Klarna continues to move beyond a buy now pay later service with a suite of new feature launches in 2023

Klarna continues to move beyond a buy now pay later service with a suite of new feature launches in 2023

Klarna continues to move beyond a buy now pay later service with a suite of new feature launches in 2023

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For some time now, Klarna has been seen positioning itself more than just being a buy now pay later service. It aims to become the one-stop solution for all online shopping needs of consumers. Furthermore, it is also positioning itself as a retail bank. The shift in strategy comes amid the growing competition in the global buy now pay later segment. In 2022, Klarna launched a bunch of new services and features as part of its strategy to move beyond just being a BNPL product. The trend has further continued in 2023, as Klarna launched various new features including an AI-powered shopping feed and ads manager for retailers to connect with high-intent shopper audiences, among others.

  • The AI-powered shopping feed, launched in April 2023, gives consumers personalized product recommendations to assist them in finding the most relevant items and products. The discovery shopping feed is powered by an in-house developed AI product recommendation engine that updates the user feed in real-time. The feed becomes more and more personalized as it learns about the consumers and their shopping behavior.

Klarna has also entered into a collaboration with OpenAI. The partnership with the developer of ChatGPT aims to deliver personalized recommendations to consumers who ask the chatbot for shopping advice and inspiration. Klarna also launched an Ask Klarna feature that provides shoppers with on-demand access to shopping experts through video call or chat functionality.

With the launch of Ask Klarna, the firm looks to empower consumers to make informed decisions. The feature has been developed after the firm found out that 85% of the consumers in the United States would like a service where they can ask experts to get more information about the products. In another survey, Klarna has revealed that more than a third of the consumers are more likely to resell items going forward. As a result of this, the firm also launched a smooth resell experience for its users.

The resell feature enables consumers to effortlessly list their products on secondhand marketplaces. Klarna, for instance, will pre-fill product details and images on such marketplaces. Currently, the firm had made the feature available in Sweden in partnership with Tradera, one of the leading reselling platforms in the Nordic region. Going forward, the firm is expected to launch the service in more countries with more partners.

As part of its strategy to drive the growth of its creator network, Klarna also enabled a new feature – Creator Shops - allowing them to launch storefronts on Klarna.com. The launch of the new feature comes at the back of the recently launched Creator Platform that provides creators with the ability to recommend items and market their shop across different social media platforms. The ability to embed links into the products also enables the creators to earn increasing revenue from their posts on social media platforms.

On the other side of its business model, Klarna has launched an Ads Manager feature making it easier for retailers to reach out to potential customers worldwide.

  • Through Ads Manager, retailers can gain access to the first-party data offered by Klarna to develop more relevant shopping experiences for consumers. Furthermore, the feature will enable merchants and marketers to advertise in a more efficient way. The platform can also be used for ad creation, audience targeting, and in-platform reporting for campaign optimization.

In 2022, more and more retailers and marketers choose to collaborate with Klarna for such services. This resulted in a higher marketing revenue for Klarna, which was up 131% in 2022 compared to the year before. The addition of the Ads Manager feature is, therefore, expected to drive revenue growth for Klarna in 2023. Furthermore, the Ads Manager feature means that the firm is well-placed to become one of the leading players in the retail media network segment from the short to medium-term perspective.

These tools have been integrated into the core offerings of Klarna and are meant to deliver a richer shopping experience for consumers. This coupled, with the enhanced advertising and selling capabilities for retailers and creators, again shows that Klarna is no longer just a buy now pay later service. The firm is aiming to build a one-stop solution for everything related to online shopping. With over 150 million consumers and 500,000 retailers, Klarna has all the ingredients to achieve accelerated growth over the next five years.

To know more and gain a deeper understanding of the BNPL market in Sweden, click here.

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