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Klarna, most associated with its buy now, pay later services, is an internationally recognized technology company that has rapidly risen in recognition over the past few years. Part of its success comes down to its strategy of aligning incentives with its consumers, creating a win-win situation for all parties involved in transactions.
This has been coupled with staying on top of evolving ecommerce trends, such as the gradual shift towards hyper-personalization. To learn more about its rise to success, we sat down with Klarna’s chief marketing officer, David Sandstrom.
In today’s episode of The Speed of Culture, Matt Britton sits down with Sandstrom, and together, they discuss his agency background, the evolution of ecommerce, and how aligning incentives with consumers has helped Klarna become an internationally recognized business.
Key Takeaways:
- 00:31 – 03:53 Gaining unique insights into consumer behavior and different industries
Sandstrom has spent much of his career working in some of the biggest agencies in the Nordics. Starting as a strategist, he was tasked with trying to understand what makes people tick. Within the agencies, he applied himself to many different businesses, seeing how other models and industries worked—everything from the Swedish Armed Forces to McDonald’s. He learned that creativity is about putting different pieces together, an idea he brought to Klarna. In his current role as a CMO, he is weaving together all the learnings from his agency past, bringing a unique perspective to the company. - 09:42 – 13:21 Align incentives with your customers
Klarna offers alternative payment methods to people who shop online, most notably their buy now, pay later plan. Sandstrom believes that Klarna is a much better alternative to credit for both consumers and merchants. Instead of individual consumers being responsible for interest, with Klarna’s plan, the onus and associated risks fall on large merchants. Klarna has aligned its incentives with its customer base, guaranteeing a positive outcome for all parties, and David recommends digital companies do the same to be successful. - 19:00 – 22:00 Stay aware of ecommerce trends
Sandstrom argues that we are in the third phase of the ecommerce evolution. Initially, it was about consumers searching for things through Google and Amazon. Then, it became about goods searching for customers, with many DTC companies cropping up and creating customer needs. With the introduction of AI, we are entering a hyper-personalization period, with products getting automatically matched to consumers. We already see this in China, where online searches have plummeted, and products are sold through recommendation engines. Big tech companies have a head start in this new wave and can predict when their consumers will need or want a particular product, but smaller businesses should also stay aware of these shifting trends in the space. - 28:22 – 32:43 A hands-on approach to being CMO
Sandstrom approaches his role as CMO by setting the tone with the work that he does and avoiding delegating. He selects key projects for the next quarter and works intensely within the teams to help produce and shape them. He believes that low-quality work at other companies comes from too much delegation. It’s about holding on to the startup mentality for as long as possible, executing the projects that set the tone for the brand.
