How to start your first cross-border online business
By making good use of online tools, e-tailers can find out what appeals to shoppers, and better tailor their services and product offerings to meet expectations.
Beyond just offering low price points, e-tailers need to define more unique competitive advantages when selling cross-border.
Finding a trustworthy logistic provider allows businesses to provide substantial value to shoppers.
In the past, whenever a shopper is unable to find a desired item or deal in one store, they would simply go look in another. With the rise of e-commerce, this process is easier for shoppers, because they now have thousands of web stores to choose, compare and buy from.
Happily for businesses, the opposite also rings true. Even the smallest enterprises can reach the millions that come online to hop and shop, thus profiting from the booming cross-border e-commerce market which analysts expect to grow to US$900 billion by 2020. That’s twice as fast as domestic e-commerce in even the most energetic countries, according to the DHL 21st Century Spice Trade Report.
Convincing shoppers to purchase from you, however, requires a more holistic approach than simply keeping prices low. In a global market where thousands of e-tailers vie for customers’ attention, steep discounts and attractive storefronts only stand out for so long before they are outdone by competitors. Only businesses with an excellent understanding of consumer purchasing habits will be able to enjoy a competitive advantage and flourish.
“International shoppers desire a local, authentic product. Strong evidence shows that they spend significantly more than local ones,” says Yasmin Aladad Khan, Executive Vice President of Commercial for Asia Pacific and Managing Director of Emerging Markets, DHL Express. “E-commerce has now leveled the playing field so there is more to gain if businesses tap into overseas markets. With the right digital access, e-tailers can rely on big data to get real-time market trends and react fast to the cross-border business opportunities.”
Know what will sell well
Placing your entire inventory online will not guarantee sales unless you carry items that people want. Identifying what sells well and what does not is the crux of a successful e-commerce business, and e-tailers need to monitor the pulse of what is trending in their retailing fields.
Social media is great for anticipating upcoming trends, such as the recent explosive popularity of fidget spinners, while a good grasp of Google Trends can clue entrepreneurs into the most popular product searches, or help them identify problems that their products can potentially solve. Online tools such as SimilarWeb can be used to find competitors with unfulfilled demand due to lack of stock, which are opportunities ripe for the taking.
Knowing how popular their products are, is paramount for businesses seeking to retain the exclusivity and image of their brand. Overwhelming demand for Boobie Bears surfaced through a social media post by a Chinese celebrity, sent its owners into a production frenzy, and spawned a slew of counterfeits in the process. By staying up-to-date with shifting market trends and capitalizing on their more unique offerings, businesses can benefit from rising demand or create their own opportunities where others may fail to tread.
“In e-commerce, consumer sentiments change quickly so responsiveness can make all the difference for volumes and profits,” says Khan. “By integrating your website with your logistics provider’s systems, your shipping process is streamlined in a few clicks and you can fulfill orders quickly without relying on too much extra manpower. In addition, you can also provide a good customer experience by displaying real time tracking information."
Sometimes, shopper priorities will run counter to what we might otherwise assume.
Understand your markets
Knowing who you are selling to is equally important. Understanding the expectations of different regional markets will help sellers validate destinations that play well to their strengths, while identifying opportunities or addressing possible weaknesses in their local go-to-market strategies.
There is a wide spectrum of expectations from shoppers when they buy from abroad, but the data becomes even more conclusive when you break it down by markets. The 21st Century Spice Trade report from DHL found that shoppers in Japan, Germany and the UK look for a wide range of products, while those from Russia go for the best prices available. Sometimes, those shopper priorities will run counter to what we might otherwise assume: consumers in China and India are typically thought to be highly price-sensitive, but research found that they are especially likely to prioritize quality of products cost.
Knowing these intricacies of the different markets can help small businesses devise a better go-to-market strategy, and make more informed decisions when expanding.
Make sure you can deliver
When buying online, shoppers typically make one final decision: how they want their items to be shipped. Varied cross-border shipping options would appeal to the average shopper, while a lack of choice often results in abandoned shopping carts. Premium shipping solutions, such as time definite, secure and flexible delivery options are among the requirements that online shoppers have come to expect from e-tailers.
Enterprising e-tailers can use express cross-border shipping solutions to move smaller volumes of product as they gauge the interest of new markets, especially remote countries. Doing so can actually act as an accelerator for their expansionary efforts, as well as reduce concerns or skepticism in new markets: 84% of consumers want to know the name of the parcel provider when they make a purchase. This therefore suggests that a trusted global brand can increase customers’ confidence in the purchase and may help win them over to complete that critical first order.
Choosing the right logistics partner experienced in cross-border transactions with different destination countries is essential for businesses seeking to probe new markets. Engaging the services of a well-known logistics partner is also an excellent way to instill and reinforce customer trust at that final stage when they hit the “purchase” button.
A trustworthy delivery experience can overcome most, if not all of the hesitation that consumers may feel when ordering online from overseas. The closer you can get to your customers’ needs and expectations, the stronger your relationship and sales will be – no matter the physical distance.