Straight Sale or Cash-On-Delivery Offers? (4)
Straight Sale or Cash-On-Delivery Offers?
If you have been following the news about our CPA offers (which we hope you did through our website and weekly newsletters), you must have noticed that we started adding cash-on-delivery offers. How will you benefit from cash-on-delivery as compared to straight sale? What are the peculiarities of COD offers? In this short post, we will try to answer these questions as succinctly and informatively as possible.
What Is Cash-on-Delivery?
Cash-on-delivery (also referred to as collection-on-delivery) is a product purchase scheme where a customer pays for the product after it has been delivered. To order, a customer has to submit only a phone number, and then a call center agent will call to confirm the order. Even though there is a “cash” part in the name, the payment can in fact be made using a few options including certified checks or money orders.
What Are the Benefits of Cash-on-Delivery Offers?
The COD has been created to allow ordering without providing credit card details and to add security, which is its primary benefit. We all know the sequence – fewer form fields means fewer abandoned carts, which in turn means more sales.
But there is also another major benefit – the COD option is available for countries where there is no infrastructure for credit card payments. In other words, Tier-2 countries that are less competitive markets. Lower competition means more opportunities for you as a performance marketer, especially if you are only starting out.
Here is the tricky part: the conversion occurs when a customer confirms the order via phone, which allows for some time between ordering and confirming to change their mind. This removes impulse buyers from your target audience.
On the other hand, when there are multiple form fields to fill out, what kind of spontaneity in buying can we be talking about?
On the security end, customers are more inclined to buy from a company, especially one they know nothing about, when there is a possibility to check the product before paying. The lack of online transaction also means no possibility of identity theft and other credit card manipulations.
Which One to Choose?
As always, the choice will depend on your traffic, goals, and offers. If you are going strong on the Tier-1 market, then there is no reason to use COD offers. If, however, you are targeting less competitive geos (Latin America, Asia, etc.), cash-on-delivery might be just what you need to have a stable flow of orders.
Disclaimer: I'm NOT running with BizProfits, so what I'm about to say is NOT directed at them - I'm merely talking about a common phenomenon - one that I've observed for several networks that have COD offers, that I've either worked with or have heard about.
COD offers are a great idea, and can convert very well with the right targeting and advertising angles - that's the part we affiliates CAN control to a certain extent.
A big problem with many COD offers - one that affiliates have very little control over - is the fact that many call centres are not adequately staffed to call the lead within a reasonable timeframe.
A good friend of mine has actually confirmed our suspicion, by asking another friend to sign up as a lead. He didn't receive a call until 5 days later.
5 DAYS (!!!!!)
More than enough time for buyer's remorse to set in, for the impulse buyer to have second thoughts, to do further research and decide to purchase an alternate product, etc...
There's precious little we affiliates can do about that. But here's a tip: Try to run traffic only during call centre hours (or the first part thereof). That way at least SOME of your leads will get called the same day. Avoid the weekends altogether - most call centres don't work over the weekend. So any leads you send during that time will get piled up until the following week - and by the time the operators have cleared the backlog it may be mid-week already (I'm guessing that was how the 5 days came about).
Not all networks would be willing to reveal their call centre hours. But if you ask very nicely - especially after you've sent some leads first - they may oblige.
Amy
Originally Posted by vortex
Another point here, that it's very important to be aware of your leads. I mean, if you run COD directly, ask your account manager to provide a report on your leads - how many are in hold or declined.
If you run this offers through network, you can ask your AM to provide this kind of report.
But I'm totally agree that there's an issue, which is not up to publishers. That's why never send huge volumes until you 100% confident about the offer you run.
Sean
But I'm totally agree that there's an issue, which is not up to publishers. That's why never send huge volumes until you 100% confident about the offer you run.
Another way of putting your second point: Don't scale traffic until you're sure about the percentage of holds that are turning into sales. Don't scale just based on a few holds, or even a bunch of holds. I've made that mistake in the beginning: I got a bunch of holds and I assumed that at least some of them would turn into sales. In the end they were stuck in "hold" status for a month and then got canceled.
So run until you have some holds, then pause traffic until you see some turn into sales so you have an estimate of the ROI, and only resume traffic if the ROI is acceptable to you.
Amy
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