Klarna announces plans to expand to the US in 2015
Klarna today announced plans to expand its services to the United States in early 2015. To drive this expansion, the Swedish ecommerce company has recruited executives from Apple, PayPal and Alliance Data. In less than ten years Klarna grew to became a well-know and very popular payment solution in Europe. Next stop: the USA.
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To be honest, this is not coming as a surprise. Back in August we published a post about how Klarna hopes to launch in America next year. But now the Swedish company made it official. It recruited Brian Billingsley from Alliance Data as CEO of North America, former PayPal director Carol Hargrave will be CMO of the North American division, while former Apple payments counsel Jin Han will be the Chief Legal Counsel for Klarna’s newest market. Earlier recruitments for this specific region include Matthew Risley and John Keatley.
Klarna doesn’t win if retailer doesn’t win
“Online retailers in the USA have grown disillusioned with existing payment solutions as the poor user experience has led to abandoned checkouts and lost sales for years. It’s common that 90 percent or more of consumers entering a mobile checkout do not complete their purchases”, said Brian Billingsley, CEO North America of Klarna. “Klarna has a very simple value proposition: We increase conversion at checkout and assume all the risk. Klarna doesn’t win if the retailer doesn’t win.”
According to Sebastian Siemiatkowski, Klarna’s CEO and co-founder, retailers in Europe who use their services have seen increased mobile conversion from a few percentages to close to fifty percent on average. “We founded Klarna with the vision to simplify buying online. By putting the consumer experience first, we can make the mobile a platform for shopping, and not just browsing.”
It's an awesome time to be part of @Klarna!
— Brian Billingsley (@BBillingsley) September 17, 2014
Klarna’s unique selling point is that they separate buying from paying. When a consumer makes an online purchase on a website offering Klarna’s service, he only needs to enter some top-of-mind information like an email address or zip code. From there, Klarna assumes all the risk from the purchase transaction, pays the retailer immediately and collects the amount due from the consumer within 14 days.
With this ‘buy now, pay later’ approach consumers can check out quickly and only have to pay for their goods when they’ve got them in their hands. In Europe more than 45,000 retailers, including international players like ASOS, Spotify and Zara, use Klarna and offer this payment option to more than 25 million users. Klarna, founded in Stockholm in 2005, expects revenue of more than 250 million euros in 2014. It’s expected to help retailers sell more than 7 billion euros worth of goods this year.
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