Clearpay helps Marks & Spencer tap millennial generation

Written by Ruby Hinchliffe
8th November 2019

Clearpay says its no interest fee model is helping Marks & Spencer grab the attention of the millennial generation.

Clearpay CEO: “Marks & Spencer is in a turnaround moment”

“Marks & Spencer is in a turnaround moment,” Clearpay’s CEO Carl-Olav Scheible tells FinTech Futures. The retailer was a huge part of the establishment of the UK high street, and even now “everybody’s mother is its customer,” says Scheible.

But now the 1884-founded British retailer is undergoing a millennial revamp, which Scheible thinks was a “big part” of the reason why Clearpay, the UK arm of Australian-founded Afterpay Touch, was chosen as a paytech partner.

When asked how Clearpay defines itself, Scheible is reluctant to put the company wholly into a fintech or a retail camp. Instead, it seems to sit somewhere in the middle in what he calls “retail tech”.

With 29-year-old retailer Nick Molnar at its head, the company distinguishes itself from the likes of Klarna and Laybuy. “All these other providers are financial institutions, we’re not”, Scheible says simply, noting that it charges the merchant rather than the consumer.

Afterpay’s CEO Nick Molnar

This was another big draw for Marks & Spencer. With a bank already in its armoury, a partner like Clearpay wasn’t going to compete with its own services.

Consumers wishing to use Clearpay can set up a free account and attach their debit card before going through a partner merchant’s checkout. The consumer will pay 25% of the item at the point of sale (POS), and then pay back the remaining three quarters in 25% installments every two weeks for six weeks.

“We don’t give you an open-ended credit line,” Scheible says. “We basically just allow you to stretch the payment time.”

Consumers see Clearpay as a free budgeting tool which allows them to manage cashflow and pay over two pay cycles according to Scheible, who notes the launch of its UK app last week which saw 40,000 downloads in 24 hours.

The app acts as a shopping directory for all its merchant partners, meaning Marks & Spencer will now be listed alongside the likes of millennial fast fashion brands Boohoo and Pretty Little Thing.

“We’re the largest driver of traffic after Google for merchants in Australia,” says Scheible, who reveals the company generates eight million leads a month for its partners across the pacific.

Having launched just six months ago in the UK, its track record in Australia could lead to notable disruption in the UK high street market.

Clearpay’s CEO Carl-Olav Scheible

With a customer base mainly made-up of millennial women looking for fashion, beauty and accessory products, Scheible makes it clear that the company intends to keep within this niche for the foreseeable future, rather than getting into industries like homeware.

When asked about the state of the UK high street, Clearpay’s UK CEO talks about the collaborative network we’ve seen of late. He points out how ecommerce platform Ebay and physical retailer Argos have joined forces to do item pick ups, for example.

“I don’t believe the highstreet is dead at all, I think it’s very vibrant.”