What is cross-border ecommerce?
Cross-border ecommerce defines online international trade. It involves the purchase of products via an online merchant outside of the consumers national borders i.e. the buyer and seller are not located in the same country and use different currencies (and perhaps different languages).
The norties have given rise to cross-border ecommerce for both B2C and B2B providers, as it offers an immense opportunity for merchants and brands to seamlessly grow their online customer space and effectively, increase online sales.
However, many merchants all too quickly render cross-border ecommerce too complex due to the perceived challenges that could incur for both the brand and the consumer. Especially for Australian companies; our distance from the majority of the first world can seem an intimidating feat to overcome.
The biggest challenge seems to be the fear of maintaining a frictionless and localised customer experience for the consumer, whilst simultaneously providing scalability, control and adaptability for the merchant.
The general consumer poses the question:
“How can I trust a brand priced in a foreign currency with opaque delivery services? What if it’s not what I want? What is the risk? What taxes will be levie?”
If you’re currently exercising your business as a successful domestic site that goes above standardized requirements, opening the doors to international borders could create a huge opportunity for your brand/business to grow your customer base, and incrementally increase sales. It’ll also simultaneously strengthen the overall merit of your brand.
How Can You Get Involved In Cross-Border Ecommerce?
Platforms like Borderfree (established 1999) provide hundreds of online retailers the opportunity to ship more than 200+ countries. Their platform allows shoppers to checkout in the shoppers local currency, take advantage of platform-exclusive offers, make multi-merchant orders and rely on trustworthy, international shipping regardless of where they happen to be placed in the world.
In late 2016, Pitney Bowes launched borderfree.com in Australia, and now leading home-grown brands such as Tony Bianco, R.M. Williams and Adore Beauty are taking full advantage of the platforms reach and its assurance for international growth.
According to McKinsey and Company, in 2016 the value of cross-border ecommerce amounted to over $50 billion AUD. Moreover, Australia was estimated to be the fourth most popular source of products, just behind the US, Japan and Korea.
Australian retailers would be silly to disregard the potential opportunity.
How Do Retailers Tap Into Huge International Markets?
According to Nielsen, in 2018 cross-border ecommerce is set to grow to US$307 billion across six core markets: US, UK, Germany, Brazil, China and Australia.
Australian merchants tapping into the Chinese market alone, will immediately afford access to over 300 million potential shoppers – those same shoppers who happened to spend over US$500 billion entirely online in 2015. As Jack Ma, CEO of Alibaba has stated,
“In other countries, ecommerce is a way to shop. In China, it’s a lifestyle”.
Moreover, it’s been reported by Startrack that 38% of Japanese consumers purchase goods overseas. With our (reasonably) close proximity to the asian market, this is an extremely exciting statistic for Australian merchants. One that is surely hard to brush off…particularly for retailers selling cosmetics, premium wine and vitamins/supplements (Startrack reports these as the most popular items Japanese shoppers tend to buy from Australian retailers).
Additionally, cross-border ecommerce for Australian merchants allows for many quick-wins with countries where English is their first language. Excluding the obvious US & UK, we can’t forget countries such as Canada, where cross-border orders account for 75% of the country’s entire ecommerce market. Other tempting markets include the Netherlands, Germany and Scandinavia where English is fairly proficient across the board – enough so that shoppers will not be put-off by English-based websites.
How Can You Prevail In Cross-Border Ecommerce?
If you are going to go-ahead with cross-border ecommerce, it’s important to note there are a few things on your ecommerce website that will need to be enhanced and customised for cross-border success. This all comes down to knowing who your international shoppers are and how, why and what they shop for i.e. What country are they buying from? Which timezone are they located in? What season is it where they are? This is particularly important for clothing brands, as Australians typically follow a different climate pattern to the rest of the world. It’s also important to research your international competition and point out exactly what makes them successful.
Customising your online store to target specific regional needs (that are proven traffic-sources for your brand) will speedily increase the likelihood of converting your cross-border shoppers.
How Can Small Businesses Lead Cross-Border eCommerce?
“Local retailers have a huge opportunity to take advantage of cross-border shopping. The first step is to ensure your technology is aligned” – John Banfield, CEO of BPAY.
As The Australian points out, cross-border ecommerce is not just limited to the larger, untouchable retailers. Business scalability has never been more painless. In fact, the flexibility and adaptability that all small businesses require in order to survive give them a landslide advantage over larger, less-adaptable corporations.
The Australian also reported that in 2016, the number of Australian trade businesses increased (for the third year in a row) by 2.4%. This can be put down to the extreme growth of small businesses. The growth of small businesses can then be put down to the billions of consumers all over the world making online shopping their number one location for consumer goods.
Borderfree says, cross-border ecommerce “should be just as easy to buy fine tailored tweed from the U.K as it is to shop at your local corner store in Australia.”
So, rather than sitting back and waiting for the rest of the country to do it before you do, stop procrastinating and find out how your online store can get involved in the cross-border conversation.
Here at acidgreen, we’re more than happy to help you accomplish those goals. As a full-service digital agency (Magento and Shopify Plus Partners), we have over fifteen years ecommerce experience helping our diverse range of clients achieve ultimate online success. Contact us today and find out how your company can confidently reach beyond the Pacific.
acidgreen is an award winning e-commerce agency specialising in Magento, Shopify Plus and digital marketing with over 15 years of industry experience. Our certified developers and digital marketers are highly qualified to create aesthetically pleasing Magento and Shopify Plus websites that generate the highest amount of conversions and provide the best ROI. Be sure to follow us on LinkedIn, Facebook and Twitter, or give us a call to learn more about our services.