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How M.Gemi & Ministry of Supply are Using Flexible Payments to Drive Engagement

If you think Facebook’s feed has become cluttered with DTC ads, one can only image the glut the average consumer faces in their inbox each day.

But M.Gemi found a way to break through the noise by augmenting its communications with SMS.

The switch to the more immediate call to action is just one way the DTC Italian footwear brand has adapted its practices to suit customer needs, according to Heather Kaminetsky, chief brand officer, M.Gemi. And it’s paying off.

“They not only enjoy it better, they [also] find that the messages are crisper and clearer, and that’s how we’re communicating with our consumers,” Kaminetsky said. “While engagement is shifting a little bit, the SMS channel has helped us create incremental revenue.”

Figuring out how to listen, and react, to consumer demands has been a key differentiator for the company.

“A lot of the reason [our consumers] love M.Gemi is they love the ease of shopping with us,” Kaminetsky said in Sourcing Journal’s recent “Why DTCs are a Shopper Magnet” webinar. “The consumer has taught us a lot about not only what they want on the merchandising side, but how they want to shop for it.”

Keeping pace with consumer trends is also what led the brand to adopt flexible payment options. By allowing shoppers to try items before they buy, M.Gemi removed some of the uncertainty that can arise from shopping online for items like shoes where fit can be an issue. The deferred payment option, powered by Klarna, not only boosted conversion rates but also increased repeat rates.

For Ministry of Supply, the DTC apparel brand has found that offering flexible payments removes the barrier of purchase that accompanies traditional online selling, which is especially important for smaller brands establishing new consumer connections.

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Rather than asking new customers to take a leap of faith by purchasing something and then deciding if they like it, offering deferred payments “really changes it back to a narrative that people are a lot more comfortable with,” said Ministry of Supply co-founder and president Aman Advani.

“Switching those two moments—I like it, then I buy it, instead of I buy it, then I like it—removes a massive amount of friction in our company or any one like it,” he said.

Both M.Gemi and Ministry of Supply offer Klarna’s Installment option to consumers, which enables the customers to spread their payments across four installments. What’s interesting, said Hannah Bravo, Klarna commercial director, merchant development lead, is that 86 percent of these Installment transactions are funded by consumers with debit cards. Given that two-thirds of millennials don’t have a credit card—nor do 60 percent of people older than millennials—this indicates there’s still a need for deferred payment options.

Listen to “Why DTCs are a Shopper Magnet,” hosted by Sourcing Journal and Footwear News, and sponsored by Klarna, to learn more on how these brands are adapting their paths to purchase, how they’re engaging consumers in-person and online, and how they’re identifying the tools that boost both customer acquisition and retention.