Why retailers’ ads targeting millennials with Afterpay loans is a brand risk
Debbie O’Connor has noticed a worrying Afterpay ad popping up around Australia’s stores. The problem is, Afterpay aren’t the ones making it.
I saw an Instagram post recently that showed a poster in a shopping centre that read:
“Broke AF but strongly support treating yourself?”
It had the Afterpay logo at the bottom with the words ‘is now in store’.
I was browsing e-retailers last night to be served up ads on instagram this morning with the caption “Slay now, pay later, afterpay it”
These brands quite frequently feature the fact they have afterpay featured in their email marketing headlines as well.
The other major issue with afterpay is that I can go and create an account with fake details and rack up $1,500 worth of debt in minutes. The amount of under 18 girls I see in Facebook groups complaining that they can’t pay their afterpay and that they used a fake dob to create their account and are now scared they’re going to get in trouble.
Yes they should take some personal responsibility but why has afterpay allowed it to be so easy for an easily influenced minor to wrack up a large debt for their age that a maccas job ain’t going to pay off.
Afterpay has more to answer to than the questionable marketing tactics some companies are using.
Actually only 15% of Afterpay customers have trouble repaying their installments.
If you’re complaining about Afterpay and any post payment system then you’re being very ignorant to the little card in nearly everyone’s wallet called a credit card. Maybe youth debt is a result of poor parenting?? Maybe it’s poor self control?? Maybe it’s the cost of housing, rent and living that means people have to pay for their cloths in four payments?? But please don’t blame Afterpay because all they did was offer a service that actually works very well for 85% of consumers. They didn’t hold a gun to anyone’s head and they certainly didn’t get you intoxicated. You can’t buy Alcohol or cigarettes and use Afterpay to pay for them later… but there is that little plastic card in your wallet for that… and then the question pops up… who owns Visa and Matercard? Well it’s your 4 big banks… maybe you should all be questioning your investment with them????
“Only 15%” have trouble repaying? That’s actually quite a large proportion. And re credit cards, one point made by the author is it’s far easier to get an Afterpay account than a credit card.
I hope the banking enquiry see’s this.
They’re already grilling the old GE Consumer Credit business, Afterpay and ZipMoney should be called up too.
Afterpay must have huge Bad Debts if there are no or slack credit checks with Afterpay if these people are not paying back their loans then surely Afterpay will soon be in financial trouble ?
I know the credit checks with ZIP are strenuous and protect the purchaser.
Great article – I’m working on a fintech app that’s designed to help millennials better manage their finances for the longer term. When I saw AfterPay hit the market, I commented that it was the antithesis of what was needed. Cynical, greedy marketing.
You’d think with a banking royal commission on right now they’d be a little more careful; and NAB, by association.
Actually only 15% of Afterpay customers have trouble repaying their installments.
If you’re complaining about Afterpay and any post payment system then you’re being very ignorant to the little card in nearly everyone’s wallet called a credit card. Maybe youth debt is a result of poor parenting?? Maybe it’s poor self control?? Maybe it’s the cost of housing, rent and living that means people have to pay for their cloths in four payments?? But please don’t blame Afterpay because all they did was offer a service that actually works very well for 85% of consumers. They didn’t hold a gun to anyone’s head and they certainly didn’t get you intoxicated. You can’t buy Alcohol or cigarettes and use Afterpay to pay for them later… but there is that little plastic card in your wallet for that… and then the question pops up… who owns Visa and Matercard? Well it’s your 4 big banks… maybe you should all be questioning your investment with them????
Free enterprise and duty of care do not have to sit together. You can only hope for the second. But you can’t slam a credit company because its legal product is used irresponsibly. Your lecture should include warnings to this young market about coffee and Tinder as well. Afterpay will have worked out the bad debt risk long before this article. If they fall over, they are too naive to have even started.
Of course retailers are advertising their available credit options. Why shouldn’t they use the Afterpay logo?
On the plus side, Afterpay is providing opportunities for startup traders and local lines who find the bank options leave them out of credit offering to their smaller market.
An exceedingly patronising article, particularly with reference to “ older readers” needing to look up AF. WTF?
Possibly because the logo is a trademark and, therefore, permission is required to use it?
Afterpay could not approve those ads they are essentially illegal and cause issues with their AFSL which they need in order to trade.
Afterpay are doing amazingly well, all credit to them. They’ve taken the traditional interest free purchase and made it work. Millennials have so little $, it is perfect for them.
An interesting first month for their new CMO Vicki Aristidopoulos because whoever is producing those ads will be in a mountain of trouble with ASIC, ACCC etc.
Afterpay’s share price has rocketed recently but there’s an increasing number of short positions:
https://www.shortman.com.au/stock?q=APT
Explain the difference between racking up debt on a credit card vs Afterpay?