The timing for brands to expand into new markets has never been better. For many people, the global pandemic accelerated a shift to online shopping. Our 2021 Flow Cross-Border E-Commerce Consumer Report found that 76% of consumers expect to maintain or increase online spending despite brick-and-mortar outlets reopening. Customer expectations regarding shipping times and costs are also changing as more consumers shop online.
Unprecedented E-Commerce Growth
While store closures and social distancing measures forced many to adopt online shopping during the pandemic, convenience, selection, and better prices keep consumers coming back. In one recent survey, 20,000 consumers in 12 global markets were asked why they shop online. Respondents gave three reasons: the ability to shop day or night, the convenience of staying home, and better prices. Price is essential to cross-border shoppers, 67% of whom purchase because some goods are cheaper online than in their home countries. Even without a pandemic driving growth, cross-border e-commerce continues to increase as many parts of the world gain improved access to the internet and mobile adoption. Google predicts cross-border e-commerce to grow 25% annually, double the rate of domestic.
The New Expectations of Online Shoppers
In the past, tax, duty, and expensive fees combined with weeks of shipping time made shopping overseas impractical and expensive for consumers. Today is a different story. Improvements in technology and international logistics have vastly improved the cross-border customer experience. But consumer e-commerce expectations have aligned with modern shipping capabilities. Although international shoppers may not yet expect a product overnight, Flow’s recent survey reveals that most wish to receive their order within 3-to-6 business days. Any longer, and you risk disappointing customers.
Faster shipping isn’t the only changed global consumer expectation. Respondents to Flow’s global survey stated that high shipping costs (45%), lack of free shipping (38%), and expensive prices (27%) were all significant barriers to making cross-border purchases. With fast, free shipping on every shopper’s wish list, companies must explore ways to fulfill their expectations while still turning a profit.
Effortlessly Manage Global Order Fulfillment
Los Angeles-based fashion and lifestyle brand PAIGE always intended to expand internationally. Global markets like Germany and the U.K. showed strong demand for the popular California denim brand. PAIGE’s leadership initially decided to outsource their digital presence, both foreign and domestic, to an external vendor in order to meet the growing volume of orders. But the outside vendor introduced a host of problems ranging from long shipping times to poor customer support. As demand for their products grew, PAIGE had trouble keeping up with orders from fans in rapidly developing markets like Australia, Canada, and France. They knew it was time to regain control and bring e-commerce operations in-house to scale efficiently.
The legacy vendor lacked transparency and provided poor customer support. They also used a cross-dock logistics model that added to lengthy delivery times and high shipping costs. Cross-docking, named for the process of receiving goods on one dock and transporting them to another for overseas shipping, was established in the 1930s. Although technology and international logistics have improved the efficiency of this model, the method remains the same.
In cross-border e-commerce, a retailer sends their goods to a domestic hub where it is assessed for tax and duty fees and then packaged for international shipment. Cross-docking may make sense in some instances; however, in general it is an expensive, time-consuming, and unnecessary step that directly impacts customer satisfaction for many online retailers. With Flow’s help, PAIGE eliminated this outdated model in favor of faster, less expensive, direct-to-consumer shipping. Read the case study to see the results the brand saw from working with Flow and leveraging our direct shipping model.
Improved Customer Experience with Direct Shipping
Slow shipping leads to disappointed customers, bad reviews, and costly churn. PAIGE saw immediate improvements in customer satisfaction and retention by providing more reliable and accurate shipping windows and a better overall customer experience with direct shipping. By modernizing the company’s cross-border shipping and logistics, the PAIGE team can now manage their customs documentation, set localized shipping tiers by country, and manage order tracking. With Flow, PAIGE localized their check-out page into 21 languages, offered native support for 71 countries, and saw an 82% increase in YoY international orders and a 96% increase in YoY global sales.
Four Benefits of Direct Shipping for Cross-Border E-Commerce
Direct-to-consumer shipping is the best choice for companies serious about maintaining end-to-end control over the e-commerce experience. Your brand doesn’t end at check-out for shoppers, and everything that happens after impacts their opinion of your company. Customer retention costs significantly less than acquisition, and improving retention rates can greatly impact sales. Global consumers don’t care if you are located halfway around the world; they expect the same fast delivery times, low costs, and stellar customer service that they receive at home. Switching to a hubless shipping model can help you provide just that.
Transitioning from cross-docking to direct shipping can benefit brands looking to expand internationally. By providing faster shipping and lower costs to a growing market of global consumers, companies will gain the benefits of a loyal international customer base. Cross-border customers can face high fees and extended shipping times when buying their favorite products online. Alleviate this pain point and watch sales grow.
Ready to expand to new markets? Partner with Flow for seamless international shipping and logistics. Find out more.