Klarna Saves $10M Annually Through Gen AI Integration

Klarna, a leading buy-now-pay-later (BNPL) provider, has reported annual savings of $10 million by integrating generative AI (Gen AI) into its marketing operations. This move has significantly reduced marketing costs while increasing campaign frequency and engagement.

In Q1 2024, Klarna cut its sales and marketing budget by 11%, with Gen AI contributing to 37% of the cost reductions. By utilising AI tools like Midjourney, DALL-E, and Firefly, Klarna has decreased image production expenses by $6 million. These AI-generated images, featured on Klarna’s app and website, have enhanced user engagement.

David Sandström, Klarna’s Chief Marketing Officer, highlighted the efficiency gains: “AI is helping us become leaner, faster, and more responsive to customer needs, creating a better experience while saving tens of millions of dollars annually.” Sandström added that AI allows for the production of bespoke imagery without the high costs associated with traditional methods, eliminating the need for stock images.

Klarna produced over 1,000 original images in Q1 2024, reducing the image development cycle from six weeks to seven days. Besides image production, Klarna saved an additional $4 million by reducing reliance on external marketing suppliers for tasks such as translation and social media production.

The impact of Gen AI extends beyond marketing. Klarna’s partnership with OpenAI has introduced an AI assistant in its customer service division, handling the workload equivalent to 700 full-time agents. This initiative has led to substantial operational efficiencies.

Klarna’s CEO and Co-founder, Sebastian Siemiatkowski, emphasised the widespread adoption of Gen AI within the company. “87% of our workforce regularly uses the OpenAI AI assistant to support daily tasks. We encourage continuous testing and exploration of AI to drive employee empowerment and improve customer experiences,” Siemiatkowski said.

A survey by GlobalData indicates that 27% of companies have a high adoption rate of Gen AI tools, reflecting a growing trend across various industries.