So you’re ready to take on the world. Global expansion tickles away at the mind of many business owners because, well, the nature of the internet today means you can reach even more customers in all sorts of far-flung corners of the world. Why wouldn’t you want to help them out with your product?
Add to this the incredibly speedy rate at which technology is developing, and you have all the tools you need to branch out into new markets.
But, while this new interconnected, digital world has helped eCommerce businesses sell their products in new and exciting places, the foundations of running an online store remain the same. And, for many online merchants, there are still plenty of simple yet critical mistakes they are making on a daily basis when it comes to selling their products internationally. Let’s dive in.
1. Obscuring the Total Cost
The change in currencies and independent VAT laws in different countries means you’ll probably have to tack on additional costs at checkout for international customers. But, for buyers in other parts of the world, there’s nothing worse than arriving at checkout, excited to buy, and then being hit with extra costs. And, when you consider that 19% of consumers don’t trust foreign shops, it’s a sensitive subject that needs tackling head on if you want to keep your international customers happy.
To overcome this problem, you can do one of two things:
Show all costs upfront
Ideally, you don’t want to keep anything from the customer. Trust is built through transparency, and being open about how much VAT and additional costs will be added at checkout can make the difference between keeping and retaining a loyal customer or losing them for good. Instead of sneakily adding on local costs accrued at the end of the purchasing process, try adding it on at the start so everyone knows what to expect and when.
Create a localized shopping experience
Alternatively, you can make the checkout process localized to each market you’re expanding into. With 14% of consumers concerned about paying online in a foreign currency, it makes sense to provide a payment solution that fits their needs instead. To do this, you can integrate a system where the consumer can pay in their preferred currency, in their preferred language, and via their preferred payment method. This will ensure the checkout stage isn’t a nasty sticking point for potential buyers.
2. Not Aligning Your Store to Each Market
Global expansion isn’t a case of allowing customers from different countries to access your products. Instead, it involves a lot more foresight and research than that – especially if you actually want to make sales. One big mistake a lot of eCommerce stores make is copying and pasting content from one site to another, without any thought about whether that content will still strike a chord with the target audience.
There are two main reasons why not aligning your store to each market doesn’t work:
- You won’t appeal to your localized market, because you haven’t taken the time to figure out what they’re interested in and why they’d want to buy your product
- You won’t rank well on Google in the region you want to reach because you’re not targeting your content towards it
When setting up your site to reach multiple markets, it’s worth taking the time to double check any language and media you’re integrating to see if it aligns with the interests of the people you’re targeting.
3. Ignoring Fraud
Selling in new markets automatically increases the risk of fraud because there are more opportunities for people to hack into the system. Thankfully, you can easily prepare your site to prevent fraud. If you’re providing international checkout on your site, there are two key methods you can implement to prevent the heightened risk of fraud.
- Firstly, you can install a fraud suite through the eCommerce platform provider you use
- Alternatively, you can leverage a 3PL to manage fraud
In addition to this, there are numerous payment solutions that will help you keep your eCommerce business safe wherever you’re selling in the world.
Many of the concerns online shoppers have about online shopping revolve around fraud. Security and the safety of your customer’s information should be a high priority, regardless of where they live.
4. Trying to Do Too Much Too Soon
Expanding into different markets is an exciting prospect, but that excitement can overtake rational eCommerce business thinking to the point that it’s detrimental to your brand. Global expansion takes time and won’t happen overnight, so trying to push things too fast can have a negative impact.
Want to be realistic?
Experts reckon that launching into two or three new markets per year is a good place to start. That way, you can thoroughly research each market and make sure you’re aligning your products, content, and payment solutions to each and every one.
It’s a good idea to launch into a single market first, so you can test the waters and experiment with different strategies to see what works and what doesn’t. You can then replicate this blueprint in other markets, which will not only help you streamline the process, but give you a good benchmark for measuring your success in each market.
5. Not Doing Enough Research
Global expansion isn’t a case of hitting and hoping – that’s a quick and easy path to failure. The eCommerce world is complicated, with different spending and growth volumes in every single country. What works in one place won’t work in another and vice versa. Take China, for example, which generates considerably more online sales than the US. This piece of information might have you gunning to expand into the Chinese market pronto, but that doesn’t mean your product will sell well there.
Often, your exact product or something very similar will already be on sale in that market and, nine times out of ten, it will be at a cheaper price point.
It might be tempting to carve your way into the market by offering your product for an even lower price, but remember you need to make a profit.
Slashing your margins to compete in what might be a saturated market isn’t a viable long term strategy, so it’s vital that you research what products are already being sold in that market, what their price point is, and how yours compares.
On the flipside, you might find that the market you want to expand into doesn’t have any products like yours on the market.
“Great!” You think, with dollar signs flashing before your eyes. Surely if there’s no competition, you’re going to rise to the top quickly? Not necessarily.
A lack of products similar to yours on the market might mean that there’s no demand for it in that particular country. So, as well as making sure your product isn’t going to be driven into the ground with penny-pinching prices, you also want to check that there are actually people in that market that want or need your product.
Cross-Border eCommerce is the Future
While it might come with a lot of things to think about, cross-border eCommerce is a multibillion dollar industry which is expected to grow by 8-12% in the next couple of years. Even if it’s not on your radar at the moment, it might well be in the future, and there’s no time like the present to start preparing.
According to BI Intelligence, global eCommerce is set to generate over $1 trillion in sales by 2021 – that’s an incredible number. With the constantly evolving nature of technology and the ability to integrate localized marketing on a global scale, selling overseas is becoming easier by the day.
But if you want to avoid falling at the first hurdle and make a success of your global eCommerce business, these key mistakes are the ones you need to be steering clear of.
If you don’t want to enter a race to the bottom with your product and want to keep your customers happy all over the world, you can:
- Be transparent about the inevitable additional costs at checkout
- Align your store to each and every market you expand into
- Keep fraud at bay by integrating a specialised system
- Expand slowly into one or two markets at a time to get a feel for each one
- Do your research so you know whether your product is in demand or not
Selling your product in different markets around the world might be the best thing you ever do.
So, are you ready to go global? Make sure you have all the basics in place by downloading our Ultimate Guide to Selling Your Products Globally.
Maik Bodden, Marketing Manager @ G2A PAY