Businesses across beauty, fashion, accessories, home goods, and more to receive $4.5M in free payment and media services to aid in their post-pandemic recovery
Klarna, a leading global retail bank, payments and shopping service, announced the first group to receive grants from the recently-launched Klarna Small Business Impact Initiative to help SMBs recover from a loss of business due to the pandemic. Recipients will be awarded a portion of $4.5 million in Klarna services, including one year of fee-free payments and $40,000 of free media that extends marketing exposure across Klarna’s ecosystem.
In a recent survey of Klarna’s small business partners, 44% noted the biggest challenge their business faced as a result of COVID-19 was loss of revenue, 36% said the greatest concern facing their business over the next 6 months will be finding new customers, and 48% revealed the area they plan to make the biggest investment in is digital marketing.
“Small businesses were among the hardest hit during the pandemic, facing higher rates of store closures, layoffs, and financial hardships, while competing with behemoth shopping sites taking a huge chunk of retail profits,” said David Sykes, Head of North America, Klarna. “As Americans head back into stores and continue to shop online, we are proud to dedicate resources to help small businesses offer flexible payment solutions that meet customer demand and reach Klarna’s network of more than 18 million US shoppers to further drive sales and marketing.”
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Over the coming weeks, 100 small businesses will be selected, located throughout the US and spanning the health & beauty, home & garden, jewelry & accessories, fashion, food & beverage, electronics, and entertainment industries. Many recipients include minority-owned and female-led businesses that were most impacted by the pandemic. 86% of minority-owned small businesses are concerned about the impact of the pandemic on their business’s future, compared with 72% of nonminority-owned businesses, according to the MetLife and U.S. Chamber of Commerce Small Business Index, and women-owned businesses were more likely to report a loss in sales by a gap of seven percentage points compared to male-owned businesses, according to a report by Facebook and the Small Business Roundtable.
“We had to push the launch of our store back last year because the demand for clothing decreased tremendously,” said Maya Caine, Co-Founder & CEO, MIVE. “Klarna has been an excellent partner in allowing customers to invest in sustainably and ethically made garments in a way that works with their budget. Slow fashion tends to be more expensive because the supply chain champions fair wages for garment workers and high quality, sustainable materials. Klarna is helping us transition folx to have consumption habits that are both beneficial for people and the planet.”
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“Like many small businesses across the US, COVID challenged our business operations and logistics,” said Sarah Li, Co-Founder and Chief Creative Officer, Element Mom. “Costs surged everywhere across the supply chain, eating up margins, and instead of passing the buck to the consumer, we scaled back on marketing and delayed certain investments. Being a recipient of the Klarna Small Business Impact Initiative gives our business a big boost with ad spend, while also allowing us to leverage BNPL payment solutions as a strategy for customer acquisition and increasing our average order value.”
Klarna helps brands find customers and customers find brands, putting merchants in direct contact with consumers without the high fees, restrictive access and anti-competitive behavior of e-commerce giants. Klarna’s Small Business Impact Initiative recipients will benefit from an array of services to help increase engagement, conversion rates, average order value, number of new and repeat users, and overall brand loyalty and preference.
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