Buy Now Pay Later (BNPL) has shaken up the market and by all accounts, it’s here to stay. Evidence suggests that although BNPL began as a Millennial and Gen Z proposition, with around one in two consumers aged under 45 now using at least one BNPL service,1 the value of this payment option continues to grow and appeal a much broader age group.
Indeed, BNPL appears to be replacing credit cards – according to research from Openpay, 81% of customers feel that BNPL is more accessible than credit cards,2 and 33% of younger adults, (aged 18–30) wish they’d never had a credit card in the first place.3
As consumers increasingly embrace BNPL, it stands to reason that so too must optometry practices. We spoke to optometrists who are now accepting BNPL to find out about the difference it is making to both the services they provide and the revenue they generate.
BNPL is delivering returns all round, with more patients able to access eye health services and higher quality products, which in turn is generating greater revenue for practices.
Andrew Bowden, from Envision Optical in Tweed Heads in New South Wales and Burleigh Waters in Queensland, said BNPL has been particularly worthwhile for patients who require courses of treatment.
“We have sub specialities in dry eyes, orthokeratology, myopia control and behavioural vision therapy. Many of our patients now use BNPL to cover the costs of these services, as well as to buy high-end spectacles. Because these treatments range from AU$600-$2500, BNPL is perfect – it lets approved customers spread out the costs.”
His practice manager, Melissa Mudge added, “It’s mostly patients aged in their 20s to 30s using BNPL in our practice. They are very excited to hear we have BNPL; they are familiar with it and already understand how it works. It’s very easy for staff and patients to use.”
Jessica Chi, the practice owner of Eyetech in Carlton, Melbourne, says from a business perspective, an important advantage of BNPL is that payment for products and services comes in straight away. “The patient may be paying for more expensive treatments like orthokeratology or mini-sclerals over time using BNPL, but we receive the payment up front, which is excellent for our cash flow. Prescribing these lenses can take months until a final prescription is achieved, and patients often can become lost to follow-up before the final resolution and final payment has been made, which makes for an awkward situation when the patient returns months later. Having BNPL paying up front and the patient being able to budget their finances, reduces the risk for us and eases the financial burden for the patient. It’s a win-win for everyone.”
Ms Chi continued, “BNPL can significantly increase the value of the optical products purchased – patients may fall in love with a particular model, however it may be outside of their budget. Having the ability to space the repayments makes the unaffordable affordable. This is particularly noted in the younger generation who have really embraced BNPL schemes.”
About LatitudePay
By partnering with MyHealth1st, Latitude says its aim is to make optometry patients aware that buy now, pay later is available through LatitudePay as a payment option prior to their appointment. With a high spending, high quality customer base, Latitude enables practices to access a whole new customer demographic, expand their customer base and grow their practices.
LatitudePay offers a simple and flexible payment method, and has been designed to provide the best possible customer experience. Offering interest free plans up to $1,000 over 10 weeks, and up to $10,000 over six to 24 months, LatitudePay enables patients to access the most appropriate services and products to help them live their best lives. As part of their commitment to responsible lending, LatitudePay completes identity checks and credit assessments on every application, and is also designed to help patients manage their financial well-being.
By selecting LatitudePay as your preferred BNPL in the MyHealth1st system, you will become part of a select group of practices in the Latitude community. You will also turn on a set of key additional features in the MyHealth1st platform that ensures your practice team are always notified of any online appointments where a patient has indicated they may want to use LatitudePay at their upcoming consult. This will help your team better serve your patients.
While BNPL providers charge merchants a fee based on the percentage of each sale, Ms Chi says this equates to only slightly more than the fees charged by traditional credit card providers.
“If we talk about the reduction in risk, the increased cash flow and the increase in average sale price, the cost of not having BNPL would be far greater,” she said.
Margarida Faustino, a business coach for ProVision’s practices in Western Australia, says, when Openpay was piloted by the group’s optometrists in 2018, the response was overwhelmingly positive.
“There was an immediate uptake by members across Australia. Very quickly it became clear that by offering greater choice and payment flexibility, patients were less likely to ‘compromise’ on the best solutions for their eye health needs. It reduced any potential financial barriers or objections.”
Concurring with Ms Chi she said, “There is undoubtedly a higher average transaction value with BNPL purchases and certainly this would have a flow on effect to multiple pair transactions, as patients no longer need to compromise or choose between option A or B due to affordability.”
Ms Faustino said ProVision encourages all members to consider a BNPL solution.
“We provide our members with information and options to not only grow their business, but to enhance the patient experience… We expect that a portion of around 122 ProVision practices who signed up to Openpay, do indeed offer multiple BNPL options to their patients and customers, based on personal choice and flexibility.”
Mr Bowden noted that consumers are brand sensitive when it comes to BNPL. “We used a smaller provider for a couple of years but we’d noticed some reluctance on the part of consumers to deviate from more established BNPL brands. We switched to a major provider when they broadened their offering in the health space because they offered the larger amounts and longer repayment times our patients needed, particularly with our specialty care parts of the practice,” he said.
About Openpay
Openpay has been helping thousands of people spread their healthcare costs over the past six years. From dentists, to optometrists, audiologists, hospitals, and specialists, Openpay offers patients a flexible payment option for the health treatment they need, when they need it. To date this company has enabled over 40,000 people to spread the cost of their health bill. Why? Because it believes patients shouldn’t need to choose between their physical and financial health.
Openpay is the first BNPL provider to partner with MyHealth1st to deliver better outcomes for practices and patients. When practices integrate MyHealth1st with Openpay, they benefit from the opportunity to increase average transaction value and new patient bookings. Your practice will be able to access specific features that will improve efficiency and allow your patients to choose the way they want to pay.
PROMOTE BNPL AT TIME OF BOOKING
The prospect of being sold high cost spectacles or an eye health service can be daunting and even cause individuals to defer making an appointment in the first place.
However, communicating flexible payment options early in the patient booking journey helps solve this problem for patients who need care, in turn providing practices with greater access to patients.
Figure 1. Consumer preferences for credit arrangements are changing.
This was the thought that Klaus Bartosch, CEO of MyHealth1st, had in mind when he reached out to BNPL providers to partner with his company. MyHealth1st is a digital platform that enables patients to book an appointment with an optometrist online. The platform also provides the patient with information that will best prepare them for their appointment – notification of BNPL availability being one key piece of advice.
“We partnered with BNPL providers to ensure that at the time a patient makes an online appointment with a practice, they’re advised of all the BNPL options available to them. Not only that, they’re asked to ‘check a box’ if they would like to pay for their purchase with BNPL and, if they’re not already signed up to a provider, they can do so on the spot,” said Mr Bartosch.
“This preference is automatically placed in Optomate or Sunix, which means when the customer is at the point of purchase, the optical assistant is prompted to ask whether they would like to make their purchase using their selected BNPL.
“Then, because the BNPL provider is integrated with Optomate or Sunix, administering the purchase in this way is extremely simple,” he added.
From the patients’ perspective he said, “Armed with knowledge that the practice will accept their BNPL payment means when they arrive at the appointment they are solely focussed on getting everything they need to optimise their vision and eye health. They’re not worried about whether or not they can afford to make the required payment on the spot – they know they’ll be able to spread it out in manageable instalments.”
MORE THAN ONE PROVIDER IS BEST
With credit cards and health insurance decreasing in popularity among younger generations, BNPL provides a method of transacting that means you won’t miss out on this patient-group’s business.
Mr Bartosch says the trick is to offer multiple BNPL options – just as you have done for credit cards.
“Back in the 70s, retailers and service providers started out by accepting Mastercard because that was the first credit card to the market. If a customer came in who had American Express or Diners – and they didn’t have cash – the customer missed out on the purchase and the retailer/ service provider missed the sale. Pretty soon commercial operators realised this wasn’t sustainable. Yes, by accepting multiple credit cards they would have to pay transaction fees to multiple card issuers, but at least they’d get the sale, the profits from which would outstrip the cost of transacting by far. “
The same applies to BNPL – if you don’t accept the BNPL company your patient has an arrangement with, you’re likely to lose their business. They will go elsewhere for a course of IPL, or orthokeratology treatment, or eyewear – and elsewhere is where they will build their loyalty.”
Indeed, research indicates that 39% of consumers prefer using BNPL for healthcare costs4 and 32% of customers would consider switching health providers for access to flexible, digital payment plans.5
This is something both Mr Bowden and Ms Chi said they have firmly in mind. While both currently accept just one BNPL provider, they said they would accept more should the market demand it.
“Presently we are only using one BNPL provider, and for as long as this form of payment remains a small proportion of our transactions, having the sole option for this practice seems adequate. If and when BNPL becomes more commonplace, and if we find we have people who are devoted to one BNPL provider, then we will consider putting more in,” said Ms Chi.
About MyHealth1st
- Improve continuity of care,
- Analyse and improve practice efficiencies,
- Double your website traffic, and double your advance bookings,
- Connect, manage and engage with your patients,
- Customise pre-screening questions for all bookings,
- Minimise appointment cancellations due to email and sms reminder workflows,
- Advise of BNPL at the time of booking, not at point of sale, to increase revenue per booking while reducing patient financial anxiety, and
- Improve business resilience in an unstable marketplace.
Contact: [email protected] to schedule a call to find out how online bookings can help your practice.
A PREFERRED PROVIDER COMES WITH BENEFITS
As noted, it’s best to accept BNPL from multiple providers at point of sale, and if you use the MyHealth1st booking platform, you’d be wise to at least accept the BNPL providers that group has partnered with; ie. Latitude, Openpay and AfterPay. This is because MyHealth1st will promote these providers when people are booking an appointment (via the platform or over the phone).
Additionally, under an agreement negotiated between MyHealth1st and these providers, when you choose one of them as your practice’s preferred BNPL partner, that partner will promote your practice to its own customer base, exposing your practice to a whole raft of potential new patients/customers.
To find out more about BNPL and how it can be implemented in your practice, talk to one of the providers and to MyHealth1st.
References
- BNPL Tracker Australia – Consumer. RFi, June 2021.
- Demystifying Buy Now, Pay Later. Honeycomb AFIA, 2021.
- How They’ll Spend It. Openpay, September 2020.
- Supergrowth, Openpay Brand Research, 2-5th October 2020.
- Healthcare Payment Experience Report – Pymnts.com January 2021.
