If you’ve dreamed of pursuing cross-border sales in order to scale your business, then you may be wondering what it takes to get started in global e-commerce.
It’s no wonder cross-border sales continues to be a pursuit of many. With a projected growth to $6.3 billion worldwide for e-commerce sales by 2024, there are no signs of slowing down.
But launching a cross-border sales strategy takes carefully planning and thought. In the same manner where you would take your time to establish a solid domestic strategy, you need to do the same for a global one.
Why cross-border sales are beneficial
Whether your goal of selling internationally has been in mind for years, or if you are only now exploring the idea, there are numerous benefits of selling outside your home country that are worth consideration.
For starters, it expands the number of customers you can potentially reach. More customers means expanding both your revenue potential and your brand.
As your domestic market ebbs and flows in revenue, selling in other markets provides additional revenue opportunities that might not be available to you domestically. Or, as your domestic sales experience a slump, for instance, your sales in other countries can fuel the growth you need for a more balanced portfolio.
International e-commerce sales continue to play an important role in business. In 2018, Visa conducted a study and found 87% of businesses surveyed considered cross-border sales essential to long-term success. In addition to this, 66% of e-commerce businesses surveyed are already selling globally, further highlighting the importance of this segment of sales.
So what does it take to get started in this beneficial practice? Let’s take a closer look at the fundamental first steps to help you launch your global dreams.
1. Fine tune your domestic e-commerce store first
The very first step in preparing for a global platform is to look inward first. Understanding your domestic market and current state of business in your home country is a vital first step. If you struggle in certain areas, such as mobile optimization, or customer service inquiries, then perhaps spending time fine-tuning the areas first can aid in a more successful launch in other countries.
This doesn’t mean there aren’t hiccups along the way or issues that need to be addressed closer to home. It simply means you want to be as strong on the domestic front as possible, so you can build on the strengths as you expand.
2. Use the analytics from domestic sales to choose the next market
Keeping with the theme of focusing on your domestic site first, it’s important to understand what’s working with your current business, and what’s not. It’s up to you and your team to decide if you’ll stick with current practices when you expand, or if it’s more important to launch an entirely new way of doing business.
For instance, look at the shipping model your business currently uses. Is it working? Are you losing too much money, or have you improved the process by going with a third-party? Whatever the answer is, use this information to understand how you may operate in another country.
This kind of info will also help guide your discussions on which markets to target. If there are areas where you excel and have a solid number of best practices, having the numbers and analytics provides support as you research the next ideal market for your product or service.
3. Research the e-commerce market in new target area
One you’re comfortable your efforts can be put towards expanding your product, it’s time to research your new target area. This means knowing what market is most likely to embrace your product or service, and where there’s enough demand.
This also means thoroughly researching the logistics aspect, as well as taxes and duties. These are extremely critical components of selling abroad, and important enough to be a part of the ongoing research.
Practically speaking, if you already sell a product in the U.S., a great resource to start this search is with export.gov and the country commercial guides. This gives you information on the market conditions of a country, any opportunities available, the business customs and regulations that need to be followed.
It’s not only a fantastic resource for researching a potential market, but also once you decide to sell in a certain area. The export.gov site provides you with all the up-to-date information on business travel, regulations and other critical information as you’re establishing your expansion.
4. Talk to the experts
Another aspect of researching your new e-commerce market is to talk to experts who are familiar with doing business in the potential market. While you probably won’t be able to talk to a business owner who sells a competitive product of yours, you can likely find experts in fields that support your type of business, such as marketing, website developers, logistics, and transportation for instance.
This is an important step to actually listen to what the experts are saying. The last thing you want to happen is to launch in a new country and be totally unprepared. This type of insight can prove to be invaluable.
Talking to experts means gaining a greater understanding into customer insights and expectations in the new market. Ask questions about the potential demographics, use cases, mobile and website usage. Understanding the needs for shipping, taxes, payment methods are all questions you can gain further insight on by talking to experts in the new area.
5. Map out your new strategy
When you started your e-commerce business, you likely didn’t jump in feet first without any planning or strategy. The same approach is needed as you venture into cross-border sales. Once you’ve chosen the new target market, then it’s time to define your new sales strategy.
This means strategizing on several priority topics, including:
- Choose one country to focus on: As tempting as it is to want to make a big splash globally and with multiple countries, the best approach may be one of restraint. Choose one market first, do it well, and then focus your efforts into new places.
- Launch plans: Formalize your launch plans and communicate with your team. When working in a new market or overseas, there really is no such thing as too much communication. This is the time to create your timelines, brainstorm your marketing and product ideas, and assign tasks to each of the team members.
- Define updated shipping strategies: Not only do you need to work with a third-party company such as FedEx or UPS for your global shipping questions, but your new shipping policies need to be defined as well. Will you offer free shipping on returns? How many days does a customer have to return an item? How will you process the returns? All of these questions, and others, need to be answered prior to launching.
- Update and optimize your website: You want the shoppers in the new market to be able to read your site in their language and pay with their currency. This all needs to be updated prior to launching so you don’t risk turning away any shoppers. This includes mobile sales too – some countries rely more heavily on smartphones for purchases versus others. Understanding website and mobile phone behavior is crucial to your conversion rate.
- Update customer service policies: Clearly communicate your new customer service policies. This includes how you will handle refunds, exchanges, live support, and other critical components of customer care.
- Create updated payment policies: Understand the impact of selling overseas to the payments you can accept as well as offer.
6. Offer an installment payment solution for cross-border transactions
If you want to offer a payment solution that satisfies your shopper’s need for a pay over time option, then consider the benefits of adding Splitit to your payment options.
Not only does Splitit allow your shopper to break up their purchases into smaller, more manageable monthly payments, but it does so without any interest or fees, or an application process. It works with your shopper’s existing credit card information, which means it’s a quick and easy process at checkout to select the Splitit option.
Globally speaking, Splitit has the ability to operate worldwide. You don’t have to worry about setting up a different Buy Now, Pay Later option in each country, since Splitit works seamlessly with other currencies.
The result for your business is a higher average-order-value (AOV), increased conversion rate, and overall increased revenue. And when you’re launching your business in a new country, you need as much leverage as possible to gain success early on.
While selling overseas may seem thrilling, if not a little daunting, the proper amount of planning and research will set you up for a greater chance of success. The main step is to understand what is working for you on the domestic front, and build on this success in other countries.
If you are curious how a monthly installment plan like Splitit can help you achieve your goals in a global market, request a demo to see the latest benefits.