If you’ve planned a wedding or had the privilege of being a guest at one, you’re already aware of the substantial costs associated with such an event.
The cost of weddings in the U.S. has been rising, transforming them into not only celebrations of love but also potential sources of financial strain. This trend has played a part in the accumulating debt among couples, as many resort to credit to fund their ideal weddings.
The accumulation of debt comes hand in hand with the “dream wedding,” with couples today often envisioning elaborate and extravagant affairs.
In 2022, the national average wedding expenditure surpassed $30,000, as reported by The Knot.
A PYMNTS report highlights the growth of installment plans as a payment method among a range of shoppers. Regardless of their age or income, around 60% of consumers now occasionally make use of installment plans.
Read more: 45% of Consumers Used Credit Card Installment Plans In Past Year
In August, PYMNTS reported that credit card balances had surged to $1 trillion, showcasing consumers’ growing reliance on this payment method.
PYMNTS talked with Michael Hershfield, founder and CEO of Accrue, to explore how the Save Now, Buy Later (SNBL) solution, through its latest collaboration with Kleinfeld, enables brides to plan for their dream dresses without the weight of a hefty one-time expense.
“Brides can spend a significant amount of money on weddings and we believe that offering this option is essential for families and brides at this stage in their lives,” Hershfield said.
The underlying models of SNBL and BNPL are distinct. Hershfield pointed out that BNPL predominantly functions as a tool for optimizing the bottom of the sales funnel. Conversely, SNBL solutions like Accrue aim to operate as initiatives spanning from the upper to mid-funnel, with a primary focus on building customer loyalty. SNBP solutions encourage customers to set aside money for future purchases, especially when they expect ongoing interactions or harbor a brand connection that inspires them to make regular contributions to a dedicated savings account.
According to Hershfield, Accrue does not engage in aggressive marketing. Instead, merchants place the platform where potential users are likely to encounter it.
Regarding Kleinfeld’s integration of Accrue, it entails showcasing the service prominently on their website beyond the traditional checkout page. Through these promotions, Kleinfeld can introduce brides to SNBL. Simultaneously, this approach bolsters customer loyalty and engagement, and nurtures a positive brand image.
Hershfield said Accrue offers more than what a conventional bank does when depositing money. In fact, Accrue provides a 10% cashback reward every time customers deposit money into the platform.
“If they deposit $10, they receive an additional $1 as a reward,” Hershfield said. This reward is in addition to any incentives or bonuses offered by Kleinfeld.
Hershfield said Accrue provides features like roundup tools and the option to request contributions from friends and family.
Hershfield emphasized that Accrue does not aim to alter consumer behavior when it comes to payments. “We’re like a debit card,” he said. “The user experience is designed not to be disruptive but rather to simplify the process for brides, making it as seamless as possible for them to acquire what they desire for their big day.”
“I love the question,” Hershfield said. “We make money in three ways.”
Initially, Accrue generates income through a software-as-a-service (SaaS) fee. In certain partnership scenarios, an interchange component may also add a revenue stream. And finally, the third source of revenue comes from a performance fee, usually calculated as a percentage based on the performance outcome.
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