Improving the Cash on Delivery Experience for an E-commerce Platform
A leading e-commerce platform in India wanted to understand the needs, preferences, and challenges of its merchants who use cash on delivery (COD) as a payment option. COD is a popular and widely used payment method in India, but it also poses some risks and difficulties for both merchants and customers. The platform wanted to improve its COD functionality and services to provide a better experience for its merchants and their customers.
The platform hired us, Ethnity, a UX research agency based in India, to conduct a comprehensive study of the COD experience of its merchants. Ethnity was asked to explore the following aspects of COD:
- How do merchants set up and manage COD on their online stores?
- What are the benefits and drawbacks of offering COD as a payment option?
- What are the main challenges and pain points that merchants face with COD?
- How do merchants handle COD orders, payments, refunds, and returns?
- What are the satisfaction levels of merchants with their current COD providers and solutions?
- What are the opportunities and recommendations for improving the COD functionality and services offered by the platform?
Ethnity conducted remote video interviews with 12 Indian e-commerce merchants who use COD as a payment option. The merchants were selected based on their product categories, platform plans, and COD order volume. The interviews lasted for 60 minutes each and covered topics such as:
- Merchants’ background, roles, and online store overview
- Factors for choosing COD and other payment methods
- COD setup process and requirements
- Checkout experience and customer behaviour
- Order fulfilment and remittance process
- Support mechanisms and fraud prevention
- Functionality evaluation and feedback
Ethnity also collected data from the merchants’ online stores, logistics providers’ dashboards, and e-commerce platform settings to supplement the interview findings.
- The study was conducted by Ethnity, a UX research agency that offers end-to-end UX research services across various domains and platforms.
- The study involved 10 Indian e-commerce merchants who use COD as a payment option, representing different product categories, platform plans, and COD order volume.
- The study used remote video interviews as the primary research method, complemented by data collection from online sources.
- The study generated rich insights into the needs, preferences, challenges, and opportunities of merchants who use COD as a payment option.
The study revealed that:
- Merchants receive mostly COD orders, mainly due to the lack of trust on new online brands, cash preference of Indian customers, and risk aversion of online shoppers.
- All merchants offer a full suite of online payment methods (such as card payment, UPI, digital wallet) through popular payment gateways.
- Most merchants work with logistics aggregators because of their maximum pin code serviceability, better pricing, and good customer support.
- Most merchants want more prepaid orders as they mean fewer RTOs (return to origin) and customer returns. They are willing to offer additional discounts to incentivize customers to switch from COD to prepaid.
- Merchants use dashboards of logistics aggregators or logistics companies to fulfil orders. They face challenges such as cumbersome fulfilment procedures, difficult order tracking, late deliveries, discrepancies in package weight or dimensions, etc.
- Almost all merchants manually screen COD orders for fraudulent orders. Some merchants use third-party app to detect fraudulent orders. They also use other apps for order confirmation by sending automated SMS, WhatsApp or IVR calls.
Based on these findings, Ethnity provided several recommendations for improving the COD functionality and services offered by the platform. Some of these recommendations are:
- Providing an option to handle returns in the platform dashboard.
- Developing a better delivery alert mechanism for COD customers to reduce RTOs.
- Offering automatic COD payment reconciliation in the platform dashboard.
- Showing available coupon codes below the apply coupon code option on the checkout page.
- Enabling a single-page checkout process to reduce abandoned carts.
- Detecting whether the customer’s mobile number has 10 digits or not in the checkout form.
The client appreciated the insights and recommendations provided by Ethnity. They implemented some of the suggestions and saw positive results in terms of increased prepaid orders, reduced RTOs, improved customer satisfaction, and enhanced merchant loyalty.