Reports of eCommerce success throughout lockdown are now highlighting the need for cross-border international eCommerce. The market is expected to reach a value of $1 trillion in 2020 with 24% of eCommerce in Europe now reportedly cross-border.
And whilst many trends were abruptly halted as the Covid-19 disruption began to interfere with the day to day workings of business, the sale of online goods to different countries saw continual growth on a global scale with eShopWorld reporting a 109% year-on-year growth during the month of May which suggests that even during these difficult times, brands that are geographically diversified are in a stronger position. Amazingly, this comes at the same time as estimates that most economies would see falls of between 20-30% GDP in the second quarter of the year, according to OECD.
Throughout May, the list of countries showing high year-on-year growth is extensive to say the last. The statistics show the top performers to be Mexico: up 258%; Chile: up 242%; Singapore: up 214%; New Zealand: up 207%; Israel: up 206%; Ireland: up 199%; Russia: up 194%; Spain: up 165%; Canada: up 157%; and the United Kingdom: up 146%. Insights like this ultimately point to a global audience that is more engaged than ever with online shopping and are willing to use international eCommerce retailers to get the items or services they want.
Making Cross-border Commerce Work
To turn your business into a viable international eCommerce store requires an understanding of different audiences, and as part of this you must offer different methods of payment depending on the preferences of the country. Secure payment gateways are still a must but so is accommodating payment preferences as every country is different.
For example, card-based payments do not hold broad appeal in China where 86% of all consumers pay using digital wallets, such as Alipay or WeChat Pay. To tap into these markets that are looking to online more than ever you must adapt. This may involve partnering with local payment service providers or finding one which is most globally used with PayPal being the most sought-after method across the globe because it permits buyers to make transactions in their currency and boasts buyer protection policy.
But it is not simply enough to align with the most appropriate payment service providers. Businesses must also develop strategies for sending and receiving funds across borders, such as fraud and data security risks, exchange rate volatility and chargebacks. If this is not optimised, cross-border international eCommerce businesses have the potential to succumb to risks that can chip away at revenue.
Yet even in getting these factors optimised it is important to only onboard one country-specific store at a time can help you keep control of your brand. This allows evaluation of localised success if you’re successfully converting local buyers.
So Why Go International With Your eCommerce Business?
The most telling finding around cross-border international eCommerce is the fact it thrives in difficult economies, something anticipated to be on the horizon following Covid-19. In 2010 and 2011, the Greek eCommerce market had a steady growth of 40 to 50% despite the after-effects of the global financial crisis. The preference for online and international eCommerce shopping during this time is owed to consumers becoming more cost-conscious and going online to compare products to save money, according to the Empowering Consumers in E-Commerce report. This reasoning is reiterated by Invesp who state that 49% of US consumers shop abroad online due to costs.
Above this, opening your business up across borders, when done well, builds your brand recognition and increases your global reach with newfound engagement. The formula of combining these will likely reap increased revenue in a market predicted to continue to grow, especially in light of the above context.
Cloud.IQ has helped many retailers to drive revenue and create loyal customers internationally. Click here to find out more about how Cloud.IQ can enable you to move your business towards Cross-Border International eCommerce.