How On-Demand Platforms Let Customers ‘Move Now and Pay Later’

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Some entrepreneurs have no intention of starting a company but find inspiration to take on a new venture when a challenge arises in their daily lives. Bill Catania, for instance, began Zapt after he bought a refrigerator at a big-box retail store and wanted to have it delivered to his house. He found out that it would take 10 days for delivery, “which I thought was ridiculous,” Catania told PYMNTS in an interview. He started feverishly looking for an app and found two companies that were “nowhere near where I was.” From that experience, the Zapt on-demand moving and delivery platform emerged.

The company’s technology platform connects consumers and businesses with background-checked pros to complete any number of logistical tasks. It also provides a finite price to consumers. Catania said the company has worked hard on pricing algorithms “to understand what the price will be for a move or a delivery task.” By contrast, he found that a lot of competitors give a window. One service, for instance, provides an estimate on what the cost could be. “But it could change dramatically based on the job itself,” Catania said.

Instead, his company provides an exact price the customer “can count on,” which enabled the company to move forward with a financing option with Affirm. “We know the price of the move,” Catania said, adding that it’s not going to shift arbitrarily. (If customers make a work order or change order, the company processes it as a separate event.) Through the company’s flow, customers can see the cost of the move and then validate their residences as financing is not available in a couple of states. They can then see the amount of a monthly payment.

The Financing

When consumers are approved for the installment payment option, they can choose repayment terms of three, six or 12 installments that are made monthly. The company also says customers see the repayment amount and they can view interest in dollars instead of a rate. The option comes as consumers have to face some pretty big expenses when they move. Catania pointed out that they will likely have to pay a security deposit for their new apartment if they are renting (and the company tends to service many renters).

That security deposit could come at the amount of $500, $1,000, or even $2,000. Consumers then have the first month’s rent, which could range from $500 to $4,000 at a property with which the company works. They then might be tying up thousands on the front end — not to mention the moving costs. If consumers can reduce that amount and take, say, $1,000 out of the mix, Catania says consumers might be able to, say, live in a better place. And he claimed in an announcement that price determines whether customers decide to move or not move for roughly 40 percent of his customers.

According to data cited by the company, nearly half — or 45 percent — of respondents to a survey indicated that the ability to finance a purchase would make an impact on their buying decision. And roughly three in 10 consumers — or 31 percent — would not have made a purchase without a financing option. The trend toward installment financing, the company says, is millennial-driven: It claims that only one third — or 33 percent — of people under 30 years of age have a credit card, compared to 55 percent of people ages 30 to 49.

The Differentiators

Consumers can either use a web app as a direct entry point or a phone call, as the company has live agents based in Orlando, Florida who Catania says have decades of experience in the hospitality and tourism spaces. They also have an agent version of the app and can walk the customer through the process (the same one that clients can complete themselves at, say, 3 a.m. on their own if they so choose).

At the same time, Catania’s company gives the customer multiple ways to pay — whether it’s through financing with the help of Affirm or through a credit card. If the job isn’t the same day, the company doesn’t bill the customer until the job is complete. (It does keep a card on file with a 24-hour hold before the job and the final bill comes after the task.) With the financing, however, consumers aren’t making payments for 30 days.

With the help of installment financing and an omnichannel approach to booking, on-demand moving platforms are seeking to create offerings that cater to the payment and scheduling needs of today’s modern consumer.

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