketing with that lowest payment price through Google, through your own Google AdWords, your own Google Ads account.
So what that ends up looking like is the very product that you looked at, you can get a retargeting ad that shows you that product with the Affirm price which is really cool because in...we think about retargeting, there's really two ways to think about retargeting.
One is keeping a product top of mind, and the other is giving you a reason to buy. And so this gives you a reason to buy, a reason to reconsider the product. This same thing, we do the same thing with Facebook so we can take that firm price and display it in retargeting for Facebook.
That's awesome. If they want to learn more about these awesome API integrations that you're doing in automated remarketing, where do they go? How do they reach out to you?
Awesome, thank you.
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