How to go international with your ecommence
Ecommerce opens up a world of opportunities (pardon the pun). Being based online rather than in a physical location means you potentially have access to vast amounts of customers. You are restricted only by the number of countries you can deliver to; in theory any one of the three billion global Internet users can access your site and thus could potentially be converted.
But expanding into markets in new countries comes with a whole host of issues and although the opportunity is huge, the barriers can be tricky to overcome. Half of the Smart Insights team attended this years eCommerce expo this year, and I was there taking notes in the many talks on internationalising your ecommerce so I can pass on the best of that advice from industry experts onto you. So thanks to Miles Paterson (Global-e), Judith McElhinney (UK trade & Investment), Oliver Platts (Johnstons of Elgin), Paul Goldstien (Google), and Bianca Mercer (Aurora Fashion Group) for their insights in their talks.
For more tips and slidedecks from retailers grappling with the localisation channel I also recommend this post on International Ecommerce best practices.
Massive potential
A key theme that speakers kept coming back to when talking about international ecommerce were the shear scale of the opportunity it presented. This is important to keep in mind to get buy in for the project of adapting your site and logistical set up to be able to handle international orders. I don’t want to overload you with stats, but these few help to illustrate just how big the potential of international marketing is:
• PayPall Predicts 24% increase in international online commerce by 2017. This amounts to a massive £300 billion increase!
• The UK is the third biggest market for shoppers purchasing cross border. This is behind only the US and China.
• 82% of the Israeli ecommerce market is cross border buyers- This shows how much international ecommerce could grow.
• Accenture predicted that cross border online purchases would increase from 25% of global ecommerce sales to 50% by 2020. Doubling in just five years!
Location, Location, Location
Different speakers had different thoughts on which markets should be targeted. Miles Patterson form Global-e pointed out that most UK e-retailers tend to focus on UK language markets and the EU. This may not always be the best strategy. Reliance on the EU is a problem for UK e-retailers right now because of the current weakness of the Euro. He pointed to the massive opportunities for brands to increase ecommerce sales in Latin American countries, Japan and other emerging markets. China was also frequently mentioned, as it is after all the largest market in the world in terms of people (and will be for purchasing power within a few years).
Other speakers were more pragmatic and sceptical of the opportunities of these emerging markets. They advised that rather than coming up with a plan to ‘target’ certain markets and investing a big sum into creating local version of the website, translating pages and offering delivery options, the best way is to look at where traffic is currently coming from and use that as a basis for expansion. For example if you are UK based and currently offer delivery to France, Spain, Germany, Italy the Benelux and the US, but find you also get large amounts of web traffic from Canada and Israel, then you should consider investing in the logical capabilities to allow you to offer people in those countries to buy your goods. Similarly if you currently haven next to no web traffic from China, that may mean it is not the market for you (the Chinese market is notoriously hard to crack) and it may not be best in invest in being able to make sales there.
A good tool to use when conduct this market research is Google's ‘Global Market Finder’. It is a tool similar to Google’s keyword research tool, that lets you find relative opportunity in different markets by seeing who is searching certain keywords and how much they cost to run search ads on. For example if you sell iPhone cases with Lemmings on, you may find that large numbers of people in India are searching for that but it costs relatively little to set up a PPC search listing on that keyword, meaning you could potentially make a large profit.
Hurdles to overcome
If international ecommerce sales were easy, everyone would be doing them. There remain many major obstacles to a successful international ecommerce strategy, and you will have to take account of these when planning how to sell your products in new markets.
Paypall polled thosands of their customers asking what are the biggest barriers to them making cross border purchases. The top issues given by customers were to do with delivery. The number one issue was delivery cost and the 2nd was delivery time.
Import duty tax is also a nasty surprise for many cross border customers, and this can put customers off. One way around this is to use the VAT margin (VAT only has to be paid on goods sold in your home market) to subsidise delivery costs and pay import taxes. All speakers stressed the importance of being upfront with customers regarding import taxes, as it is better to let them know in advance rather than leave customers with a nasty surprise in store. Letting them pay import taxes with the purchase is useful, because otherwise they will often be an additional handling fees for customers to pay.
Being unsure about international returns policy is also a big reason why customers are put off making orders internationally. This can be reduced by being upfront with customers about the returns policy and in an ideal case offering local points to return goods to, so customers don’t have to organise to have their goods shipped across the globe to be returned.
Having the option to pay using local currencies also helps remove barriers to cross-border sales. When given the option to pay in their local currency 99% of customers do so- so it is clearly preferred! It is also always worth doing your research regarding the payment methods you should attract. For example 2/3rds of e-commerce purchases in Portugal are made using a service called Multibanco. If you don’t have an option for your Portuguese customers to pay using this service you could be seriously missing out.
Surmounting the obstacles
Once you have correctly identified the obstacles to growing your international ecommerce sales you can start working out how to overcome them. The speakers at ecommerce expo had plenty of interesting ideas on how to do so.
Location specific pop ups
If you don’t have fully localised versions of your site for different markets, a low-cost way of increasing conversions from non-home markets is to have location specific pop ups set up to trigger whenever someone from a foreign market lands on your page. These can inform them that they can buy goods from the site and are upfront about currency options and delivery costs. These can increase conversion rates considerably, as some people may see that the site is not based in their country and assume they won’t be able to purchase from it without bothering to check.
Translated websites
Having full versions of the website translated into a range of languages is obviously the ultimate goal if you are planning on building a major global presence. However this is very expensive and time-consuming, and thus may not be an option for your business. Many of your customers may also be able to speak English even though they are not from a country where English is the first language. For example if you don’t have a Dutch version of your website this won’t stop you making sales in the Netherlands given that 90% of Dutch people can speak English. A good option in this case is to keep the majority of the website as it is, because to translate it all would be very expensive, but have the payment page in their local language, as this will encourage them to purchase because it will be more familiar and appear more local. Because payment pages are generally not too content heavy, it should be relatively cheap to have it translated into many different languages.
Multiple Shipping options
Shipping costs or delivery time is a big reason why people are put off making international purchases. However offering different shipping options can help mitigate this. Offering cheaper options that may take a while to arrive won’t put off those that are looking to make savings but aren’t too worried about timing, whilst having more expensive delivery options will allow conversions from those that are time poor but cash rich. If shipping it a major problem for your customers it may be worth subsiding the shipping costs via the extra margin you make by not paying VAT as previously discussed.
Use eMarketplaces
eMarketplaces such as Etsy or Ebay are responsible for a lot of international ecommerce traffic, so getting your products onto such platforms can be an excellent way to boost sales. It is predicted by 2020 40% of all ecommerce will take place on the major emarketplaces, compared to 15% today.
Localise your marketing
When running ad campaigns in foreign markets to promote your ecommerce site, make sure that the marketing reflects that particular market. Creating localised and translated landing pages is good first step. Having people from that market appear in the imagery used by the marketing campaign is also a good idea, otherwise people may be inclined to not think it is applicable to them.
Summary
The opportunity of marketing internationally is massive, but it is no panacea, and nor is it easy. Make sure to have optimised your efforts in your home market first rather than expanding before your own house is in order. If your present ecommerce business is struggling then don’t look to international sales to save it, focus on your home market first then build outwards. If you have already built a thriving ecommerce business and want to expand further then you can potentially make huge gains, but be aware of the obstacles. Be up front with your customers and never try to pull the wool over their eyes. If you can, offer translated landing pages and payment pages, and research each market to see what types of payment options customers are likely to want. More than anything else, research which areas are looking at your products and concentrate on them, don’t be tempted to try to roll out to big markets that you are totally unknown in, instead go for the low hanging fruit first of markets where people are already searching for you.
Image credits: Nicolas Raymond and chris nyce
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