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E-Commerce Website Considerations When Selling Cross-Border

By Elena Malykhina

While the Internet has helped level the playing field for small and midsize enterprises (SMEs), those in e-commerce can still face a host of challenges when selling overseas. Indeed, setting up a global online website for cross-border e-commerce must take into account language and cultural differences, selling in multiple currencies, varying technical requirements in various countries, and foreign tax laws—among other issues.

Assessing Cross-Border E-Commerce Opportunities—and Challenges

 

The global B2C e-commerce market is forecasted to reach $7.7 trillion by 2025, increasing at a compound annual growth rate of 11.7 percent, according to Grand View Research.1 Separately, Forrester Research predicts cross-border shopping will account for 20 percent of all e-commerce in 2022, as international shoppers become more sophisticated and the use of e-commerce platforms increases among consumers in new international markets, such as the Middle East, Africa, and Latin America.2

 

With so much activity surrounding cross-border e-commerce, creating a global online storefront may seem appealing to SMEs looking to gain global customers. However, it’s not just a matter of setting up a website. Many issues may need to be addressed first.

 

One major issue involves language and localization.3 A cross-border e-commerce website requires a consistent customer experience, regardless of whether shoppers are in France or Japan. Content may not translate well into other languages, and cultural differences can present complications. For example, what is considered funny or clever in the U.S. could be offensive in another culture.

 

Technical issues are also a factor. A website that loads quickly in the U.S. could take much longer in countries with underdeveloped internet infrastructures. Relying on a one-size-fits-all solution may result in much slower access in certain places and, ultimately, a drop in conversion rates.4

 

Currency and online payment preferences are other common issues for SMEs that serve cross-border customers. International shoppers prefer to see prices in their local currencies and not deal with calculating exchange rates.5 The same goes for taxes and duties, which are often not included—or only estimated—on e-commerce websites.

 

Converting prices to a local currency can be achieved through customer-facing apps; however, optimizing payment preferences for each country is more complex.6 While credit cards are widely used in the U.S., alternative payment methods are more common overseas. 7Worldwide, these number in the hundreds, from bank transfers to digital wallets to cash-in cards.8

 

Tools and Technology Help Address Global E-Commerce Challenges

 

A variety of tools and technology can help address cross-border e-commerce challenges—with data and its analysis at the top of the list. Data can offer a wealth of insight for SMEs to better understand how consumers are engaging with their e-commerce websites. A data analytics tool, for instance, can observe the behaviors of website visitors based on their geolocation or language, and measure whether the website is attracting certain groups.9

 

Analyzing drop-off rates in the paths to purchase can uncover important information about cross-border visitors, such as what prevents them from completing a purchase. If visitors drop out at the product view, it could mean they either didn’t understand an offer or didn’t find a product relevant.10 Audience reports are an effective way to produce this type of data.

 

By gauging where the majority of international customers come from, SMEs also can create localized storefronts. According to leading Canadian e-commerce company Shopify, “growing internationally hinges on localization.”11

 

That’s where tools and technologies can help, as well. For example, services are available that can translate a website into a local language12 —a more cost-effective option for SMEs that cannot afford an in-house solution.

 

SMEs can also deploy tools that provide currency conversion and required tax calculations during the checkout process. This way, cross-border shoppers can “lock in” the price in their local currencies and are less likely to abandon their shopping carts.13

 

Outsourcing the online payments process is another option for some SMEs that want to offer their customers a variety of options, especially in countries where alternative payment methods are widely used.14 Payments service providers offer the expertise and tools designed specifically for global e-commerce.

 

The

Takeaway:

Understanding global target markets and providing international customers with a localized shopping experience can be important to cross-border e-commerce success. This includes the languages overseas customers speak, the ways each market prefers to transact, and the technical issues each might encounter, among other issues. Various tools and technologies can address those issues, helping SMEs to meet their cross-border e-commerce goals.

Elena Malykhina - The Author

The Author

Elena Malykhina

Elena Malykhina is professional writer who has covered science, technology and business for more than 10 years. Her work has appeared in InformationWeek, Scientific American, Newsday, The Wall Street Journal and Adweek, as well as through the Associated Press.

Sources

1.“B2C e-commerce Market Worth $7,724.8 Billion By 2025,” Grand View Research; https://www.grandviewresearch.com/press-release/global-b2c-e-commerce-market
2. “Forrester Data: Online Cross-Border Retail Forecast, 2017 To 2022 (Global),” Forrester Research; https://www.forrester.com/report/Forrester+Data+Online+CrossBorder+Retail+Forecast+2017+To+2022+Global/-/E-RES137898
3. “International Ecommerce Issues: How to Diagnose Global Barriers with Analytics,” Shopify; https://www.shopify.com/enterprise/international-ecommerce-issues
4. Ibid.
5. “Think Tank: An Essential Cross Border E-commerce Strategy for Retailers and Brands,” Women’s Wear Daily; https://wwd.com/business-news/business-features/think-tank-flow-1202916570
6. “International Ecommerce Issues: How to Diagnose Global Barriers with Analytics,” Shopify; https://www.shopify.com/enterprise/international-ecommerce-issues
7. Ibid.
8. “Alternative Payment Methods Are Taking Over Global Online Businesses,” Payments Journal; https://www.paymentsjournal.com/alternative-payment-methods-are-taking-over-global-online-businesses
9. “International Ecommerce Issues: How to Diagnose Global Barriers with Analytics,” Shopify; https://www.shopify.com/enterprise/international-ecommerce-issues
10. Ibid.
11. Ibid.
12. “E-Commerce Localization,” Milengo; https://www.milengo.com/e-commerce-localization
13. “The Complexities Of International Checkout for eCommerce Merchants,” Floship; https://www.floship.com/how-to-equip-yourself-to-handle-the-complexities-of-international-checkout
14. “How to drive cross-border e-commerce growth,” Paysafe; https://www.paysafe.com/blog/how-to-drive-cross-border-e-commerce-growth

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