Consumers prefer paying by credit card online

Dubai: Cash on delivery (COD) may be a challenge many e-commerce websites face, but luckily, most customers prefer paying by credit card, speakers at a panel on e-commerce said on Saturday.

Founders of niche e-commerce websites discussed the benefits and challenges that “e-tailers” face, especially as far as payment for products was concerned at the ArabNet Summit on Saturday.

For Omar Kassim, founder of JadoPado, an online electronics retailer, 60 per cent of all transactions on his site are paid for with credit card whereas 40 percent are cash on delivery. “Paying by card is actually easier for everyone,” Kassim said.

According to JadoPado’s blog, the 60 per cent figure drops to 42 per cent when the transactions are made via mobile. The website cites the possible reason for this as more difficulty in entering card numbers on mobile devices, pointing to the need of a stronger system for mobile payment.

“Customers actually hate paying COD,” said Mona Ataya, CEO of MumzWorld, a mother, baby, and child online shopping site. It is actually a hassle for many consumers to keep large amounts of cash on them, according to Ataya, and those who use COD merely do so as a way to gauge the trustworthiness of the website.

“The first time they buy with COD to see if you do deliver,” Ataya said, adding that subsequent purchases would be made with credit card once trust had been established. “The UAE consumer is more apt to buy with credit card,” she told Gulf News. “I think in the next year you’ll probably see the COD levels drop.”

E-commerce websites also need to go beyond looking only at product sales and focus on improving content and engaging customers as well. “It’s not just about selling products,” Kassim said. “It’s about content, it’s about advertising.”

“You have to be remarkable. You have to be emotional to create traffic and divert traffic to your website,” said Sami Guzel, partner and CEO of Modanisa, an online store of hijab style fashion. “I think it’s all about the connection that you build with your community.”

The writer is an intern with Gulf News