Afterpay is a payment method that has been increasing in popularity in recent years. It’s an Australian service that, apart from Australia, is available in the UK, New Zealand, Canada and the United States.
Afterpay allows customers to make purchases when they want them but delay payments by making them in installments, without interest, over time. Afterpay is available at many different retailers, both online and in physical stores.
The Afterpay target market is broad. Afterpay is popular with millennials and Gen Zers, but it’s also used by people of all ages. Afterpay is a convenient payment method for people who want to buy items but don’t have the cash on hand to pay for them all at once. It allows people to spread the costs of a purchase over a longer period making them more affordable.
Let’s now take a closer look at the Afterpay target market by analyzing the different reasons why someone might use Afterpay.
Who is the Afterpay Target Market? And why do they use it?
One of the best ways to understand the Afterpay target market is to understand why people use it. Analyzing the need to use a “buy now pay later” service and the motivation to specifically select Afterpay gives us great insights into this market. It allows us to divide the market into individual segments and study each segment on its own.
Such a needs-based segmentation process gives us the following segments of the Afterpay target market:
- People who like to buy things they cannot immediately afford
- People who like to spread the cost of a large purchase over time
- People who do not have the cash on hand to make a purchase they need right now
- People who do not use credit cards
- People who want to avoid interest and fees associated with credit cards
Let’s now take a closer look at each of the Afterpay customer segments.
#1. People who like to buy things they cannot immediately afford
So many of us are guilty of this. We see something we want, and we want it now. Afterpay lets us have our cake and eat it too. People can use Afterpay to buy the item now and pay for it later.
Impulse buying is a real thing, and Afterpay makes it easier than ever to do. This can be a good or a bad thing, depending on how you look at it.
On the one hand, it’s great to have a payment method that lets you buy things when you want them. On the other hand, it can be dangerous to make impulse purchases that you may not be able to afford later on.
Either way people looking to make impulse purchases without having the money to do so are a segment of the Afterpay target market.
#2. People who like to spread the cost of a large purchase over time
Even when people can afford to make a purchase outright, sometimes they may not want to. Afterpay gives us the option to spread the cost of a large purchase over time. This can make a big purchase more affordable and easier to budget for.
For example, let’s say you want to buy a new TV. The TV you want costs $1,000. You could pay for it all at once with cash, but you may not have $1,000 just sitting around. Afterpay lets you spread the cost of the TV over four equal installments, payable over eight weeks. This means you would only need to come up with $250 at the time of purchase.
#3. People who do not have the cash on hand to make a purchase they need right now
Sometimes people need to make a purchase but just don’t have the cash on hand to do so. They may have enough money in the bank and they may not be interested in spreading the cost of the purchase over time. But they just don’t have the cash available right now. Afterpay can help in this situation.
For instance, they may spot an item on sale or they may need to make an emergency purchase. Afterpay lets them buy the item now and pay for it later. This can be a lifesaver when you need to make a purchase but don’t have the cash on hand.
#4. People who do not use credit cards
For many reasons, some people just do not use credit cards. Maybe they don’t like the idea of debt or maybe they’re trying to avoid high-interest rates and fees. Or maybe they just don’t have a credit card. Afterpay can be a good alternative in such cases.
With Afterpay, people don’t have to worry about interest or fees. They can simply make their purchase and then pay for it over time. And so people who want to avoid using credit cards are an excellent segment of the Afterpay target market.
#5. People who want to avoid interest and fees associated with credit cards
This segment of the Afterpay target market has credit cards and uses them for some purchases but wants to avoid the interest and fees associated with them. Afterpay can help people in this situation as well.
Not all credit cards have low-interest rates and not all of them have great rewards programs. So people may only want to use their credit cards for certain purchases. Afterpay can be a great payment method for other purchases.
This way, people can avoid paying interest and fees on their credit cards, and they can still take advantage of Afterpay’s convenient payment terms.
The Afterpay target market basically includes people who for various reasons want to make a purchase right now but not make the full payment.
This could include people who like to buy things they cannot immediately afford. It includes those who like to spread the cost of a large purchase over time.
People who do not have the cash on hand to make a purchase they need right now are also an Afterpay target market as are those who do not use credit cards.
Finally, people who do use credit cards but do not like the fees and interest associated with them are also likely to use Afterpay.