Consumers have even more ways to pay online for Old Navy Rockstar jeans and Gap logo sweatshirts this holiday season.
On Wednesday, Gap Inc. entered into a new partnership with payments company Afterpay, which will give online shoppers on the company’s multi-brand e-commerce platform the opportunity to pay for their purchases in four interest-free installments. The apparel giant’s online platform enables customers to shop across Old Navy, Gap, Banana Republic, Athleta, as well as Gap Factory and Banana Republic Factory, and check out, all in a single transaction.
The partnership arrives at a time when retailers brace for an unprecedented holiday season and explore new ways to help woo consumers back to their holiday shopping routine. It also caps off a transformative year for Gap Inc., which in recent months has boosted its consumer profile by inking a multi-year deal with Kanye West’s Yeezy label and an expanded loyalty program that gives shoppers access to their rewards for its four core brands both online and in-store.
Empowering consumers—be it with rewards or payment options—is part of Gap Inc.’s evolution into modern retail. “By adding Afterpay to our other payment options, we’re able to provide a more customized shopping experience, give our customers additional convenience and control and reach a younger demographic who may not have been able to shop with us before,” said John Strain, Gap Inc. chief digital and technology officer.
The deal with Gap Inc. marks Afterpay’s largest partnership to date. During the company’s recent virtual investor day, Gap Inc. CEO Sonia Syngal said Gap’s corporate portfolio reaches roughly 80 percent of the U.S. apparel market and has 170 million known customers. With $16 billion in annual volume in 2019, she said the multi-branded firm is the “largest apparel retail company in America” and is No. 2 in the U.S. apparel market for e-commerce sales.
Gap joins a growing number of merchants that have been adopting buy now, pay later services, largely for the purpose of appealing to a younger demographic. Gen Z and Gen Y consumers are some of the top cohorts that take advantage of these services, likely due to their familiarity with technology and general aversion to credit cards and loans.
And the pandemic may have accelerated the popularity of these payment services. In March of last year, Afterpay reached its one millionth customer in the U.S. More than a year later, the company now has 6.5 million active stateside customers and works with nearly 14,000 active merchants across the nation.
Globally, Afterpay has attracted more than 11 million active customers and nearly 63,000 retailers.