'Pay On Delivery' Is A Short Cut To Buy Customers' Trust - Printivo Boss
So, pay on delivery, PoD has been a thorn in the flesh of e-commerce in Nigeria.
In fact, many e-commerce businesses, especially those in the online retail segment have struggled because of the payment system.
The major argument against PoD is that it leads to waste of resources. It leads to e-commerce companies expending resources to fulfill orders that are eventually returned or rejected because the owners were just passive shoppers or changed their minds after they placed the order.
This has caused problem for many investors in the sector. Some have been forced to close shop. Some others have continued to trudge along, hoping that some day, customers will trust them well enough to pay before items are delivered.
In the midst of these, there are some players in the sector who have refused to accept PoD. But instead of their businesses suffering as a result, they have prospered.
One of such businesses is Printivo.com, Nigeria’s premiere online print-on-demand service. At Printivo, you can order a print product online and have it delivered to you anywhere you may be in Nigeria.
Despite sticking to payment before delivery, the online print shop has grown significantly over the past four years, racking up millions of dollars in venture capital funding.
The CEO of Printivo.com, Oluyomi Ojo was a guest on Bounce Masterclass and he spoke on how the company succeeded despite rejecting PoD.
He said: “The first thing is that you need to understand the space that you are in. We are in a space called mass customisation. What this means is that everything we ship out of Printivo is customised.
“This means that you can’t return that order because you feel like you want to return it. Because of this, pay on delivery would not have worked for us.
“If we shipped anything to you and there is no payment on your side, there is no commitment but it is customized 100% for you. What it means is that if we run cost to fulfill that order, and to get that order from our facility to your doorstep and you say no because you have not paid, we cannot sell that order to someone else.
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“For this reason, from day one when we threw our doors open, we were very deliberate about the fact that we will not do pay on delivery.”
He added: “It is important to know that the business of e-commerce is not about products, but about trust. So, pay on delivery is a shortcut to bypass trust.”
Speaking further, he said: “The payment on delivery problem for e-commerce is not just a Nigerian problem. This is an emerging market problem. And I think we are teaching the customers the wrong thing, because we are not ready to do the hard work and we are not committed to growing slowly and doing the work it takes to build trust.
“E-commerce is trust business and proponents of pay on delivery believe that by giving the customer the power to pay on delivery, we can bypass that trust element. I don’t think that is the case.
“Unfortunately, e-commerce in Africa now runs on pay on delivery. But if there is no commitment on the customer’s side and you fire all your infrastructure to deliver that order and the customer walks away, because it was just a trial; imagine doing that for 5,000 times in a month? That is never good for any business.”
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