International eCommerce Expansion: 15 Commonly-missed Action Items
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It’s now a well-known fact that Covid-19 set in motion a burgeoning movement for global eCommerce.
According to Morgan Stanley, the global market has the potential to grow up to $5.4 trillion by 2026.
It’s undeniably a heartening picture. However, it’s also riddled with increasing complexity.
Competition is continuously on the rise and technology is evolving at high speed. Combined with laws and regulations and heightened need for marketing strategy, global expansion will get more challenging.
However, businesses will need to expand elsewhere as they reach their full potential on the home ground.
So we decided to create a list of global eCommerce expansion action items that may be easily overlooked in the pursuit of more important to-dos.
It’s tempting to hit as many regions as possible at one go, when you’re attempting global expansion.
However, this could be problematic for a number of reasons including not finding the right market fit, making misjudgments about your target audience etc.
This is why figuring out the markets that would be most aligned with selling the products you’ve got to offer is vital.
When it comes to high-growth regions, China, US and UK followed by some parts of the APAC region have been seeing a lot of eCommerce mileage.
But according to Statista, multiple countries in Asia showed the highest growth in eCommerce sales in 2022.
Given the varying forecasts, it may be necessary for you to leave generalizations aside and target high-potential growth regions based on the following:
Test and optimize thoroughly if you’re planning to build targeted websites for each region. This will offer more data on how to proceed on next steps.
The numbers are here to prove that cross-border eCommerce is on a steady rise.
According to Statista, whereas 2015 showed a 15% cross-border eCommerce share, in 2022, it seems to have risen to 22%.
The numbers indicate one thing clearly - for eCommerce expansion, you’ll need a sturdy cross-border strategy.
Here are some pointers you’ll need to remember while tweaking your brand strategy for each new region:
An important thing to remember while creating a cross-border eCommerce strategy is that prices, laws, regulations, cultural tastes andbuying behavior would differ across regions.
So what you’ll essentially need is a larger blueprint of a brand-based strategy backed by versions for each region informed by trends revealed by data, cultural
insights, eCommerce adoption and how the category is doing in that region (based on what competitor data throws up).
While incorporating the elements for a larger brand-based cross border strategy, here are a few considerations that can help:
Once your larger brand strategy is in place, you may want to narrow down to a specific and actionable strategy for each region.
Make sure to find the answers to the following when you go about that process:
Hire an industry insider from the region you’re trying to expand to, to offer more insights and provide guidance. Alternatively, look at existing collaborators and partners who can potentially take on this role.
How well your brand and its products come across to potential cross-border buying audiences, is fundamental to your overall success.
And this is why you will need to put time and work into strengthening your brand personality and consequent messaging.
You may want to equally prioritize the way you bring out the uniqueness of your products.
Obviously, the limitations in creating a more localized branding strategy are fewer.
In trying to strengthen the way your brand comes across to a cross-border audience you’ll have to look at several factors such as customs, values, preferences and familiarity with your product & category.
To sharpen the central messaging around your brand, consider how you’ll accomplish the following while entering a new region:
Leverage your brand to build communities in foreign markets is often an early key to later success. (Sephora, the beauty brand, has taken this approach consistently across the countries it has launched.)
Looking for a breakthrough in the way you do eCommerce marketing? Read eCommerce marketing strategy: 12 questions founders should ask themselves
Cultural habits and patterns may superficially seem only collective in nature.
In reality, they run deep for the individual and often influence how their purchasing behavior is shaped.
This is why for a brand that’s attempting to attract customers across borders, cultural awareness is so significant.
Here are a few questions to consider as you try aligning your eCommerce business to a region’s culture-driven nuances:
First launch in a particular city within a country and then start spreading out. This will give you time to ramp up based on cultural quirks and gaps.
From the way everyday eCommerce business gets done to how deliveries are fulfilled and laws are established, every region has a different set of challenges.
And when a cross-border business is looking to expand, these challenges can arise unexpectedly.
Unless of course a business prepares for these contingencies.
Let’s take a look at the main areas in which region-specific challenges occur; and questions you may need to consider to negotiate them.
- Can your current browser-based translator or translation software- in-use support the language of the region you plan to expand to?
- How would you look at translating your business content for new audiences? Would it make sense to start with only the most relevant content and then take a phased approach?
- Would you consider machine translation tools or translation management technology? (the latter combines human translation with automation of non-linguistic aspects)
- Would taking a phased approach to translation be more strategic? (since it’s eCommerce, you may want to translate your transaction-related pages first as well as pages that help establishing trust in the business)
- What is the nature of privacy legislation in the region(s) you’re intending to move your business into?
- What are the associated laws and regulations around cybercrime in those regions
- What kinds of regulations exist around consumer protection?
- What are the existing laws around electronic commerce?
- What provisions exist for cross-border eCommerce in trade agreements specific to those regions?
- How much control do your shipping partners have over your delivery fulfillment?
- Do you have enough carrier options to compare and come to a decision?
- What kind of delivery method mix would work for a specific region as compared to another?
- What warehousing options do you have if you don’t want to maintain separate warehouses in the newly expanded locations?
Setting up a trustworthy system of vendors and partners can help you penetrate non-regional markets despite obvious roadblocks.
Deciding how to price your products in a new region you expand to can be considerably difficult.
On an external note, you’ll have to keep an eye on cultural idiosyncrasies, compliance issues, currency ups and downs and much more.
For example, Japan has high internet penetration, much of the population is influenced by buying trends and most people also have decent buying power.
However, COVID-19 made it imperative for many brands to go online if they wanted to survive and Japan’s overall eCommerce spending increased.
The elderly population especially was seen spending a lot more, as was proved by the credit card usage habits of 10 million credit card holders.
On the internal side, you’ll have to strike an alignment with your own company goals, values, vision and brand positioning.
For example, if you’re building up a product that’s not mass-market produced, it’ll be justified for you to price it at a premium.
It’s likely that every region will demand a different pricing strategy, whether it is penetration pricing, value pricing or psychological pricing.
For example, if you’re expanding to a market that already has some exposure to sustainable products, then it’d make sense to apply value-based pricing to your own sustainable brand.
No matter which strategy you ultimately employ, here are a few questions to ask while you navigate this tricky subject:
No matter which strategy you adopt, align your prices across channels. Seeing price variations across channels can create distrust in early potential buyers.
The repeatable steps you take to help your cross-border customers take notice of your brand and products, are vital.
This will decide your bottom line and profits over a period of time.
While customer acquisition is essentially tricky in any market, in a cross-border context, it is even more so.
The idea is to pick those channels that’ll give quick dividends - you can always expand to other channels as you go along.
Here are some questions you would want to ask while figuring out your customer acquisition strategy in foreign markets.
While market penetration and customer attention are important aspects to focus on, don’t forget product development and innovation.
We think you'll find this really relevant: The Founder's Guide to Customer Journey Map (eCommerce)
While entering an away from homeground region, it can be tempting to do the selling all on your own.
However, it might be challenging to get a foothold with customers - because for all practical purposes, they won’t know about your brand and trust could become an issue even if you do everything right (including marketing).
One way out is to choose a suitable international eCommerce marketplace to work with, in the regions you’re choosing to expand in.
Even if your long-term plan is to do most of the transactional heavy-lifting through your eCommerce website, first steps with a well-known eCommerce marketplace can be helpful.
Find a marketplace that highlights your product category and also has a good run with customer loyalty. Look for features like easy setup, customizable listing options and excellent seller services.
When International Post Corporation did a survey across 40 countries, they found almost one-third of the respondents had shopped more from international retailers in 2020.
If that’s not enough, 51% of them also said that they were planning to increase their cross-border purchases in the next few years.
This is significant in many different ways, and one of them is what a business can offer to their international or cross-border customers.
At Convertcart, we’ve seen it’s essential for businesses to start creating experiences beyond a great website.
One way to do this is to start thinking along the lines of omnichannel.
Here are a bunch of questions that’ll help you foster your CX efforts beyond your eCommerce website.
The website is just one piece of the puzzle. Figure out how you can create heightened experiences through emails, offers, returns and brand collaborations.
Do read: 20 Powerful FOMO Marketing Ideas for eCommerce
Familiarity is a big consideration when it comes to cross-border customers relying on a new brand.
And as basic as it may seem, language brings a sense of familiarity instantly.
No matter how good your brand is and how authentic your product offerings are, potential customers are likely to avoid buying if they don’t find you transacting in their chosen language.
Here are a few questions you may want to keep in mind while toying with the idea of translations while you expand:
Pay special attention to site navigation, product descriptions and return/refund policies. A cross-border audience would expect these to be translated into their language.
The minimum viable product approach can lessen the impact of challenges on your new business.
By now, the world has seen a number of well-established global brands emerge from first being MVPs (think Amazon, think Groupon).
When you’re trying to test cross-border markets, this approach can help you derive data, insights and early adopters without the need for a huge budget. Here are some questions to consider:
Focus on the prototype phase to test out assumptions and biases before you actually look at launching the MVP.
Apart from a great brand and great product, eCommerce success in a region away from your home ground depends on incentives.
The more you incentivize purchases for early adopters, the more they are likely to return for purchases AND talk about your business.
Here are a few aspects to consider while deciding on incentives:
Every region’s buying behavior is different. When you align your incentives with a specific buying behavior, sales are bound to move up. For example, if you know your cross-border audience uses social media frequently to shop, you may want to make more of your shoppable posts carry spot discounts across those channels.
Mobile commerce is on an unprecedented rise and the numbers are telling.
According to Salecycle, online traffic for global eCommerce on mobile seems to be 2.47 times higher than on desktop.
Many top brands like Walmart that have a considerable share in eCommerce, are seeing the value of making the mobile experience more enriching. For a brand that’s moving into new regions, the following considerations may be helpful:
Using a content integration tool that looks into analytics, translations and personalization can heighten the global mobile commerce experience.
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Many eCommerce businesses think a plethora of payment options and methods is what draws customers in.
The reality is that in newer regions where a brand has not been a player so far, potential customers are more interested in knowing you can offer them trusted payment methods.
Here are some questions to ask while you’re negotiating this topic.
Partner with expert payment providers who already have a view of the markets you’re planning to set foot on.
The ideal scenario is where a cross-border shopper decides to convert, receives their product and feels fulfilled with it.
However, just like this isn’t true with every domestic sale, it isn’t the case with many international sales too.
If you’re deciding to expand your eCommerce business to cross-border locations, asking the following questions on post-sales issues might help.
Focus on providing timely notifications to relay order status, status around exchanges and returns and available customer support options.
Worried about eCommerce returns? Read Reduce eCommerce Returns with Intelligent UX (+ Smart Handling ideas)