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Play.com pay-on-delivery service touted

by Steven Williamson on 23 January 2012, 10:55

Tags: Play.com

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Play.com could become the first major UK online retailer to allow customers to pay for items on delivery.

Payment-on-delivery gives customers who may be wary of paying for goods online an alternative payment option that they may deem to be safer. It’s a business practice that’s common in Japan, apparently reducing return rates, and a move that Play.com’s Japanese owner, Rakuten, is keen to implement.

“Shipping issues are the most common reason for cart abandonment in Europe. We only offer a few shipping models. That’s alien to Rakuten. We’ve got to be more flexible to grow,” marketing director Adam Stewart told Retail Week.

The new plan is part of Play.com’s strategy in 2012 to increase its customer service offerings, starting with the introduction of new categories on its website and better optimisation for customers browsing with their smartphones.

“The original strategy was to increase the categories Play sells in at a phenomenal pace but the Rakuten model is focused on the market place. We will increase categories through what our merchants choose to sell through us rather than creating our own categories,” said Stewart.

Source: Retail Week


HEXUS Forums :: 9 Comments

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Posted by jim - Mon 23 Jan 2012 11:08
Seems like a nice idea to me, would certainly be a much better system than the current implementation of DSR - i.e. money leaves account, wait several weeks, see if money is back, chase up firm, etc.

On the flipside, I reckon it could be pretty heavily abused. If you want a videogame on release date, no worries. Order from three different websites, no initial cost, when the first one arrives stick it in the machine and start playing. When items 2 and 3 arrive, return under DSR without payment. Return rates could rocket rather than dropping.

Not to mention the poor couriers. Standing around for ages on the street whilst Mrs Jones finds her credit card, and Mr Smith forgets his pin. And you can imagine how livid someone would be if their brand new PC arrives, sitting in a box on the driveway, and then the courier says “Sorry, your card was declined. No, I can't take cash.” and then wanders back to the van, puts it back in and drives off. I wouldn't want to be that courier. They would probably charge a fortune for that kind of service, which means only one thing - increased prices. Whether that will be per-item or across the whole store I don't know, but neither are going to help.

In the first instance, you're going to struggle to convince people to take up the service, and in the second you're going to give up your old customers to your rivals, where they can shop online “old-style”.

Nice idea, not convinced.
Posted by elvedhel - Mon 23 Jan 2012 11:10
have you seen some of the couriers out there. i wouldnt trust em with a paper plate let alone collecting payments
Posted by BongoJoe - Mon 23 Jan 2012 11:29
The new idea is no use to me - I'm always at work when the courier calls. Sometimes when I am at home the courier expects me to answer the door within eight seconds or he's off on his way to his next victim. I reckon the C.O.D. business model is going to be very low volume.
Posted by Biscuit - Mon 23 Jan 2012 11:40
I get stuff delivered to work so this is of no use to me
Posted by Spud1 - Mon 23 Jan 2012 13:22
snootyjim
Return rates could rocket rather than dropping.

It's the opposite really - and this is why I really do love statistics and management ;)

Return rates would actually fall drastically if this is implemented correctly and taken up - simply because the items refused would not be a return, as it would never have been sold in the first place. It's a normal sort of trick in most businesses..reclassify something and suddenly your stats look better or worse depending on who you are talking to. In this case the idea of returns dropping immensely sounds great to the media, even if in reality the rates are going up.

It would still save money though on the returning of stock to the warehouse, checking it's condition, issuing refunds etc etc.

I do wonder about the DSR rules here since technically it's not sold until on the doorstep, and you are given a chance to inspect the purchase first..so we could have some rather interesting issues around that.

Good marketing idea in principle - most of the big couriers are already setup to collect payments for import tax/duty on the doorstep, so this isn't a massive jump. I still don't think it's right for the UK marketplace though.

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