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First things first – if you’d like a copy of International E-commerce Expansion Benchmark Study the J. C. Williams team released at the Annual Summit last month, click here. And thanks again to our sponsors, Access Technology Solutions and SafetyPay for making distribution of the study complimentary.
We’ll wrap up the series of posts we’ve pulled together this year on international e-commerce by highlighting some of the dialogue that the study stirred up.
One of the best comments came from a CEO-guy across the table who attended the session where Jim Okamura hit the highlights of the study and interviewed the esteemed panelists. He had that slightly worn look one has at the last session of the last day, but he was totally into the idea of going global.
Finally he looked over at his VP of e-Commerce and said “Let’s just do this.”
The International Growth Story
Chris O’Neill, who runs Google’s retail practice, was a welcome opening host for the session. He set that stage nicely by commenting that:
- Well over 50% of Google’s growth is from markets outside the U.S.
- In order for Google’s CEO to approve any program, it must have a global plan
- From an organizational perspective, discussions about international initiatives often revolve around the trade-offs between centralization and de-centralization
What should we watch for on the international front? According to O’Neill, innovations in payments “in a world without the financial payment infrastructure the U.S. takes for granted.”
And stay tuned for how machine translations will fulfill the vision of a border-less e-commerce landscape and where advancements in analytics will leverage data to understand international customer needs that are not being met.
A New Chapter in the Customer Experience Saga
Of the many barriers the study highlighted, the one that requires the most urgent attention is the generally poor online experience that most international shoppers encounter, an ironic similarity to the early days of e-commerce in the U.S. the study points out.
Another key finding was that an expanded range of strategic options has replaced the “all or nothing” mindset that until recently prevailed among international strategists. Each option has its own different risk/reward profile and collectively, they provide online retailers and consumer brands greater strategic flexibility, which is critical in today’s challenging retail environment.
A “middle” stage of international e-commerce expansion is emerging, which the study calls the “Participatory” stage. Aided in part by the emergence of “sell-and-ship” solutions providers, this stage offers online retailers a low-cost, low-risk way to dramatically improve the international customer experience while also ramping up global sales.
Global Logistical Expertise is Evolving Regionally
An interesting ancillary finding emerged on the expo floor at the Summit. As one visited the vendors that are opening doors to international e-commerce, one found that those with logistical expertise currently tend to specialize in different regions of the world.
Not surprisingly CanadaPost/Borderfree excels in Canada while Pitney Bowes (e4x/fiftyone’s logistical partner) delivers the goods throughout Europe.
Access Technology Solutions has built a sophisticated network of trade channels and customs brokerages throughout Asia-Pacific. In fact you can ship express packages from the U.S. into Japan for about what it costs to ship from California to New York. And it can get there quicker.
Meanwhile Borderjump/Aeropost is fulfilling thousands of international orders daily throughout South America. Look for some consolidation in this sector in the year ahead, but for now, choose your market and go with the strongest player in that region.
Social and Mobile: Hot Panel Topics
No way can we hope to pack in highlights from the report’s findings plus insights from the panel session at the Summit into this no-longer-short post. Several quick take-aways for you.
One of the biggest challenges of going global is balancing existing brand equity/controls with the need for local relevance. The panelists agreed that tracking and measuring brand equity is tough globally, especially in the Asia-Pacific regions.
However, social media is evolving as a means to cost-effectively tap communities and facilitate word-of-mouth ─ and by doing so, to better understand how to adapt brands to local market preferences.
Panelists also agreed that having a mobile strategy is an essential component of going global. Depending on which international market you target, expect 20% to 40% of the traffic coming to your site to originate from mobile devices ─ and plan for women to over-index on mobile.
Organizational Catalysts?
The panelists provided advice for e-commerce professionals trying to push their leadership to go global. After conducting initial market assessments, focus on understanding the types of payments that are locally relevant.
Accept that payment models will not be one-size-fits-all. In China, expect to accept at least five types of payment. In Germany, more than half your holiday orders may go out with an open invoice.
Next Stop: Monaco, October 26-28th
It’s always intriguing when you put almost a year into conducting a study and then it’s done. But of course research is never really done, in fact, we’ve barely written the first chapter of the international e-commerce expansion story.
The next chapters will provide different viewpoints. The Shop.org Global e-Commerce Summit will offer a diverse collection of best practices and insights from leading global e-commerce professionals outside the U.S.
And look for a quantitative study exploring international e-commerce expansion from the J.C. Williams team next spring, with a focus on how online merchants of different sizes are mastering global e-commerce.
Until then, enjoy the International E-commerce Expansion Benchmark Study, the most uncreatively-titled report out there today.
Thanks,
The J.C. Williams Group
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