Global Dominance: Breaking into the US Market

Global Dominance: Breaking into the US Market

In 2018 total ecommerce sales across the US were worth over 500 billion dollars. And the growth does not stop there. By the year 2022 the US ecommerce market is forecast to be worth a staggering 700 billion dollars¹.

For many UK based ecommerce businesses, cracking the nut of the US can feel like a huge undertaking. With the right focus, however, getting a share of the American pie can be a great first step on the road to international expansion.

1. Planning is Key

The US market might feel familiar to UK businesses, but don’t be tripped up thinking that what works for your UK customers will work across the pond.

 

1. Investigate the traction of your product through Google Trends and your own analytics. If you are already seeing some sales in the US, use your own data to drive conclusions around which products are appealing.

2. Be aware of who operates in your space within the US and what they are doing well.

3. Set a strategy. Examine trends from any existing customers within the US. If sessions to site are high, but your conversion is low, focussing on service and pricing could be key. Conversely, if your website converting well but few customers are coming across your brand, your focus should be on marketing. Even without existing customer data, setting a strategy around the key points of interest will help you measure progress and focus your efforts and spending in the right area.

TOP TAKEAWAY: Do your research and set a focussed strategy from which you can benchmark success

2. Service First

The single most important factor to consider before expanding into the US is service.

 

1. US customers expect delivery services to match what they could expect from US based companies.

2. Don’t attempt to offer next day delivery as the costs far outweigh the benefits. The sheer size of the US means that next day delivery is not always an option even for US based sellers.

3. Focus efforts instead on offering free delivery to your US customers. If this is impossible within your current profit margins, introduce a delivery threshold, or even think about increasing prices to offset the delivery costs.

4. Be reliable. A large consideration for customers ordering from a non-US country is a lack of trust. Build trust in your business by monitoring delivery times, making sure promises are kept, keeping track of ratings, and ensuring customer service is great.

TOP TAKEAWAY: Ensure service is as good as or better than the local competition

3. Payments

 

1. Traditional credit and debit card payments continue to dominate in the US, although PayPal also accounts for a significant minority. Ensure your business caters for the main payment cards, including specifically American Express.

2. Over the past 5 years, digital wallets have also gained significant traction across the US, a trend that shows no sign of slowing down with the rise of the mobile consumer. Integrating with Apple Wallets, Android Wallets and Samsung Wallets will put any business ahead of the curve.

TOP TAKEAWAY: The future is in e-wallets. Get ahead of the curve by focussing on this now

4. Marketing

To break into the US market, understanding how each channel differs from the UK and leveraging their strengths will underpin success.

1. Affiliate marketing, whilst costly, is a huge business in the USA. Use this channel to drive brand awareness and new customer growth, and focus on a strong CRM strategy to keep these customers coming back. Remember most affiliates only charge on conversion, so any additional traffic to site or later conversions are free.

2. Paid marketing through PPC can be expensive, especially when the average cost per clicks in the US market sit at around 13% higher than in the UK². However, while CPC is high, conversion rates through PPC in the USA are generally better. Be sure to push products which are high value, have generous profit margins and are appealing to US customers to keep this channel profitable.

3. Finally, building a strong CRM strategy is the quickest, and cheapest, way to grow traffic to your site. Segment the emails you send, so that your US customers are targeted with the most appealing products and offers. Keep a seasonal promotional tracker so you can hit key shopping days in the US with strong exclusive promotions.

 

Do not lose site of your initial KPIs. If traffic is already good, but bounce rate and conversion are performing badly focus your time on these areas before a huge marketing drive.

IN A NUTSHELL: Be prepared to spend to get the traction you need to grow

5. American Context through Content

Providing the same payment methods and delivery options as US-based competitors will go a long way in gaining traction with US customers. To take this further develop the functionality to provide US currency and even bespoke content.

1. First, develop a currency dropdown selector where users can choose to switch to dollars.

2. Second, expand on this and automatically choose the currency based on IP Address – you should either tell your customers that this has happened or offer an easy way to switch back.

3. Third, create an international pricing structure whereby base pricing can be adjusted by territory to remain competitive or to ensure products remain profitable.

4. Once you have a significant US customer base, recreating the website with Americanized English, and with promotional content aimed at attracting a US audience, could lead to increased conversion rates.

5. The quickest and most impactful method to do this, is to develop the functionality to manage home page content separately for differing locals. You can then set this based on either IP address or chosen currency/shipping location.

6. Should you want to take this to the next level and rewrite content on the entire site in Americanised English, you should consider creating a separate website for your US business which is managed alongside but separately to your flagship website. This step should only be undertaken after strong initial growth is evident.

TOP TAKEAWAY: Focus on providing a native currency experience for quickest wins

6. Review, Review, Review

You’ve set your goals, you’ve improved your service, you’ve invested in marketing and your site is optimised to a US audience. Don’t just stop there.

Review your progress against the original KPIs you set at the planning phase. As you gain more traction you will have more information to inform future decisions. Whether you are successful or not, review strategy at least once a quarter and set new KPIs for the coming months.

If you are not seeing the success you expect, adjust your goals, and try a different approach. Don’t fall into the trap of dedicating a set time to develop functionality, and then considering the project complete.

Get in touch to find out how Venditan Commerce could help improve the shopping experience for your international customers.
Please call John or Chris on: +44(0)161 826 3098 or email us at: startyourjourney@venditan.com

Elizabeth Aspinall
21st Jan 2019

Going Global: 5 Steps to eCommerce Internationalisation

Going Global: 5 Steps to eCommerce Internationalisation

“There are two big things you need for successful internationalisation,” says Venditan Managing Director Chris Maule. “Yes, you’ll need budget—but more importantly, you’ll need patience.”

Our nearest markets have seen Southern European B2C market growth running at a phenomenal 25% (eCommerce Europe). While Forrester report that, beyond the continent, cross-border shopping will account for 1 in 5 E-Commerce transactions by 2022, with US sales hitting a mighty $630 billion.

The scale of opportunity overseas is vast. But the truth is, many UK companies are still grappling with the investment itinerary that comes with internationalisation. In fact, Econsultancy report that 62% of businesses believe they’re missing key opportunities in global markets.

62% of businesses believe they’re missing key opportunities in global markets.

– Econsultancy

So we’re sharing our 5-step checklist to help you take full advantage of the cross-border boom and go global with your E-Commerce business:

1. The price is right

Step one is to take a hard look at your prices in the new market.

No matter how sophisticated your domestic pricing plan is, taking it straight to foreign consumers can price you out of the market—before your international expansion has even started…

Reworking your numbers for the new market doesn’t require a revolutionary approach. Just apply the same research and analysis you originally did at home, paying special attention to the local businesses you’re about to go shoulder to shoulder with.

Remember that markup pricing, vendor pricing, psychological pricing and keystone pricing are all proven strategies. But they’ll only deliver sales as long as you nail the essentials. Don’t make the misstep of being 10% more expensive than a local market competitor on Google Shopping.

2. First-class shipping

International shipping strategies start at home, so take a look at your existing UK base first.

The trick is to invest time with your existing partners. Get to grips with their international service categories, and make sure your shipping matrix can handle the right size and weight items through the right partners.

This is your chance to swot up on your existing operations, balancing delivery costs against the best possible end-user experience.

Free shipping really has “shown a lot of promise in reducing shopping cart abandonment” (Forrester Research), but just remember to stay vigilant about margins when you’re juggling different international costs.

Once all the detail is mapped out, make sure you model it accurately within your E-Commerce platform. Work hard to keep the subtleties of your service category selection with accurate size and weight data—and don’t forget to blacklist countries you won’t ship to!

3. Upgrading payment

With over 250 options from credit and debit cards, to digital wallets and direct debit schemes, all designed to optimise conversions for their global niche, the full selection of local payment options can feel overwhelming. But this isn’t the time to bury your head in the sand.

If you’re selling in Spain, for example, you can safely rely on standard credit and debit cards for 91% of your consumers (eCommerce Europe). But any effective German expansion means investing in payment systems like GiroPay and ELV.

The key is to narrow down your options for the territory you’re trading in.

For instance, as global traders, you can cover the biggest tactics by looking to Visa, Mastercard, AMEX and PayPal. Meanwhile, trading in Europe needs a focus on options like iDeal, GiroPay and SoFort, whereas AliPay and UnionPay are the top choices for China.

4. Get found, get followed

As you shift into full foreign marketing campaigns, just remember:

Getting concrete returns from your search marketing strategy is a tough enough task at home in the UK—taking it on abroad requires the same in-depth approach.

Paid Search is the faster way to results, making it ideal for testing and refining the findings of your pricing research. You’ll still to consider search engine optimisation (SEO) and social media, but remember the value of patience: as always these are slow burning strategies that take time to really deliver ROI.

“In markets where you’re a new brand, you’re competing with established businesses who know the market inside out. Often you may have to build yourself up from the bottom.” – Econsultancy

“In markets where you’re a new brand, you’re competing with established businesses who know the market inside out. Often you may have to build yourself up from the bottom.”

– Econsultancy

For long-term presence and visibility in Google and other search engines, make sure you’re following SEO best practices from the beginning—you’ll thank yourself later.

When it comes to social media, you’ll need to set up a specialist account for the market you’re expanding into, then build a local following, find evangelists and drive tailored content.

5. Relatable and translatable

It can be tempting to skip out on translation for certain markets. Take the Netherlands: when over 90% of the population speak English (European Commission), why make the investment?

The answer is simple: 9 out of 10 Europeans say they always prefer to shop on sites in their own language when given the choice (European Commission), so translated content is a must if local language competitors are serving up products that directly compete with yours.

But tread carefully.

Cheap and cheerful automated translation can be a tempting option, but nothing erodes trust and reduces conversion rates like translation errors. In our experience, every business should at least consider having a native speaking professional review (if not write!) the content.

Break it down

And that’s it—the first five steps for your international expansion complete.

Even when backed with the budget to pull it off, international expansion always comes with complications, and each country comes with its own unique challenges.

However, the happy truth is that internationalisation isn’t as complex as it seems.

Get it right and you’ll delight your customers while maximising your own profits!

Stephanie Fenton
26th April 2018

Manchester To Sydney In Less Than 2 Hours!

Manchester To Sydney In Less Than 2 Hours!

According to the research institution eMarketer, UK retail eCommerce sales are expected to top £60 billion by the end of 2015, with revenue from outside of the UK the fastest growing part of this total.

And according to Internet Retailer Magazine the rate of this growth will continue in 2016, with the USA, China, Japan, Germany, France, Russia, Canada and Australia all proving particularly attractive territories for cross-border online trade.

So how can a UK retailer, with no physical footprint overseas, take advantage and begin to successfully export?

Demand Versus Emerging Markets

There is a very simple trap to fall into when thinking about Internationalisation of your website: let’s ship to everyone, everywhere! However, this is not necessarily the best approach.

It’s important to use existing data to formulate your strategy rather than look to follow a trend that might not actually be suitable, no matter how tempting it may initially seem. For instance, there is much discussion of rising demand for global products from emerging e-shopping markets such as Brazil, Indonesia, Thailand, China and Spain, with consumers in those countries more than willing to order from international websites.

However, identifying the markets you want to target should be weighed against the existing demand for your product in that territory (search traffic, existing international traffic to your website), along with how well positioned you are to service that customer base in terms of merchandising, competitive shipping costs and handling customer service enquiries.

Google Analytics provides a simple way of understanding your traffic sources, and that’s a good place to start.

  • If you have promising volumes of traffic visiting from Germany, for example, then what devices are people using to view the website?
  • What are smartphone adoption rates?
  • Is there a sufficient search demand for your products in that territory?
  • Are there simple routes to sell your products to German consumers – established marketplaces, for instance, Amazon.de?
  • Paid Advertising?
  • Local Affiliate Networks?

In Germany, the answer is a resounding ‘yes’, but it doesn’t come without its own challenges. Running a Product Listing Ad via Google.de would require your content to be translated into German, for instance, and the price would need to be displayed in Euros.

Is that the case in all the countries you currently attract visitors from?

Ok, so I’m driving lots of traffic from Germany, I can sell via Amazon.de, and I’ve set up paid search campaigns on Google.de. I’m good to start, right?

Maybe not. Even if your brand is widely known in the UK, brand equity may need to be built from the ground up in a new market. There are many considerations, for example, how does your brand name and imagery translate culturally? Causing offence through not exploring all connotations will more than likely result in failure.

Be Prepared for the Long Haul

As with all eCommerce growth strategies, half-baked effort will provide half-baked results. Let’s take Australia as an example – what are the operational and marketing considerations for retailers looking to sell to Australian consumers?

 

Customer Experience
  • Language and Currency – With Australia there is no multi-lingual consideration, but accepting Australian dollars will tailor your offering for the local market
  • Conversion Optimisation – Does the website offer personalised content for the territory?
  • Domains – Use a sub-domain or register the local domain?
Driving Traffic & Reaching New Customers
  • Understanding the local market – device adoption rates, what are conversion rates on smartphones, tablets?
  • Which channels? Email marketing, search – paid and organic, social media, affiliates and established marketplaces should all be investigated
  • Branding – does your branding translate well outside of the UK?
Merchandising
  • Seasonality – does your product mix translate? For example, a fashion retailer who is promoting Autumn/Winter stock in the UK is unlikely to drive full price conversions to Australian consumers who will be in the middle of their summer.
  • Pricing – how do you compare with local and other international sellers?
Order Fulfilment and Shipping
  • Competitiveness – how does your shipping service compare? Can you get your products picked and packed and on its way to your new customer in a time-frame that makes it worth them ordering the product from overseas? Is the price point for delivery going to cover your own costs while remaining attractive against the competition?
  • Reliability – are you confident that your existing courier network can deliver on the promise you have made to the consumer?
  • Distribution – are you legally allowed to sell your products in the country you are shipping to? Are there restrictions – either from a manufacturer or potentially even government regulations/compliance?
  • Customer Service – are you able to offer the same levels as you would to UK consumers? How will you handle returns?
Exchange Rates
  •  Fluctuation – how will you monitor and safeguard against the risk of ever changing rates? How can you protect your margin?
Fraud & Payment
  • Does your payment service provider offer any additional screening or advice against fraudulent transactions that might not be as easy to spot?
  • Methods – do any alternative payment methods exist? Is PayPal or Pay with Amazon a prominent option?

Patience Required

Unfortunately there is no magic wand. eCommerce may feel like a constant cycle of test and measure, and that will certainly be the case as you venture into the uncharted waters of international e-retail. However, it can still be a great way of generating growth for your business, and as you master all of the considerations discussed above, expansion into new countries can happen more efficiently each time you identify a new opportunity.

Entering International Airspace

So there’s plenty to consider then, but fortunately here at Docnet we have plenty of experience of confidently navigating international waters with our retail partners and keeping them safely on the straight and narrow.

So Manchester to Sydney in less than 2 hours?
Our retail commerce platform has helped retailers all the way from taking their very first Euro, US Dollar and Japanese Yen all the way through to establishing a profitable global online customer base.

We recently took less than two hours to deploy a new front end website aimed at the Australian market for one of our fashion retail customers. This used the same template as their existing UK offering but crucially gave them the ability to merchandise it for the Australian summertime (while the UK website is geared towards Autumn/Winter product) and launched with a local domain and pricing/currency defaults to the Australian dollar.

 

Talk to us to find out more.
John Coyne, Commercial Director 0161 8390 101

John Coyne
13th November 2015