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Ram Ravichandran

CTO, Narvar which is trusted by retail’s best with 650+ customers across the globe, as it has simplified the everyday lives 200 million digital shoppers

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How can retailers make cash on delivery purchases a competitive edge?

A Nielsen report pegs COD transactions to about 83 percent of overall ecommerce purchases


Cash on delivery (COD) is the most common form of payment for online customers in India. A Nielsen report pegs COD transactions to about 83 percent of overall ecommerce purchases. What is leading to such high volume of COD transactions - multiple factors - like the familiarity and comfort of transacting in cash, especially in Tier-II and III customers, there is also a gap in digital payment infrastructure and most importantly is the lack of customer trust when it comes to shopping online.

Given this scenario, how can retailers make sure that the experience provided to COD customers is at par with other customers. How can retailers drive trust and loyalty? Unlike numerous payment options provided by ecommerce retailers, COD is the only one that allows shoppers to pay for the product at the time of delivery as opposed to paying while placing the order. While a lot has been written about retailers and their struggle to cure Indian shoppers of COD transactions, there are several opportunities to make COD a tool to retain customers. In most COD cases, the carrier partner is unable to fulfil a delivery as the customer is not available to receive the order. The carrier informs the retailer of this status at the end of the day, post which the retailer gets in touch with the customer to seek a response for a rescheduled delivery date. This information is passed back to the carrier. The carrier reattempts the delivery and often ends up in the same loop. This entire information chain takes more than 3-4 days, leading to unhappy customers, reduced operational efficiencies and returns.

It is important to remember that online shopping results in high anxiety for shoppers due to quality, price and delivery of the product and can leave the shopper overwhelmed. And once the customer places an order, there is high anticipation regarding the product delivery status. For a retailer, these can turn into golden moments to not only engage with customers but also build trust and loyalty. Investing in simple post-purchase solutions go a long way. It starts with keeping the customer informed on the status of their order delivery, providing them with self-serve platforms to manage non deliveries and returns. A simple case in point is with missed deliveries, instead of having the customer get in touch with the customer care or keep them waiting for a delivery partner to reattempt the delivery, provide the customer with a self-serve platform that not only keeps the customer informed on the real time status of their order delivery but also lets them reschedule or redirect their order depending on their availability. This keeps the customer in control, enables the retailer and delivery partner to take informed steps and improves operations.

Customers prefer retailers who value their time and provide proactive information about their orders. Giving them choice to select their communication medium to receive order related information leads to convenience. COD has changed the way Indians shop online and has brought in millions of additional customers to online shopping. Adding reliability and convenience to COD purchases will play a vital role in improving customer experience for any retailer who aims to thrive in the ecommerce ecosystem.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house

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cash on delivery retailer shoppers ecommerce

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