Definition
COD, cash on delivery, is a payment method in which the customer pays a courier in cash at the moment a physical product is handed over, rather than paying online in advance. It is the dominant payment model for nutra and physical-goods e-commerce affiliate offers in markets with low card and bank-account penetration — much of Southeast Asia, South Asia, parts of Africa, the Middle East and Latin America — where asking for a card upfront would collapse conversion.
COD is not used in iGaming, which is a digital, prepaid product, but iGaming media buyers often encounter COD offers because they run on the same traffic sources.
Under COD the affiliate's conversion is the confirmed order — the user filled the form and, often, confirmed by phone with the advertiser's call centre — but the advertiser only realises revenue when the parcel is delivered and the cash is collected. Between order and delivery, a significant share of orders fall through: the customer is unreachable, refuses the parcel, or the address is wrong.
This delivery or buyout rate, which varies by GEO and by the quality of the advertiser's logistics and call centre, is what turns a headline payout into an effective one.
In context
Because the affiliate is paid on the delivered order, not the form fill, COD offers make cash flow and approval-rate transparency the central concerns. An affiliate needs to know the historical buyout rate for the specific offer and GEO, the payment terms (delivered orders are usually paid weekly or on longer cycles), and how the advertiser handles disputed deliveries.
A $20-per-delivered-order offer with a 55% buyout rate has an effective payout of about $11 per confirmed lead, and a campaign that looks profitable at $20 may be a loss at $11.
The call centre is a hidden but decisive part of COD economics. Its contact rate, its script quality and its upsell take rate all move the number: a good call centre reaches most customers, confirms the order, adds an upsell, and reduces refusals at the door; a poor one leaves orders unconfirmed and buyout rates low.
Affiliates running COD therefore evaluate the advertiser's operation as much as the offer, and a strong logistics-and-call-centre operator is worth materially more per lead than a weak one at the same headline payout.
Worked example
A nutra offer pays $18 per delivered order in a COD market. The advertiser's buyout rate is 55% and its call centre adds an average $6 upsell.
The affiliate's effective payout per confirmed lead is about $10 before the upsell share, so a campaign acquiring confirmed leads at $6 is profitable while one at $12 is not.
Frequently asked questions
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