More than 2.14 billion people worldwide are expected to buy goods and services online in 2021. This increase in connected consumers has impacted regional marketing growth as international campaigns utilize the internet’s reach. Today’s brands find it easier than ever to reach global customers. Recent surveys find that consumers worldwide are more open to shopping outside their home countries than ever before. In Europe, cross-border25.5% of all ecommerce is cross-border.
According to a report by Adobe’s ecommerce division, the pandemic increased online shopping in the U.S. by $183 billion, and other countries also saw significant gains. Pandemic-related store closures and social distancing sent millions of consumers online in search of goods. Some customers may return to post-pandemic levels of in-person shopping at some point. However, most will maintain or even increase online purchases thanks to the convenience and wide selection of international brands.
Customer Experience Drives Conversions
There are several reasons why consumers shop cross-border. The primary reason is cost. Nearly 70% of global consumers who shop abroad do so because prices are lower outside of their home country. Many customers also shop for items that are unavailable in their own countries or unique to the land of origin. While price may be a leading purchasing factor, perceived value is what makes the sale. Is the item ultimately worth it?
While global ecommerce jumped to $26.7 trillion recently, cross-border e-tailing is still in its nascency. It wasn’t long ago that an overseas purchase was both cost- and time prohibitive. In addition to steep shipping and duty fees, customers could wait weeks for an item to pass through all the necessary channels and finally arrive. It’s been nearly twenty years since global e-tailer Amazon introduced free 2-day shipping in 2005. Customers around the world expect near-instant gratification. Waiting several weeks for an item to arrive is acceptable for bespoke goods perhaps, but no longer for general purchases.
Naturally, fast, low-cost shipping plays a large part in conversions, but it isn’t the only factor. The goal for every company should be to create a frictionless customer experience from beginning to end, regardless of the shopper’s location. Sitewide localization is crucial, not just on the checkout page. Transactions should be seamless with prices in the local currency with accurately calculated duties and taxes displayed. Acceptance of diverse local payment methods and a clear return policy also influence successful cross-border purchases. Remember, any snag in the purchase process is an invitation for customers to seek out a competitor.
4 Signs Your Legacy E-commerce Platform is Behind the Times
The decision to implement new business systems is rarely made lightly. In addition to upfront financial investment, disruption to operations, training and onboarding, and other cost factors must be considered. But sometimes indicators for change are too big to ignore. If you find yourself with a vendor exhibiting these signs, it’s time to evaluate more future-ready ecommerce solutions. Here are a few questions to consider:
- Cross-border isn’t their specialty. Some legacy systems have revealed that cross-border is an afterthought compared to other business units. Is cross-border commerce just a small part of the overall business, or like Flow, is your vendor dedicated to and focused on maximizing global sales for online retailers?
- Costly shipping delays. Are your consumers still waiting for their orders to arrive? Hubless shipping is important. Flow has optimized global logistics by providing direct shipping that doesn’t require orders to go through a cross-dock. This minimizes cost, in addition to reducing shipping times.
- Outdated technology. Is your platform modern and driven by tech innovation? Flow’s cutting-edge technology regularly offers feature-rich updates that address the needs of online merchants and can meet their requirements..
- Lack of transparency. Flow doesn’t hide fulfillment operations or true costs from merchants. Can your legacy vendor say that?
Creating a Borderless E-commerce Experience for Future Growth
Statista projects cross-border sales to account for 22% of e-commerce shipments of physical products in 2022 compared to 15% in 2016. Customer access to and awareness of international brands is expanding quickly. Is your company prepared to meet tomorrow’s demand for cross-border commerce? Here are five key areas you should evaluate:
- Technology and Innovation. Implementing the right technology to streamline and simplify the complexities of cross-border shipping is the key to driving revenue. Being a first-to-market vendor makes a nice press release, but it doesn’t mean much unless it’s backed by continuous innovation and improvement. If sales operations are bogged down by clumsy outdated legacy systems that lack modern features, it’s time to switch to a future-ready platform that provides regular updates and improvements.
- Customer Empowerment. Who is in the driver’s seat? Your cross-border e-commerce platform should meet your needs, as well as those of your customers. No one knows your business like you do, so the ability to customize configurations and access revenue-boosting tools should be in your hands when you need them. Instead of being at the mercy of a vendor and their timetable to make essential changes, look for a solution that gives you more influence over the details like managing price margins at multiple levels, performing multivariate A/B testing, and other growth-enhancing merchant controls.
- Speed and Agility. Even the best technology won’t make an impact if shipping and logistics aren’t in sync. Hubless fulfillment can shave valuable days off of shipping times, lower costs, and positively impact conversion rates. Seamless localization backed by optimized checkout can improve transaction times and delight customers.. Online retailers with the ability to meet rising demand from pandemic-related shopping increases can fare better than those left scrambling to put an effective system in place after the fact.
- Customization. Don’t get locked into a one-size-fits-all platform that doesn’t meet your specific business needs. A modular software solution gives you the power to pick and choose the best options for your company, or you can implement the full end-to-end solution if you prefer. Modern systems should have robust API-first architecture and platform connectors for quick integration with existing tech stacks. Stop paying for features that don’t move the needle for your business.
- Transparency. Just as transparency in pricing and return policies are crucial to cross-border shoppers, your solution should offer the same openness to you when it comes to TCO and ROI. You shouldn’t need to hire a team of forensic accountants to figure out the actual cost of your investment in a tech platform. A merchant-first solution should provide visibility throughout the entire customer journey and shipping process, so your team always knows what’s going on firsthand, and more importantly, how much it costs.
Whether your brand is new to global commerce or has been selling in foreign markets for years, it’s vital to ensure your cross-border solution grows with you into the future. Attention to these areas will guarantee that it does.
Save time and ask the right questions when evaluating potential cross-border ecommerce solutions with Flow’s free cross-border ecommerce solution provider request for proposal (RFP) here.