Klarna transfers its media operations to Havas North America, as the "Buy Now, Pay Later" service provider makes a significant business decision.
Klarna, the Swedish buy now, pay later (BNPL) company, has selected Havas Media Group North America to manage its media business in the United States. This partnership comes as Klarna continues to escalate its marketing activities in the U.S., driven by a surge in popularity and the growing acceptance of BNPL services.
Founded in 2005, Klarna has been making waves in the financial industry, especially during the pandemic. The ascent of BNPL companies like Klarna, Afterpay, and Affirm has been fueled by several key factors.
With lockdowns and social distancing, online shopping became essential, leading BNPL companies to integrate seamlessly into millions of online checkout flows as a flexible payment option. Near-zero interest rates during the pandemic created an ideal lending environment, enabling BNPL firms to scale loans cheaply without immediate profitability concerns.
Younger consumers, especially Gen Z, increasingly rejected traditional credit cards due to concerns about high interest rates, fees, and long-term debt, favoring BNPL for its transparency and perceived better financial control. Financial stress among younger users, caused by inflation, stagnant wages, resumed student loan payments, and elevated prices during and after the pandemic, made BNPL a helpful option for affording essentials and discretionary items without upfront full payment.
Significant investment and industry support, including venture capital and private equity, fueled rapid growth, with major deals like Klarna’s $639 million funding round and Block’s $29 billion Afterpay acquisition marking the space as a pandemic-era fintech breakout. Technological advances in fintech, such as innovations in digital payment processing and alternative lending platforms, made BNPL more accessible, quick, and secure, further driving adoption during the pandemic when fast, online transactions were crucial.
These combined factors created a perfect storm during the pandemic for BNPL services like Klarna to expand rapidly on a global scale. Klarna launched its consumer-facing app in the U.S. in 2019, and ID Comms managed the review process for its media business.
Greg Walsh, CEO of Havas Media Group North America, expressed his excitement about partnering with Klarna in an email to Adweek. This partnership is expected to strengthen Klarna's presence in the U.S. market and support its ongoing growth.
- Klarna's partnership with Havas Media Group North America signals a strategic move in its business, leveraging technology to bolster its marketing efforts in the United States, further cementing its position in the global finance industry.
- As the popularity of BNPL services like Klarna continues to grow, fueled by factors such as technological advancements in finance and shifting consumer preferences, the company's strategic integration of technology within its business models becomes increasingly significant, contributing to its expansion and success in the business and financial sectors.
