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Ababy takes a different approach to buy now, pay later trend

It’s tough to do business in regional Australia right?

Nonsense, says Heather Simpson, owner of baby goods retailer A Baby, which sells online and through a bricks-and-mortar store.

Simpson’s stores – both online and offline – are performing exceptionally well, despite the fact she is based in Nowra, a town located 160km from Canberra with a population of around 36,000.

One interesting component of the A Baby website is that it offers three popular forms of modern-day lay-by options, or buy now, pay later.

Internet Retailing’s founder Mark Freidin asked Simpson about the decision to take this unusual approach.

Mark Freidin: Heather, you are based in Nowra and have an incredibly successful online store providing goods for babies to soon to be mums. What is your recipe for success?

Heather Simpson: We are base in South Nowra, NSW, and have a large warehouse style baby shop providing quality products to sell to all over Australia. My recipe for success lies in hand picking the products I choose to sell, (which has taken twelve years to do!) and keep them in stock. And provide the knowledge I have gained to my customers with a backup of excellent customer service.

MF: What’s the ratio of online shoppers to store shoppers?

HS: I believe we must be at 3:1 ratio of online to in-store shoppers. So we have three online shoppers for everyone in store.

MF:  What tools do you use to market the website, and which one do you find the most effective?

HS: Having a good clean, easy-to-use website and keeping it up to date are the most important tools, closely followed by social media. That is, Facebook and Instagram. Google AdWords are also important!

MF: I notice that besides the usual credit card options at checkout you have taken the unusual step of offering lay-by through, Afterpay, and zipMoney. This is quite unusual – most retailers tend to choose just one of these options. What is the reason you have elected to offer all these choices? Doesn’t it confuse the customer?

HS: More choices, more sales! zipMoney and Afterpay are great but not for everybody since their criteria to gain an account can be more difficult and there are fees for late payment. Customers usually have six months to shop for their baby. Some may want their products straight away, however, others prefer for it to arrive closer to their due date but still know it is ordered. This also gives us time to order in goods that may be out of stock or special order items such as furniture. offer a payment plan through a trusted PayPal portal that most customers are familiar with and already have an account with. Customers are probably more confused with Afterpay and zipMoney, as they are reasonably new to the market. However, all Australians know what a lay-by is.

MF: Which one do you prefer, and which one is used the most at checkout?

HS: I  prefer, as it gives us time to order in goods’, however, all three are growing in popularity and each works a bit differently.

MF: As an independent retailer in regional Australia, how do you think Amazon will affect your sales. And if so, what strategies do you have in place to take on the might of Amazon?

HS: Most of our fast-selling items are quite large and you require a physical shop to gain an account with most of the suppliers. However, I would be foolish to believe that my business won’t be affected. I believe a keeping a keen eye on my competitor’s prices, including Amazon, would be my strategy.

MF: Each form of payment is quite different and it makes sense that Ababy has chosen to offer all three. The challenge for retailers is in educating shoppers about the differences. Here’s a summary of each payment method:

  • zipMoney provides a line of credit to shoppers with no interest and is the parent of popular online credit facility zipPay. zipMoney is for merchants that sell higher ticket items in the hundreds to thousands of dollars, and need up to 6 months to pay this off.
  • zipPay, on the other hand, issues a $1,000 digital wallet to consumers that lets them pay back on their own terms weekly, fortnightly, or monthly over a 60 day per period. There is no interest ever on the product and the consumer is given a monthly statement on all their purchases. A $5 fee is added to the consumer account if the consumer pushes their repayment to the following month.
  • is the online version of lay-by, which lets shoppers pay an affordable amount over a period of time to a retailer, and collect their purchase once it has been fully paid. This is a preferred option for many since there is no debt after purchase.
  • Afterpay is a mechanism that effectively extends the credit on an existing credit or debit card through instalment payments, which occur over four set fortnightly repayments.  Each purchase sets up a new repayment plan. If shoppers go over the limit of their credit or debit card, they get hit by a $17 late fee from Afterpay.
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