Let’s look at the five key reasons why SME e-commerce retailers are set for global success in the coming months and years.

Competitive shipping and warehousing

The growth in e-commerce means that it’s never been easier to source competitive shipping rates globally, along with reasonably priced warehouses to store products for fulfilment.

Looking at shipping, there are a plethora of global and local courier services all competing to offer the best prices, and service at speed for e-commerce businesses. Most are geared to expediting products fast in the e-commerce age and are able, dependent on the location of your warehouses, to offer same day or next day delivery.

Using a courier service that can deliver products in the shortest time scale will help guarantee retailers deliver a strong customer experience and stand out amongst the competition. To ensure the best price for the shipping service remember that volume is key – delivery costs come down the more product is sold and delivered. This means it’s very important to accurately predict the volume of orders that will be delivered as this will help you to negotiate the best price with the courier you choose.

Warehouses too are increasingly competing for retailers and offering competitive pricing in an age where 60% of warehouse space is used by retailers, up from about a third a decade ago. However, what those in e-commerce need to bear in mind is the urban logistics facilities that offer ‘the last mile’ in the fulfilment process are seeing increased costs due to their growing popularity from retailers in locations of restricted space.

Those retailers who don’t want to get involved in the warehouse and fulfilment process can easily outsource it all to Amazon. The service, Fulfilment by Amazon (FBA), enables them to place their inventory in the Amazon fulfilment centre and sees Amazon handle the shipping, returns and customer service. Amazon also offers this facility for products sold directly via the brand’s own website, to make the whole process as easy as possible.

Growth in content management systems (CMS)

Once retailers have built their website on an e-commerce platform like Magento, WordPress or Shopify, the CMS technology built into these platforms enables them to easily update their website with images and text, without needing to have any knowledge of HTML, CSS or other coding. Gone are the days of relying on a web developer to make regular site changes, saving both time and money.

CMS also enables websites across multiple countries and regions to be updated via one CMS – making the whole process quick and easy.

CMS is also very convenient for busy retailers on the go. It’s possible to login to the back-end of your website from anywhere and to make changes. All you need is a computer, tablet, or mobile device and an internet connection.

Furthermore, via CMS general updates and support requirements that maintain the well-being of your site can be conducted almost instantly, with few clicks of a button.

Increased ease in implementing transcreation

At first glance, it’s not easy for retailers to create engaging and emotive copy targeted at multiple audiences, all speaking different languages, with different cultural beliefs and nuances.

In order for your e-commerce business to succeed in overseas markets, you need to ensure that you’re using the right language, tone of voice and that your content is written in a style that will engage your target audience.

This is not a simple case of translating copy from one market into another. You need to understand the cultural nuances of the target region and adapt your message to your audience within it. This is the only way you can effectively connect with audiences on an emotional level and is why retailers must use transcreation services over simple translation.

Luckily for retailers, there are many suppliers in the transcreation space who can help identify your target audience, understand their habits and motivations and craft tailored messages that resonate with them and are consistent with your brand style and tone of voice, regardless of the region or language you’re targeting.

Greater availability of content delivery networks

Websites live and die based on their page speed and overall website performance. It’s essential that they load up very quickly and offer speedy functionality.

The issue is the further away someone is from the server which is hosting your website, the greater the delay that person experiences in accessing your site. Therefore, if your website is hosted on a server in London and someone accesses your site from Australia, they will experience an annoying delay in the site load time and functionality.

The solution to this problem is to use a content delivery network (CDN) which is a network of geographically distributed servers which caches your static content near the location of your visitors.  They provide the fastest way to deliver content from your website application to people based anywhere in the world.

One of the most popular, and the one I recommend, is CloudFlare which routes your traffic through its global network. It automatically optimises the delivery of your webpages to achieve the fastest load times and help to deliver the best performance possible.

Plenty of channel partners offering instant global reach

It’s reasonably straightforward to integrate an existing e-commerce catalogue with the likes of Amazon or eBay, and gain access to their huge global audience, therefore helping to boost sales. In fact, you can set-up on most channel partners in the morning and start selling on their platforms in the afternoon.

Also, retailers shouldn’t discount partnering with the channel partner leaders in the markets they want to operate in. There’s Cdiscount in France, Real.de in Germany, Rakuten in Japan and Alibaba in much of Asia - an e-commerce site that’s now increasingly global. Both Amazon and eBay are great options if you are targeting consumers in North America and Europe.

If your product offering is a bit more niche it’s important to look at appearing on potential marketplaces that sell niche products, such as Etsy for handmade products and crafts and Bonanza for unique items.

By offering a variety of retail options for your customers to buy from, you increase the convenience and ease of purchase, which in turn, boosts profit. Simply put, having a number of buying points gives you more tools with which to make a sale. And by selling your products through other online retailers means you’re not dependent on any single revenue stream – such as your own.

Ideally, any SME retailer that is focused on global e-commerce growth should look to source an e-commerce agency with a track record in driving worldwide sales for their clients. They will help them take advantage of the opportunities currently available and set them on course for global success in 2019 and beyond.

Author: Leo Matthews, Director at Xigen

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According to Damian Ryan, a partner at UK accountancy firm Moore Stephens, which conducted the survey, "marketers are seeking to build in-house strength and are set to spend more on digital marketing to remain competitive. Our research finds that this budget is coming from media spend and will have a resounding impact on the value of media-centric agencies.” The Moore Stephens survey, conducted with advertising and media consultancy WARC, covered 800 companies in North America, the Asia-Pacific, and Europe.

It found that brands in Britain and North America spent 23 percent of their budgets on digital marketing, up from 16 percent a year ago. And 63 percent of American technology budgets were spent in-house, compared with 44 percent last year. Tough European data protection rules that took effect in May, as well as concerns over the data practices of search giant Google and social network Facebook - the two biggest online advertising platforms - have led several players in the ad industry to merge or retrench. The emergence of platform companies that offer a one-stop shop for marketers is another trend to watch, Ryan said to Reuters, highlighting Adobe Systems’ acquisition in May of e-commerce company Magento for $1.7 billion.

Ryan concludes that “Fundamentally, brands don’t like to trust agencies with data. The clear trend shows that brands are seeking to take control over marketing technology. Against that, we can see that, at the upper end where brands are spending more, they are still working with agencies.”

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“China continues to have the greatest impact on the growing shipping market,” said Lila Snyder, President, Commerce Services at Pitney Bowes. “Globally, e-commerce continues to drive growth in all regions. Global e-commerce giants continue to raise the bar, resetting customer expectations when it comes to shipping. As retailers and marketplaces look to cross-border commerce to drive growth, carriers must create efficient, seamless routes to market.” What can be seen is that China’s Parcel Volume triples the United States’: China (40.1 billion), the United States (11.9 billion). Japan (9.6 billion) completes the top three countries for parcel shipping volume in 2017. China’s parcel shipments represent 53% of the total shipments in the Pitney Bowes Parcel Shipping Index.

The United States ranks highest in parcel shipping revenue at $107 billion, generating 38 percent of the total revenue of the 13 countries. China ($73 billion) and Japan ($25 billion) follow.

Pitney Bowes Parcel Shipping Index also predicted that global shipping volume will surpass 100 billion parcels in 2020 in aggregate across the 13 countries reviewed: Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Norway, Sweden, the UK and the USA.

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Date:                Wed 3 May 2017

Time:                2pm – 3pm GMT

 Speakers:         Lionbridge Subject Matter Experts

Aoife McIlraith, Director of Global Search and Marketing

Brendan Walsh, EMEA SEO and SEM Manager

In this webinar, you will:

1. Understand why geo-targeting is important to your customers, conversion rates and your online success
2. Learn how to prevent undue competition with your own websites, maximise indexed pages, and eliminate duplicate content errors
3. Discover real world examples of the ‘dos & don’ts’ involved with international SEO

Register here

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■ Cross-border shoppers in developing markets are increasing significantly. Forrester’s survey data show an increase in online adults shopping online across borders in many European and Asia Pacific countries. Online cross-border buyer growth in Latin America, Asia Pacific, Africa, and the Middle East will see double-digit compound annual growth over the next five years — significantly more than the growth in Europe and North America.

■ Marketplaces are increasing their share of cross-border sales. Cross-border shoppers prefer to use global marketplaces when they shop abroad.  Alibaba, which holds half of the online B2C market in China, increased its share of online sales from outside China to 7% in 2015.  In Japan, online marketplace Rakuten reported 41% growth in cross-border sales in 2015, more than twice the growth of the domestic eCommerce market.  In Germany, France, and the UK, more than half of cross-border buyers buy from Amazon and eBay.  

■ Cross-border shopping is becoming easier and faster. Free-trade zones (FTZs) in China lower taxes on imported goods. Bonded warehouses within FTZs allow retailers to ship goods across borders in anticipation of a sale, reducing the time to deliver to the consumer to just two to three days.  As cross-border shopping develops, cross-border buyers look to reduce shipping costs and delivery times by shopping closer to home. Forrester’s survey data shows for example that 38% of online cross-border buyers in South Korea bought from other Asian countries in 2015 up from 35% in 2014.

Price, Choice, And Authenticity Drive Cross-Border Shoppers
Consumers shop across borders to find cheaper goods, goods that are not available in their domestic market, or to shop at international retailers they can trust.  Although cross-border shopping often implies longer delivery times and higher delivery costs than for domestic purchases, the price (including shipping), choice, and authenticity of products drives consumers to shop across borders:

■ Price. A country's cross-border shopping correlates with the country's average price of goods. The higher a country's price level index, the higher the opportunity for online shoppers to find retail items cheaper outside their domestic market.  For example, domestic goods are expensive in the Nordic region and in Australia, which explains why more than 70% of Nordic shoppers and 80% of Australian online shoppers have purchased from abroad.

■ Choice. Larger competitive domestic online markets, such as Germany, France, the UK, and the US, inhibit the need for shoppers to buy goods across borders.  Online buyers in countries with small eCommerce markets, such as Russia, Mexico, and India, are more likely to shop across borders to find a better choice of goods. Canada is also a small online market; it’s less than a 10th of the size of the US. Given the convenience of having a large online market on its doorstep, it is not surprising that one-third of Canadian online retail sales in come from across the US border.

■ Authenticity. Product quality and authenticity are also important factors for cross-border shoppers, especially in India and China.  Chinese shoppers favour foreign brands over domestic brands notably for luxury goods, baby food, and beauty products.  Alibaba has recently undergone criticism for not managing counterfeit goods on its websites; this has hurt its reputation and further reinforced the need for online shoppers to buy across borders from recognized overseas websites to guarantee the authenticity of their purchases.

Retailers Must Embrace The Opportunities Of Cross-Border Shopping
Shopping across borders not only helps retailers understand new consumer needs, but it also helps logistics companies develop more efficient ways to deliver goods across the globe while improving the customer experience of the online cross-border buyer. Cross-border shopping helps retailers:

■ Develop a more integrated cross-border delivery network. Shipping costs are the most common reason in Europe for not completing an online purchase.  With half of all cross-border retail taking place between regions, online retailers are increasingly investing in global logistics solutions for efficient cross-border delivery. Both Alibaba and Amazon have made major investments in global supply chain infrastructure to facilitate cross-border retail.  Amazon is expanding its logistics operations in China to reduce logistics costs and make it easier for Chinese merchants and manufacturers to transport their goods to major hubs around the world.

■ Use online habits to drive cross-border habits. As in domestic online retail, apparel and accessories is the most popular cross-border category; one-fifth of the EU-5's online cross-border shoppers report that they've recently ordered clothes/accessories from a website outside their own country.  In Australia, which is a mature online cross-border market, the growth in cross-border commerce mirrors eCommerce growth.  Inhibitors to cross-border trade are similar to those associated with online shopping — whether that’s web interfaces that don’t adapt to the shopper’s preferred device, the inability to deliver content in their preferred language with their preferred payment and delivery options, or the lack of credibility and authenticity of the goods bought.

■ Identify gaps and opportunities within domestic online markets. Understanding the categories that cross-border shoppers buy helps identify gaps and opportunities within domestic markets. For example, it can highlight different prices for the same goods in different markets or how domestic markets don’t meet online shopper needs.  In 2015 only 17% of French online cosmetics buyers bought beauty products across borders, compared with 34% of their Italian peers.  Given that France is a key provider of premium cosmetics products to Europe, it is not surprising that French online beauty buyers are less likely to shop across borders than the Italians.  

This report uses data from Forrester’s Global Online Cross-Border Retail Forecast, 2016 To 2021 and from Forrester’s Consumer Technographics® surveys to understand online cross-border shopper behaviour. Michael O’Grady is a Senior Forecast Analyst at Forrester based in London.

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