When Are You Ready for Cross-Border E-commerce?

January 27, 2024 by
Frank Calviño

Perhaps the answer is "never".

By Jacco Bouw
Co-founder of Agency China

The question is a common one among companies eager to expand overseas, yet they hesitate, questioning if they are prepared to sell internationally. The allure is there, but it's quickly overshadowed by concerns: how and where should I market my products? How will I protect my intellectual property, and will I receive payment?

And after all that, what arrangements must be made for taxes? These concerns, while legitimate, should not hinder the development of a strategic plan and thorough preparation. It's wise to seek advice, but
wavering can be expensive.

Determining the next market is part of the research. Europe might be considered, but China may not be the first choice. However, there's much to learn from a market like China.

In China, our established social media channels are blocked by the 'Great Firewall'. There's no access to Twitter, Facebook, Instagram, or Google. Thus, any strategy dependent on these platforms is ineffective. China has its own social media networks, with features that far exceed those we're accustomed to.

Sales in China often occur through social commerce, a buzzword some companies experiment with. It's a cost-effective, direct alternative to traditional online advertising and a welcome addition to standard marketplaces. On standard marketplaces, you pay for visibility. The higher your product's placement on the page, the greater the likelihood of a sale.

Social commerce is leveraged by live streamers with millions of followers. A successful early sale in the livestream can boost the algorithm, broadening visibility. If traffic is low, it's possible to buy it.

Live streamers, often under 30 and commanding audiences in the millions, work with teams to curate and promote products. They're integral to brand success.

Next-level customer service is crucial, especially during live shows. For instance, we were recently penalised for responding to a query after 26.7 seconds — too slow for the Chinese platform's standards.

To drive higher conversions, entertainment is key. This could be a live stream recorded from a factory or warehouse or outside in a nice environment. Social commerce isn't just commerce; it's setting trends.

In the West, we do not have an app where everything is so linked together, and that is why we will not match the user experience here for the time being. In addition, China is also mobile only. Nevertheless, the trends abroad indicate which direction things are going, although not everything will be matched 1 to 1.

Ultimately, we find our own style, and it is very likely possible to achieve operational excellence with the support of AI. The trend of relevance for the right target group and entertainment to retain the buyer is a
logical progression from what is currently common and something that all platforms are working hard on.

This is the main thing that creates real engagement between customer and brand and is, therefore, the same all over the world.

Cross-border e-commerce is a non-linear journey that, despite its challenges, can fulfill an organization's ambitions. While ticking every box beforehand is ideal, it's often not realistic.

Jacco Bouw
Co-founder of Agency China

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