How Point-Of-Sale Financing Can Enhance Your Sales Strategy

Published: January 30, 2024, Last Updated: February 2, 2024

Writer at
Writer: Anais Osipova
Reviewer at
Reviewer: Michael Needham

A dedicated medical clinic and home improvement contracting company – both distinct, yet they share a common goal: to elevate their sales strategies. Enter point-of-sale (POS) financing. This isn’t just another trend; it’s a powerful tool that boosts sales for businesses big and small.

Sales growth strategies

Why zero in on POS financing? Implementing this financing solution has been shown to boost sales by 20% to 30%. This isn’t just about figures; it’s a reflection of how customers want to shop and spend. With POS, businesses are not just selling; they’re building relationships, understanding their customers’ needs, and offering flexibility that breeds loyalty.

Ready to explore how POS financing can transform your business and elevate your sales?

How Point-Of-Sale Financing Can Boost Sales

‘Point-of-sale financing’ isn’t just a buzzword; it’s a powerful sales accelerator. By aligning with today’s consumer expectations of flexibility and ease, it opens the door to increased sales. Next, we’ll explore how POS financing simplifies the buying process and significantly boosts business revenue.

Increases Purchasing Power

By offering more accessible and flexible payment options, POS financing breaks down financial barriers, enabling customers to make purchases that might otherwise be out of reach. POS financing doesn’t just open wallets – it increases the purchasing power of clients who value both affordability and immediacy in their shopping experience.

In essence, POS financing turns more individuals into clients, directly contributing to a surge in sales for businesses. By making it easier for customers to say ‘yes’ to purchases, companies see a tangible lift in their sales figures, illustrating the impact of POS financing options.

Boosts Conversions

Improving conversion rates is yet another key benefit of POS financing in elevating sales. Businesses implementing POS options see an average increase in conversion of up to 30%. This significant uplift can be attributed to the simplified and more accessible payment process.

When customers encounter fewer financial hurdles at checkout, the path to completing a purchase becomes smoother. POS financing addresses this by offering a more manageable payment structure, encouraging customers to finalize purchases they might otherwise hesitate to make.

The impact of this on sales is clear: more completed transactions lead to higher overall sales. By effectively reducing the friction in the purchasing process, POS financing doesn’t just attract customers – it converts their interest into tangible sales, making it an invaluable tool in the arsenal of modern businesses looking to boost sales.

Expands Client Base

With POS options, businesses tap into a wider demographic, including those who might not have the immediate funds for a full upfront payment. This inclusivity is more than just good business sense – it boosts sales, which is reflected in the numbers.

Higher customer acquisition

For instance, businesses offering POS options experience up to a 54% increase in brand exposure to new customers. This expansion is not just about reaching more people; it’s about reaching a more diverse group of consumers, each with unique purchasing habits and preferences.

The result? A more robust and diverse customer base that directly contributes to a sustained increase in sales.

Encourages Higher-Value Transactions

With the flexibility of staggered payments, customers feel more comfortable committing to larger purchases. This is because the financial burden is spread over time, making it more manageable and less intimidating than a single, large upfront payment.

As a result, customers are more likely to add extra items to their cart or opt for higher-end products, knowing that the payment can be broken down into smaller, more digestible amounts.

The rationale is simple: when the financial burden of a purchase is less intimidating, customers are more inclined to invest in quality and higher-priced items. This drives up the average transaction value and positions businesses to cater to a market segment that prioritizes value over cost.

In fact, businesses that have incorporated a POS option have seen an 87% increase in average order value. The result is a win-win: customers get the products they desire without immediate financial strain, and businesses enjoy a boost in their sales figures.

Improves Repeat Business and Customer Retention

Incorporating POS options goes beyond a one-time transaction boost for businesses – it fosters long-term customer relationships. And why does this matter when it comes to increasing sales?

Customers who find the payment process easy and accommodating are more inclined to revisit the same retailer or service provider for future purchases. POS financing contributes to this positive experience by offering a seamless and flexible payment process, which enhances customer satisfaction. In fact, 38% of merchants offering a POS option noted increased repeat purchasing from customers.

Moreover, the flexibility of POS options creates a sense of trust and goodwill between the customer and the business. By offering these options, businesses demonstrate an understanding of their customers’ financial needs and constraints, fostering a relationship that goes beyond a single transaction.

Drives More Referrals

When customers have positive experiences with flexible payment options like POS, they are more likely to recommend the business to friends and family. Satisfied customers become advocates for the business, increasing the customer base and enhancing the business’s reputation.

New customers drawn in by referrals are likely to have a similar positive experience, perpetuating the cycle of referrals and new customer acquisition. By facilitating positive customer experiences, businesses can leverage POS financing to boost sales and build a loyal community around their brand.

Provides Seamless and Convenient Payment Options

Consumers increasingly value simplicity and speed in their transactions. POS financing caters to this by minimizing the time and effort required to complete a purchase. Whether it’s a retail store or a service provider, the ability to offer fast, digital financing at the point of sale reduces friction and enhances the overall purchasing experience.

buy now, pay later on cellphone

This ease of transaction is not just a comfort – it’s a significant sales driver. A straightforward and quick checkout process reduces cart abandonment, particularly in online settings. For physical stores and service providers, it means faster service delivery and a smoother customer journey.

By removing financial and procedural obstacles, POS financing encourages more frequent purchases and larger ticket items, directly impacting sales in a positive way.

Promotes Competitive Advantage

In a marketplace crowded with options, offering flexible payment solutions like POS financing can set a business apart. This feature not only attracts customers looking for financial flexibility but also positions the business as a forward-thinking, customer-centric entity.

This competitive edge is particularly relevant in today’s economy, where consumers are more discerning about their spending choices. By providing a range of payment options, businesses cater to a broader spectrum of financial needs and preferences. This adaptability appeals to a wider customer base, including those who might prefer staggered payments over traditional lump-sum transactions.

Moreover, POS financing can be a deciding factor for customers choosing between similar products or services. A business that offers more convenient payment options can often sway customers in its favor, directly translating to increased sales.

6 Strategies for Optimizing Sales with Point-Of-Sale Financing

The benefits of point-of-sale financing are undoubtedly numerous, especially when it comes to boosting sales. But, the real power lies in effectively implementing POS financing to maximize sales potential. Here’s a roadmap for businesses to leverage these financing options to their fullest sales-boosting potential:

Offer Competitive Options

To maximize the impact of POS financing, businesses must first thoughtfully select lending partners whose offerings align with their customers’ needs. POS financing isn’t just about adding a payment option; it’s about enriching the customer experience and catering to their financial realities.

Here’s how:

  • Assess Lender Offerings: Start by exploring lenders who provide a variety of POS plans. These could include options like no-interest plans for short-term financing or extended payment terms for larger purchases. Different plans will appeal to customers with varying spending habits and financial capacities.
  • Accommodate Diverse Credit Histories: Look for lending partners that cater to a broad spectrum of credit profiles, including those with less-than-perfect credit. This inclusivity ensures that more customers can access financing, widening your potential market.
  • Offer Flexible Financing Options: Check how flexible these lenders are in terms of repayment terms and interest rates. Are there options for early repayment without penalties? Are the interest rates competitive? Can the terms be adjusted based on the customer’s needs? The more adaptable the lender, the more appealing the financing option will be to your customers.
  • Conduct Targeted Research: To align lender offerings with your customer base, engage in specific market research like customer surveys or focus groups. Ask your customers directly about their preferred financing options and understand their typical credit situations. This direct feedback can be invaluable in choosing the right lending partner.
  • Research Lender Reputation: Investigate potential lenders by looking at online reviews, checking with business bureaus, and exploring industry forums. This will give you insights into their customer service, reliability, and any compliance issues they might have faced. Websites like Trustpilot or Better Business Bureau can be great starting points for customer reviews and compliance records.
  • Implement a Pilot Program: Test the waters with a pilot program involving a select few lenders. Monitor key metrics like sales uplift and customer feedback to evaluate the effectiveness of each lender’s offerings.

Train Sales Staff

Your sales staff are the front-line heroes who turn interest into sales. That’s why equipping your team with the knowledge and skills to promote POS options can open up new avenues for boosting sales.

Staff training session about consumer financing options

Let’s explore the key strategies that will equip your team to excel in this area:

  • Engaging Training Programs: Start by developing comprehensive training programs for your sales staff. These should cover the nuts and bolts of your POS offerings, focusing on how they add value to the customer’s purchasing journey. Staff should understand the technical aspects and the practical benefits for customers.
  • Role-playing Scenarios: Incorporate role-playing exercises that simulate typical customer interactions. These scenarios can help staff practice explaining the financing options clearly, concisely, and compellingly, preparing them for real-world customer engagements.
  • Highlighting Customer Benefits: Train your staff to effectively communicate the key benefits of POS options. They should be able to articulate how these options provide
  • Creating Positive Customer Experiences: Teach your team to use POS discussions as opportunities to enhance customer service. They should be adept at answering questions, addressing concerns, and creating a positive, informative interaction that encourages customers to use these financing options.
  • Regular Updates and Refreshers: Keep your sales staff regularly updated on any changes or new features in your POS offerings. Regular refresher courses can ensure they remain knowledgeable and confident in discussing these options with customers.
  • Feedback Mechanisms: Implement feedback systems where staff can share their experiences and insights from customer interactions. This feedback can be invaluable in refining your training programs, as well as POS offerings.

Unlocking the full potential of POS financing isn’t just about offering these options; it’s about strategically promoting them to boost sales. The key is to craft offers and promotions that highlight these options as attractive solutions for customers.

Let’s explore some targeted promotions and offers that can encourage your customers to buy more and more often:

  • Create Targeted Promotions: Develop promotions that showcase special financing terms for new and loyal customers. For example, offer an interest-free period for first-time POS users or a reward system for returning customers who choose financing options. These promotions can be especially potent during high-demand seasons or for promoting new launches.
  • Strategically Showcase Products/Services: Use these financing options as a spotlight for certain products or services, particularly those with higher price tags or new offerings. By pairing special items with attractive payment terms, you transform potential financial barriers into compelling reasons to purchase.
  • Personalize Offers: Tailor your financing promotions to different customer segments. These should be tailored to catch the eye of both new and loyal customers, creating a sense of opportunity and value. Whether it’s a limited-time, no-interest option or exclusive rewards for frequent users of POS financing, each promotion should feel like a special invitation to the customer.
  • Leverage Seasonal Campaigns: Align your financing promotions with seasonal shopping trends. During holiday seasons or major sales events, offer special financing terms that make it easier for customers to make larger purchases.

Diversify Marketing Channels

Diversifying your marketing channels opens multiple avenues to promote POS financing options. Leveraging a variety of platforms offers unique opportunities to showcase these flexible payment methods, engaging customers where they are most active and receptive.

Overhead view of digital marketing meeting

Here’s how your business can utilize these channels effectively to capture a wider audience and drive sales:

  • Social Media: The key is to create interactive and informative content that resonates with your audience. For instance, on Instagram, use Stories and posts to showcase how POS options can make shopping easier and more accessible. Include real-life scenarios where these options have helped customers. On platforms like Twitter, engage in trending conversations related to shopping and financing, positioning your brand as a solution. Regularly update your followers about any new POS features or promotions. Encourage customers to share their positive experiences with your financing options, as social proof can significantly influence potential buyers.
  • Website: Your website should serve as a central hub for information on POS options. Create a dedicated section or page that explains these options in detail, including how to apply, the terms, and the benefits. Use clear, simple language and visuals to guide the user through the information. Ensure that this section is easily accessible from the homepage and product pages. Incorporating customer testimonials or a FAQ section can also help demystify POS financing for new users. Highlight these options during the checkout process with persuasive call-to-action phrases that emphasize their ease and convenience.
  • Email Marketing: Craft a series of targeted emails that educate your customers about the advantages of using POS financing. Start with an introductory email explaining this funding option, followed by more detailed emails that cover different aspects, such as ease of use, flexibility, and how it can enable larger purchases. Segment your email list to provide personalized content. For example, target high-value customers with messages about how POS financing can facilitate larger purchases. Regularly feature POS options in your newsletters and promotional emails, especially during peak shopping seasons or for special promotions.
  • In-store Signage and Displays: In physical stores, use signage to prominently advertise POS options. Place informative posters and digital screens near high-value items and the checkout area, highlighting how POS financing can make purchases more manageable. Train your staff to initiate conversations about POS options. They should be able to confidently explain the benefits and process of these options. Consider creating informational brochures or flyers that customers can take away to read at their leisure.

Analyze Customer Purchasing Behavior

Analyzing customer purchasing behavior reveals insights into how your clients interact with your POS options. By understanding these patterns, you can tailor your strategies to meet their needs more effectively, enhancing the impact of these financing options on sales.

Here’s how you can dive into customer behavior analysis to enhance your financing strategies and sales:

  • Utilize Advanced Analytics Tools: Implementing analytics tools like Practice Management Software for healthcare professionals or Project Management Software for contractors can reveal how clients engage with POS options. These tools track the frequency of services, average costs, and trends in POS financing. For instance, in medical practices, analyzing the uptake of POS options for different treatments can inform more patient-friendly payment plans. Similarly, contractors can use data on job sizes and financing preferences to offer more adaptable payment options. Such tailored approaches can enhance customer satisfaction and increase conversions in service-oriented businesses.
  • Detailed Customer Segmentation: Effective use of CRM software allows for nuanced customer segmentation. This process helps identify which customer groups are more inclined to use POS financing. Armed with this knowledge, you can create targeted marketing campaigns and adjust your POS offerings to align with the specific needs of these segments, thereby enhancing customer engagement and sales.
  • Conduct Regular Surveys and Polls: Engaging directly with your customers through surveys or polls gives you firsthand feedback on their financing preferences and experiences. Tools like SurveyMonkey or Google Forms can streamline this process. This approach provides a clear picture of customer satisfaction and areas for improvement in your POS financing options.
  • Implement A/B Testing: A/B testing different POS offers can reveal customer preferences for specific terms, promotions, and offers. By analyzing the results, you can refine your financing options to better match what drives higher transaction values and customer loyalty.

Continuously Improve and Enhance Offers

Finally, to continue the upward sales trajectory, businesses must evolve with their customers by staying in tune with their financing needs and preferences. That’s why regular updates to your POS options are necessary to drive continuous sales growth.

Here’s how you can improve and enhance your POS financing options:

  • Stay Informed About Market Trends: Regularly research market trends and consumer behavior related to POS financing. This can involve keeping an eye on industry reports, competitor strategies, and emerging technologies in the financing space. By staying informed, you can anticipate shifts in consumer expectations and adapt your offerings accordingly.
  • Gather Continuous Customer Feedback: Establish a system for continuous customer feedback on your financing options. This can be achieved through post-purchase surveys, feedback forms on your website, or direct conversations in-store. Listening to your customers provides invaluable insights into how your financing options are perceived and how they can be improved.
  • Regular Review and Adaptation of Terms: Schedule periodic reviews of financing options with lenders. This includes reassessing and negotiating more competitive interest rates, repayment periods, and eligibility criteria. Ensure these terms remain competitive and in line with what your customers find appealing and manageable.\
  • Innovate with Technology: Embrace technological advancements that can enhance the POS financing experience. This could involve integrating more user-friendly interfaces, offering mobile app-based financing options, or incorporating AI to personalize financing offers.
  • Employee Training and Feedback: Regularly train your staff on any new developments or changes in your financing options. Their direct interaction with customers can provide ground-level insights. Encourage them to share customer reactions and suggestions, which can be invaluable for continuous improvement.
  • Monitor Financial Performance: Closely monitor how changes in your POS offerings impact your financial performance. Look at metrics like sales conversion rates, average order value, and customer retention rates. These metrics will guide whether the changes you’re making are positively impacting sales.

Final Thoughts

Adopting POS financing is more than just a sales tactic – it’s a strategic approach to meet evolving consumer demands. This adaptation not only enhances the customer experience but also directly contributes to an increase in sales.

By continuously refining these payment options, your business is poised to capture a broader market, ensuring growth and customer satisfaction in an ever-changing commercial landscape.

Anais Osipova

Content ManagerAnais is the content manager at Finturf and is based in Los Angeles, CA. She has a background in finance writing and legal studies, with a curiosity for how tech solutions are revolutionizing business offerings and growth. She works hands-on with innovators in the point-of-sale and finance industries to create content that engages and informs her readers.

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