How to Successfully Expand Cross-Border Shopping
BlogDicembre 28, 2022
Recently, cross-border ecommerce trends have seen governments worldwide adding restrictions to external sellers. The U.S. has a "Made in America" campaign looking to cut more than 18,000 taxes that different countries place on American exports to support local businesses. Meanwhile, the European Union centralized value-added tax (VAT) management, with Brexit making things even more complicated for foreign businesses to navigate.
Fortunately, cross-border online shopping is still a huge opportunity as market correction forces businesses to recalibrate their ecommerce strategies. A tumultuous past few years have changed social and technological habits, and we are now facing inflation and recession as productivity plummets. Different sectors in different localities will recover at different rates, which means you need to be prepared to expand your geographic footprint now rather than later. This means adopting a global ecommerce strategy that includes cross-border selling.
The pandemic gave everybody a chance to reset and evaluate their goals. Blauer USA, for example, is an Italian fashion brand that saw its first ecommerce success in Germany before expanding to the U.S., the U.K., and the European and Australian markets. Every season, it focuses on the most favorable market to double company revenue.
Blauer USA achieved this success by implementing the Merchant of Record model to sell internationally. With a Merchant of Record, Blauer USA could apply strategic consultancy according to each unique market and remain compliant when making decisions. With a Merchant of Record, Blauer USA's expansion was easier and allowed it to implement a geolocalization strategy, pricing adjustments, tax management, duties calculations, and translations for successful global results.
Fortunately, cross-border online shopping is still a huge opportunity as market correction forces businesses to recalibrate their ecommerce strategies. A tumultuous past few years have changed social and technological habits, and we are now facing inflation and recession as productivity plummets. Different sectors in different localities will recover at different rates, which means you need to be prepared to expand your geographic footprint now rather than later. This means adopting a global ecommerce strategy that includes cross-border selling.
Expanding in Economic Turmoil
The pandemic gave everybody a chance to reset and evaluate their goals. Blauer USA, for example, is an Italian fashion brand that saw its first ecommerce success in Germany before expanding to the U.S., the U.K., and the European and Australian markets. Every season, it focuses on the most favorable market to double company revenue.
Blauer USA achieved this success by implementing the Merchant of Record model to sell internationally. With a Merchant of Record, Blauer USA could apply strategic consultancy according to each unique market and remain compliant when making decisions. With a Merchant of Record, Blauer USA's expansion was easier and allowed it to implement a geolocalization strategy, pricing adjustments, tax management, duties calculations, and translations for successful global results.
Staying Ahead of Cross-Border Ecommerce Trends
Brands sell internationally to sell more. Some geographies are more attractive than others for different "local" reasons, such as:- A presence of strong partners.
- Market maturity.
- Regulatory ease.
- An absence of strong competitors.
- Addressable market size.
- Majority target customers.
- Closeness with company culture.
Entering new international markets is beneficial for growing revenue with new customer bases, but it can also be a strategic move to mitigate risk through different investments. Having different channels and geographies mitigates risks related to specific markets. It's not a rigid strategy based on a unique business model in a single or a few markets. Rather, opening relevant cross-border ecommerce markets grows your business with global revenue.
There are three key elements of a successful cross-border ecommerce market strategy:
1. Localize your efforts
Every country has its own habits, laws, and tools. Make sure you familiarize yourself with local preferred payment processes to increase conversion rates and save money. The more you can localize your strategy specific to the city or country you're working in, the better.
Bad customer experiences decrease trust and revenue. If you have too many steps between the customer and payment (such as unclear information or linking outside the website), you risk losing that customer forever. According to a Baymard Institute study, 69.57% of customers abandon online shopping carts for various reasons. The less friction there is in the process, the more likely your business is to succeed.
Above all else, risk mitigation is essential. Be sure legal information is correctly displayed and clear to customers, that footers and headers are in line with local regulations, and that 3DS and 2FA are part of the payment process. The more you open yourself for business, the more open you are to fraud, which could create a bad business problem.
Compliance is necessary to ensure your efforts are well-spent. There's no point in building your cross-border ecommerce strategy if it can't be sustained. If you can maintain these three tenets, your cross-border online shopping strategy should provide valuable new revenue opportunities.
Before you get started, you need the right plan in place. Fortunately, Go Global Ecommerce can help. Contact us today to learn more about cross-border ecommerce trends and how you can create a successful global ecommerce strategy.
2. Focus on the customer experience
Bad customer experiences decrease trust and revenue. If you have too many steps between the customer and payment (such as unclear information or linking outside the website), you risk losing that customer forever. According to a Baymard Institute study, 69.57% of customers abandon online shopping carts for various reasons. The less friction there is in the process, the more likely your business is to succeed.
3. Mitigate potential risks
Above all else, risk mitigation is essential. Be sure legal information is correctly displayed and clear to customers, that footers and headers are in line with local regulations, and that 3DS and 2FA are part of the payment process. The more you open yourself for business, the more open you are to fraud, which could create a bad business problem.
Compliance is necessary to ensure your efforts are well-spent. There's no point in building your cross-border ecommerce strategy if it can't be sustained. If you can maintain these three tenets, your cross-border online shopping strategy should provide valuable new revenue opportunities.
Get Started Today
The past few years have made it clear that the future of finance is global ecommerce, but it also halted the supply chain and forced governments worldwide to protect their local needs. In this new environment, opening a cross-border ecommerce market is both necessary and challenging. It's worth the effort, though, as it can mitigate risk while generating new revenue opportunities for your business.Before you get started, you need the right plan in place. Fortunately, Go Global Ecommerce can help. Contact us today to learn more about cross-border ecommerce trends and how you can create a successful global ecommerce strategy.
