Basic Eight: Winning in Global Ecommerce

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Start selling and growing internationally online right now. The barriers to entry have been reduced considerably with cloud computing and the global ecommerce revolution. No matter your size, you can get going, and growing and compete now in foreign markets through localizing your site into numerous markets abroad. The growth opportunities abroad are immediate and significant if you tackle the eight immediate challenges.

Staging a global takeover with your specialized product may seem to be a daunting and complex process. Growing your small business online from a single market in Birmingham, England to global ecommerce site in Sao Paulo, Brazil, Paris, France, Los Angeles, California and Shanghai, China will be challenging; but all of the challenges can be overcome. There are eight initial challenges to getting things started with global ecommerce, each with solutions available to you:

  1. Product
  2. Product classification
  3. Duty and tax
  4. Language
  5. Payments and currency
  6. Shipping
  7. Marketing
  8. Mobile


1. Product: Targeting
Will your item sell in other markets? Most of your time and money should be spent here 1 including the frequency of returns and associated shipping logistics. Test the market slowly and methodically, and perform short term tests to understand what categories will sell. Markets are paradoxical and sometimes unpredictable, which can present opportunity for you. For example China is the largest producer of powdered milk in the world, but paradoxically Chinese buyers prefer to import the item from Japan–even at a much higher cost.2

2. Product Classification: HS code
Classifying your product correctly will allow it to speed through foreign customs. Not having the correct classification or harmonization code on shipping documentation will ensure it gets stuck in customs abroad—forcing your (now unhappy) customers to pay that fee before they can receive it. Most retail products that get “stuck” in customs quickly become cancelled orders. Many smaller retailers classify products only on confirmed orders from abroad. But in any event, getting the correct Harmonization System (HS) code onto your shipping documentation is your friend in speeding your shipped product through foreign customs.

3. Duty and Tax
The correct harmonization code will allow you to calculate the correct duties on your products. Naturally, keeping duties and tax up to date for your shoppers abroad is key.

4. Language: Translation is Imperative
The paradox of global ecommerce is that to reach the world, online retailers must focus intensely on being as local as possible. Nothing builds the cultural bridge faster than accommodating to the local language, which takes effort. Locally translating product descriptions and your entire ecommerce experience makes it truly global ecommerce, allowing you to compete with local alternatives.

Alternatively, not translating products ensures that the vast majority of “local” buyers in any market won’t be able to easily find your product through local search. And then even if they do find your product, they won’t easily be able to compare your product to other local alternatives. The bottom line: translate your products and keep new products up to date as you continue to curate and update your local sites in multiple markets.

5. Payments and Currency: Localize, Localize
If customers in the US see a Euro symbol, then it is sure to drive them away immediately. Shopping cart abandonment already exists for many reasons, but forcing online shoppers to both browse and pay in a currency that is not their own is certain to reduce your chances of success at global ecommerce. To help stem the tide, many ecommerce solutions are adapting multi-currency rates. Rounding currency converted numbers may offer psychological benefit as well, for example: €26.00 looks a little cleaner than €26.12.3

Applying local payment customs to local shopping carts also makes a great deal of sense. Brazilians prefer paying for online items in installments, and 85% of Indian transactions use cash on delivery.5 Many Polish consumers don’t have credit cards, but don’t mind signing up for third-party solutions called e-wallets. This trend is not unique, with localized e-wallets in many countries where ecommerce is booming: AliPay (China), Qiwi (Russia), and Skrill (United Kingdom) are steadily gaining market share. These online virtual wallets allow international transactions but cater specifically to their home countries.

6. Shipping: Start Small and Smart
The tolerance for international shipments online varies across cultures. While recent figures show nearly 100% of Indians prefer to shop within their boundaries, while over 40% of UK consumers will order an international item online.3 Cash on delivery systems add an additional layer of reverse logistics, but the hassle may be worth the added sales and are still required if you intended on succeeding in markets like Russia or India.4 The best place to start is to talk to your current local shipping provider about their international services.

Take the time to understand how to “classify” your products correctly for international shipping so they can clear customs and not burden the buyers from abroad.7 Better yet—include the full “landed costs” in the prices that your customers browse.

7. Marketing: Search First, Be Found
UK consumers prefer direct point-by-point advertising. Many APAC consumers seem to prefer less brand advertising as opposed to product advertising. Europeans are less receptive to any type of advertising than other cultures. If your advertising expands beyond simple PPC, consider a local marketing and advertising group to assist (they’ll know the local regulations too).1

In all global markets, using a platform that is search engine optimized (SEO) is key. The code to build the platform market is “SEO semantic code” for online bots to automatically index your relevant content.6 Within the platform itself URLs should include keywords that your customers are going to be seeking through search. Regardless of price, push your ecommerce platform provider to make sure you are to scale your business abroad.

8. Mobile is Global
As Facebooks’s acquisition of WhatsApp demonstrated: access to mobile users in developing global markets currently defines access to those markets. The vast majority of the world’s next 5 billion Internet users are going to access the web via mobile phone. Closer to home, the mobile commerce numbers also remain buoyant: it’s clearly the fastest growing medium the world has ever seen. There’s one simple conclusion: mobile is mandatory and your ecommerce platform simply must have a mobile dedicated app or responsive design, out of the box.

Prepare for Your Success
Don’t be afraid to outsource what you don’t know, including language support and even product classification of harmonization codes. Once you start succeeding with a single export market, scaling your ecommerce customer service could mean multiple language requests and even 24 x 7 support (good problems to have). Get ready, start small, and persist: global ecommerce is upon us and tremendous future of growth is ahead for those determined enough to drive their own success abroad and make it happen.

Sources:

  1. http://goo.gl/5rAHjq, The Global Marketplace, USC Consumer Psychologist.
  2. http://goo.gl/nGyyXi, What Chinese Shoppers are Buying Online, Aug 2010, Forbes.
  3. http://goo.gl/gy0gwx, Seven Tips for Global Ecommerce, Mar2012, Econsultancy.
  4. http://goo.gl/k5DHwI, Should Russia be your Next Ecommerce Frontier?, July 2013, Venturebeat.
  5. http://goo.gl/hEcVSG, Online Stores Think Local to Grow Global, Jan 2014, CNBC.
  6. http://goo.gl/uRm0XW, 13 Semantic Markup Tips, Dec 2012, Chris Smith.
  7. http://goo.gl/6pQoXJ, 2014, World Customs Organization.