The Internet is the global marketplace – well, not quite yet
I attended a seminar last week and I was astounded by a statistic – make sure you’re sat down for this one….
Only 10% of UK web-sites sell internationally.
Wow, I thought, I cannot believe that it is that low. But then I started thinking about what would stop a company from selling abroad. There are a number of reasons…not every service is applicable abroad, for example legal or accountancy, and a number of websites are for businesses with very specific geographical catchment areas, e.g. hairdressers.
However, a business that sells physical goods via the internet is likely to be able to sell these abroad – but something about the prospect of international commerce is putting them off. I have identified some of the key challenges to international ecommerce and ways to navigate them to turn them into opportunities:
Localism – social and cultural challenges are probably the biggest and most complex factors to understand. Spending time with like-minded businesses who are based in your target country will help you understand what the cultural differences are that can make your site attractive to international consumers. Where will you find these contacts? You’re probably already connected to them – Facebook, Twitter, LinkedIn, all over the place!
Seasonality – if you sell, say, clothes, then you will need to turn over your summer collections before the weather starts getting cold in the UK. However, if you also sell to Australia, then at the same time of year, they will be looking for summer collections, so seasonality can flatten the peaks and troughs of different collections. This is a huge opportunity for ecommerce.
Brand awareness and customer confidence – traditionally, brand awareness was conducted within international borders, with only a few massive organisations able to achieve this abroad, and at great expense. But the web has changed everything. Social media allows you to communicate directly with international audiences, and (assuming similar cultures and language) the messages that you send out to engage your UK customers will also apply elsewhere. Links with local organisations (see point one!) will help you further increase local brand awareness, and reviews from consumers in that country will help build consumer confidence in your proposition.
Payment – naturally, people will want to pay in their local currency, so this option should be available on your website. Also, make very clear what your delivery charges are for international shipping. If this is only made available at the check-out stage, your conversion rate will be low – sophisticated web users in 2012 will not go hunting for your costs, so be transparent and show them before check-out. Also understand the local attitudes to delivery costs – for example, in Germany, postage is virtually never paid for by the consumer, it is seen as a cost to the business.
Legal – there are a wide variety of legal areas that you need to be familiar with before you embark on international ecommerce – contract law, employment law, accountancy and tax law are all areas which will need your fullest attention before you embark.
So, is it really worth it? There are a lot of challenges to international ecommerce, but the rewards can be very significant. Imagine that by doing some research, linking with some organisations on social media and making some small adjustments to your website, you could increase your web traffic, and as such, your sales – and this is quite apart from any positive impact to your conversion rate!
What do you think? Is your organisation an international retailer, or is the prospect too daunting? Let me know!