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Chicago Bulls Star Zach LaVine Fronts Klarna’s All-Star Activation

Klarna popped up in Cleveland for NBA All-Star Weekend and tapped Chicago Bulls star Zach LaVine for its first sports-focused activation.

Visitors to the Swedish “buy now, pay later” fintech’s Klarna All-Star Vault, open Feb. 18-20, saw Stadium Goods-curated sneakers worn in high profile-games, including the 1989 Air Jordan 4 that Chicago Bulls legend Michael Jordan worn during the infamous “Shot” against Cleveland. Shoes on display were sourced from collector Gerard Starkey’s archive and also included the 1996 Air Jordan 11 “Columbia”; Air Jordan 12 from the Bull’s 1997 title run; as well as rare originals including the 1985 Air Jordan 1 High “Banned” and the 1992 Air Jordan 7 “Bordeaux.” The curation is also viewable online at KlarnaVault.com.

Consumers also cast their vote using the Klarna app for one of two outfit options 26-year-old LaVine would eventually wear on his way to the All-Star Game, underscoring the role NBA luminaries have played in defining or cementing the fashion agenda. The shooting guard stepped out in Amiri slim-fit jeans embellished with quilted and patch detailing and a Kenzo organic cotton T-shirt, both from Farfetch. He topped the ensemble with a shearling-trimmed suede trucker jacket from Mr Porter, keying into a fall trend to watch.

Zach LaVine in front of a mural designed by Sophia Chang at the Klarna All-Star Vault activation during NBA All-Star Weekend in Cleveland.
Zach LaVine in front of a mural designed by Sophia Chang at the Klarna All-Star Vault activation during NBA All-Star Weekend in Cleveland. Kelsey Rose

Klarna put together a mini basketball court in Cleveland and called in artist Sophia Chang to design a mural and create custom merch including beanies and autographed basketballs. Online shoppers who purchased from Stadium Goods through the Klarna Vault website were entered to win sneakerhead-approved kicks including the LeBron 10 P.S. Elite “Total Crimson”, Air Jordan 3 Retro OG “Black Cement”, Air Jordan 1 Retro High OG “Banned”, and Kobe 5 Protro X Undefeated “What if” Pack.

Klarna’s installment payments options have attracted a growing number of users, especially among young consumers trying to making their income stretch. 42matters, a mobile app data insights providers, says Klarna led all pay-later providers in holiday-season downloads, with 4.5 million Android and 4.3 million iOS users adding the software to their devices between Nov. 1-Jan. 1. Afterpay trailed at a distant No. 2 with nearly 650,000 Android and just more than 1 million iOS downloads. Affirm, Zip (formerly Quadpay) and Sezzle rounded out the top five list.

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Chicago Bulls star Zach LaVine leaving for the All-Star Game in his Klarna fan-voted look
Chicago Bulls star Zach LaVine leaving for the All-Star Game in his Klarna fan-voted look. Klutch Sports Group

Sustainable brands take the Klarna spotlight

Meanwhile, it just got a little easier for shoppers to buy clothing brands classified as sustainable and better for the environment.

Klarna recently added a channel that highlights sustainable clothing brands including Patagonia, Nudie Jeans, Mara Hoffman, Vitamin A and Lucy & Yak from Great Britain.

“Our vision is to empower consumers to vote with their wallets to enact change,” noted Salah Said, head of sustainability for Klarna, which launched in 2005. “Now we are giving consumers powerful tools to act on this knowledge and inform their shopping choices.”

According to a survey by Futerra, a British sustainable strategy and creative agency, 88 percent of consumers want brands to help them live sustainably, but it can be overwhelming to figure out which are the best sustainable labels.

Klarna showcases 23 clothing brands receiving top scores from Good On You, a sustainability rating platform for fashion brands. Good On You partnered with Klarna to launch the first set of sustainable brands to be featured on the app.

Many of the labels on Klarna are based in Europe, with 17 percent of them being U.S. based, but all are available to purchase until the end of April in the United States, Germany and Sweden. New sets of sustainable collections will be highlighted throughout the year and extended to more countries.

“Step by step, we aim to provide consumers with more information on sustainability metrics on the brand and product level,” Said added.

To keep track of environmentally sustainable brands, Klarna last year launched its carbon emissions tracker to provide an average kgCO2 value for each purchase. Klarna plans to expand the tracker to include CO2 emissions at the product level, enabling like-for-like comparisons on specific items.

Klarna was introduced to U.S. customers in 2015 and employs a “buy now, pay later” program where shoppers can purchase goods through various plans, including an option to make four payments every two weeks without incurring interest. But late fees can apply if payments are missed.

The Swedish company now has 24 million U.S. consumers out of 90 million worldwide, the company said. Klarna is one of several “buy now, pay later” or BNPL companies that have become popular alternatives to credit cards. In some ways, it is similar to the layaway plans promoted by department stores after the Great Depression and popular until the 1980s when credit cards were easier to acquire.

But the popular BNPL payment trend and the companies that promote them are being scrutinized by federal regulators concerned at how quickly shoppers can accumulate debt and how these companies are collecting data about their customers.

Klarna, the buy now pay later app, partnered with Good On You to find 23 sustainable brands that consumers would like to buy.
Klarna is bringing sustainable brands to its app. Klarna

A closer look

On Dec. 16, the Consumer Financial Protection Bureau(CFPB) issued a series of orders to collect information on the risks and benefits of the fast-growing loans and services at Affirm, Afterpay, Klarna, PayPal and Zip, five of the most popular pay-later players. Responses are due by March 1.

The CFPB is asking companies to hand over transaction usage metrics and use cases, user and merchant fees, user demographics, gross merchandise value, and loan performance metrics related to servicing, credit reporting, returns and refunds, delinquencies, defaults, debt collection and charge-offs.

The bureau also is seeking information about the data companies collect and retain as a result of BNPL product usage, as well as clarification on how they monetize BNPL product data.

Each of the five major BNPL providers has different features—for example, Affirm still charges interest rates for some plans, while Klarna and Afterpay collect late fees.

Lenders have often touted BNPL as a “safer” alternative to credit card debt, along with its ability to serve consumers with scant or subprime credit histories.

But according to an August 2021 Credit Karma study of some 1,000 U.S. consumers, 34 percent of those who have used BNPL services have fallen behind on one or more payments.

Of those who admitted to having missed at least one payment, 72 percent said they believe their credit score declined as a result of missing one or more payments, with 31 percent of those saying their credit score declined significantly.