The Promise and Perils of Cross-Border E-CommercePeter Reville |
U.S. online sales growth is projected to be lower than the growth in developing markets, according to growth rate forecasts from Forrester Research. Countries such as India, China, Brazil, and Mexico are all around 20 percent or higher compared with 10 percent in the United States. Of course, 10 percent growth is pretty good—but 20 percent is even better. One of the reasons developing and emerging markets are growing faster is that Internet penetration in these markets is increasing at a much faster pace than in the developed world. What’s more, there is a growing demand for goods from the developed world.
What can retailers do? Go global! But this is much easier said than done.
There is so much to think about when embarking on a plan to take your retail site global. Accepting international orders takes a significant amount of preparation and planning, including the following:
Acceptance: Because of fraud concerns, many acquirers will not accept card numbers from certain countries.
Language: English is not the universal language and language barriers are a common reason consumers do not shop online outside of their country. A report by Forrester on multilingual websites reported that international visitors are more likely to explore a website and make a purchase if the website is in their native language. In China, 95 percent of online consumers indicated a greater comfort level with sites in their own language.
Tariffs, taxes and customs: These vary from country to country and even region to region within a country.
Delivery: Shipping infrastructure is an issue in the developing world; getting a package “the last mile” can be very challenging.
Localizing: Retailers cannot assume that what is acceptable in one country is acceptable in another. Along with language, shoppers need to see market-specific features and content.
So go global—but go slow. There is much to navigate before you have a successful global retailing site. But know this: Regardless of country, currency, or language, customers will gravitate to sites that give them what they want in the most convenient and comfortable manner.
Topics: Payments Strategy