Should Online Retailers Expand Into International Markets?
Online retail continues to grow at a pace that offline retail can only envy, with ecommerce sales expected to hit £182 billion in 2016 (up 16.7% from 2015 figures).
That’s an impressive rate of growth, but this isn’t distributed evenly across the world. In mature markets, such as Europe, the US and Japan, growth is slowing. Whereas Latin America and Asia Pacific are witnessing growth rates around 17%, compared to the US and Europe at 10% and 13%, respectively.
It’s also worth highlighting the fact that consumers in emerging markets are more mobile-savvy. They are more likely to search and buy through smartphones than customers in developed economies. Social networks have made the world seem smaller, potentially opening up vast new markets to small businesses that weren’t very accessible ten years ago.
According to Deloitte, customers in emerging markets are eager to buy products from abroad. In Brazil, 81% of consumers want to buy from international websites, followed by Indonesia (77%), Thailand (74%), China (69%) and Spain (66%).
It has never been easier to win a presence in foreign markets, but there are several things to consider first.
Getting Started As An International Merchant
Entering a new market can’t be done without investing in localised versions of websites, along with mobile and browser versions that load as fast abroad as they do at home. Local customers will turn away from those brands that clearly don’t care about serving international markets as effectively as they do at home.
Ensure the copy is translated by a native speaker. Google translate and software can’t make up for the subtleties in words and phrases that a writer would notice.
Next, work with UK Trade & Industry (UKTI) who are happy to help arrange phone calls with consulates, along with other forms of support (starting with their Passport to Export scheme) that can make it easier to understand laws and taxes that may apply when selling products in international markets.
UKTI trade advisors are also local experts, able to advise how easy, or not, to sell your products might be in a particular country. They are often better able to indicate the strength of an economy since they get data from local sources that isn’t always accessible in the UK. It may also be necessary, depending on taxes and local laws, to set up a subsidiary, if you are planning on establishing a significant market presence in a particular region or country.
Finally, ensure your payment systems are configured for local currencies and international exchange rates. In emerging market regions, such as South-East Asia & China, customers mainly shop through mobile stores. Checkouts and payment forms should be simple and short, to ensure you aren’t driving the customer away through a poor user-experience. Give them an online retail experience they want to tell others about.
For more information on getting started with cross-border trade in the EU, read this post.