What is Pay After Delivery
Pay after delivery (PAD) is a payment solution that is fast becoming a favorite option for customers who are looking for flexible alternatives. Designed to offer a solution to ecommerce customer quandaries, it’s an innovative tool that can be used to diversify your checkout experience, encourage customer loyalty, and drive growth.
Read on to learn everything you need to know about PAD and how Splitit can help you implement it seamlessly into your sales strategy.
What is pay after delivery (PAD)?
Pay after delivery is a payment option that works exactly like you might expect – customers order an item, receive it, and then pay for it once they have had the chance to inspect it and they decide to keep it.
The main differentiator of PAD compared to other payment options is that, instead of paying upfront, customers receive their products before committing to them financially.
Unlike traditional ecommerce payment methods, PAD allows shoppers to assess their items for quality, suitability, fit, and whatever other factors are important to them before they hand their money over to the retailer. It bridges the retail gap between ecommerce and in-store by giving customers the chance to inspect products before deciding to purchase them.
Learn more about how pay after delivery is a catalyst for online sales growth.
How PAD Works:
Depending on the retailer and the service provider, pay after delivery processes will vary.
From a customer perspective, it generally follows these steps:
- Customers choose PAD as their preferred payment option in the online checkout
- They enter their payment information, but their card will not be charged yet
- The purchase is shipped to the customer
- The customer receives their purchase and has a set period of time to inspect, test, and assess the products
- If they are happy with their purchase, the customer lets the retailer know they want to keep them and their payment method will be charged
- If they decide to return the items, the customer follows the easy return process that the retailer has arranged, and their card is not charged
For retailers, PAD is a tool that can be integrated into their ecommerce experience. With Splitit, you can add pay after delivery as white-label solution that becomes a holistic part of your brand. With easy integration with all major ecommerce platforms and payment providers, it will become a seamless part of your website and user journey.
Benefits of Pay After Delivery
Pay after delivery is already a popular payment method in many European countries and is growing in the United States – and for good reason. It offers a variety of benefits for customers, satisfying modern expectations and solving historical ecommerce challenges.
Increased Confidence
PAD helps retailers to showcase their confidence in their brand and in their customers. By allowing shoppers to receive your products before paying for them, you are telling your audience that you believe in the integrity of your products, and that you respect your customers enough to allow them the opportunity to inspect the items they’re interested in before deciding whether they want to pay for them.
Pay after delivery boosts customer confidence and can help to drive loyalty and retention. Once your audience has had the chance to go through the PAD process, familiarize themselves with your products, and have a positive experience, they are more likely to return and become ambassadors for your brand.
Reduced Cart Abandonment
Pay after delivery can help boost conversion in the checkout, as it offers a solution for customers who may not be entirely committed to making a purchase. It removes these barriers, as shoppers don’t need to pay upfront and commit their money to a product that they might not be sure about.
Instead of tying up their funds in a purchase that they may not yet be sold on, they have the opportunity to receive the product and make a well-informed decision before committing. This flexibility is a great way to offer solutions for customers who like to research and inspect products, as well as those who are looking for budget-friendly ways to shop online.
Benefits for Merchants
As well as benefitting your customers and encouraging loyalty, PAD can help you streamline your operations and bring a unique aspect to your overall sales and marketing strategy. It’s a tool that can drive conversion, sales, and AOV, helping you grow your business and target specific customer profiles.
Competitive Advantage
PAD is still a relatively new tool for North American retailers, which means it can give you a competitive advantage and differentiate you from other businesses in your sector.
In the busy and cluttered ecommerce landscape, retailers must look for ways they can offer their customers a unique value proposition and provide them with the innovative solutions they’re looking for. PAD satisfies the needs of budget-conscious shoppers, as well as drives conversion for customers who may be uncertain or on the fence about committing to you and your brand.
Decreased Return Rates
The churn of returns can take a big toll on ecommerce retailers, as it requires a great deal of resources to protect the value of your inventory while providing the best possible customer service.
PAD can help dramatically reduce this workload, as it offers an alternative avenue to the traditional purchase/return cadence. In the event a customer decides to send a product back, there’s no need to go through a complicated refund process as their card wasn’t charged in the first place.
PAD also helps retailers establish a smooth return experience in which customers can quickly and easily send back the products they decide not to keep. Implementing this flow upfront reduces the long timeline and potential confusion that can arise during a traditional return or exchange journey.
How to Use Pay After Delivery with Splitit
With Splitit, you can reap all the benefits of PAD with guaranteed payment for your products and services.
Our platform is designed to integrate seamlessly with your existing brand and ecommerce journey, making it easy for your customers to learn about PAD and choose it as their preferred option – and making it easy for you to drive conversions, build loyalty, and add a competitive edge to your operations.
You can also choose to pair PAD with installment payments, offering your customers the added benefit of a flexible repayment plan that fits their budget and lifestyle. It all works with your customers’ existing credit card, which means there’s no need for additional financing, long applications, or credit checks.
Get in touch to learn more about how you can introduce pay after delivery to your ecommerce journey.