Shoppers at Simon shopping centers like King of Prussia Mall, Montgomery Mall and Philadelphia Premium Outlets will have some in-store options payment options as they do their shopping this holiday season.
Simon has entered into a multi-year relationship with global fintech firm Klarna, which offers unique in-store flexible payments and digital marketing solutions.
Under the agreement, consumers can “buy now and pay later” with participating merchants at Simon-owned shopping centers, starting Nov. 1.
Klarna’s in-store payment methods allow shoppers to pay in-store, with zero interest. The company offers a number of payment options including direct payments, pay after delivery and installment plans, including its “Pay In 4” program.
“Identifying ways that support the success of our merchants while elevating the customer shopping experience are key priorities for Simon,” David Simon, chairman, CEO and president, Simon, said in a statement. “By aligning with Klarna, we’re giving our retail tenants an important advantage this holiday season and well into the future; a unique way to attract new audiences already embracing the convenience that Klarna’s interest-free payment options provide.”
As the program gets underway, shoppers will see Klarna banners and communications across the Simon shopping centers explaining how they can use Klarna in-store. They may also get exclusive offers and discounts from participating merchants if they shop through Klarna in those physical retail locations, the company said.
In addition, merchants will benefit from a variety of digital marketing capabilities offered by Klarna that allow them to understand their customers better and enhance the shopping experience for their customers.
Participation in the new initiative is optional for merchants. Klarna, which was founded in 2005, has more than 250,000 retail partners across 17 countries. The company said it has seen “positive results” with merchants that offer Klarna in-store. One example shared by the company in an emailed response to questions was Sephora, which Klarna said has seen a 65% increase in average order value in its stores in North America with Klarna.
According to Klarna’s just released 2021 holiday report, 34% of customers surveyed said malls were the most popular place to shop this holiday season, and additionally, shoppers with the biggest budgets are twice as likely to seek out flexible payment options.
The company said that by leveraging the in-store payment solutions and digital marketing capabilities, Simon and its merchants can “drive increased foot traffic into their stores and offer more engaging experiences” for them ahead of the holiday shopping season.
“Simon connects millions of consumers with merchants in truly meaningful and engaging ways that are reimagining experiences far beyond the expected, every day,” Sebastian Siemiatkowski, CEO, Klarna, said in a statement. “With recent news reports stating that retail traffic is expected to exceed 2019 levels once again, we’re thrilled to partner with Simon to further unlock in-store revenue and loyalty for retailers, and offer customers even more ways to shop and pay how they want.”
Throughout the pandemic, online shopping increased, driving demand in alternative payment services like Klarna, the company said. While online shopping will continue to remain strong, a recent survey by Klarna of more than 40,000 consumers in the U.S. indicates that physical retail — the in-store experience — remains a “high priority for shoppers.”
The study found that brick-and-mortar stores have an instant gratification advantage over online retail, with younger consumers appreciating the speed and efficiency of in-store shopping.
Klarna’s flexible payment options will be made available to shoppers at participating merchants across all Simon properties in the U.S. including 10 Pennsylvania malls. Among the properties rolling out the initiative are: King of Prussia Mall in Upper Merion; Montgomery Mall in Montgomery Township; Philadelphia Premium Outlets in Limerick; Lehigh Valley Mall in Whitehall; Philadelphia Mills on Northeast Philadelphia and five other properties across the state.
“By aligning with Klarna, we’re giving our retail tenants an important advantage this holiday season and well into the future.” — David Simon, chairman, CEO and president, Simon
As part of the multi-year national alliance, Klarna and Simon are working on additional strategic initiatives, which will be announced and rolled out in the future.
Among Klarna’s retail partners are: H&M, IKEA, Expedia Group, Samsung, ASOS, Peloton, Abercrombie & Fitch, Nike and AliExpress. The company has 90 million active customers — 15 million in the U.S. — and processes 2 million transactions each day, according to the company’s website.
Simon is a real estate investment trust that owns shopping, dining, entertainment and mixed-use destinations, as well as S&P 100 company Simon Property Group. The trust has properties across North America, Europe and Asia.