Remember when the term cash-on-delivery (CoD) used to be a byword among traders in the Philippines? During those times, merchants opted for CoD because it offered them a practical and secure choice.
The CoD process is really simple: customers select CoD as their payment option once they check out. They will then only have to pay for their order once it arrives.
Once their delivery comes, the buyer can check the product, pay for it, and then complete the transaction. When the seller receives the payment, they can close the order and mark it as a completed transaction.
From being a simple payment option to a form of protection from online scams, CoD payment terms also allowed business establishments to look out for their patrons, especially the non-tech-savvy ones.
But that was probably before the COVID-19 pandemic.
According to a top executive from Lazada Philippines, CoD payments nowadays are starting to decrease on the e-commerce platform, with more customers now opting for faster and more modern alternatives like paying with digital wallets.
At a recent media event in Taguig City, Lazada Philippines Chief Executive Officer Carlos Otermin Barrera shared that the company is starting to lose relevance every single year. According to him, one of the main causes of this fall is the increase in the use of digital wallets during the coronavirus pandemic in 2019.
“Wallets are now known by a lot more individuals, and the pandemic has significantly expedited the wallet trend. People continue to use their wallets because they have already formed a habit of doing so,” Barrera said in a press release, adding that they are currently offering very payable financing terms and are now giving more people access to a variety of things.
“Lazada is all about trust and convenience. Regarding our LazPay and LazPayLater services, we have high goals. We have our own set of wallets,” he added.
He claimed that Lazada’s offerings, including LazPay and LazPayLater, have also aided in customers’ shift away from the cash-on-delivery payment option.
Furthermore, according to Lazada’s top executive, the company had been enticing more customers to utilize digital wallets rather than CoD by offering incentives like free shopping coupons, vouchers, and greater discounts.
Barrera noted that Lazada currently spends a lot of money on the best promos for customers who don’t have cash. “We constantly provide the best coupons to individuals who use wallets, whether it be in the form of free shipping coupons or larger percentage discounts, together with our partners like GCash and PayMaya,” he said.