Cross-border sales have opened the door to a world of opportunity and e-commerce companies are eager to storm through. The expansion of international sales is not only a key growth driver for online businesses, but more essential than ever to their bottom line.
Right now, cross- border transactions are becoming increasingly prevalent. In fact, 87% of merchants believe that expanding online sales into new markets is one of their company’s biggest growth opportunities, according to new research in the Visa Global Merchant eCommerce Study (Visa GME Study), which looked at responses from 1,000 C-level executives from 10 major global markets.
As technology pushes the pace of innovation even faster, seemingly anyone in retail can seize the opportunity to become more relevant to potential buyers across the globe, notes the report. Yet while the explosive rise of cross-border digital commerce has opened the door to a wealth of new opportunities, many businesses are struggling with sales strategies, logistics and more.
Small businesses in particular face significant difficulties when it comes to global e-commerce. No two retailers, regions or consumers are the same, so it is critical that merchants understand the landscape.
This report is aimed at taking the global pulse of businesses of all sizes. It looks at trends, insights and pain points around cross-border e-commerce in order to gain a more comprehensive understanding of why merchants see international sales as critical to long-term success, what customers want from online shopping experiences and the key barriers to expansion.
Helping merchants succeed means helping them connect the dots from where they are to where they want to be, says the report, and fine-tune their efforts to attract international customers.
The fundamentals of completing a sale — most often a simple task, domestically — can become complicated in an international transaction due to factors such as exchange rates and taxes. While almost four in five (79%) claim that their company is prepared to handle international transactions today, only 35% say that their company is adequately equipped to do so on a regular basis and with sustained success.
Consumers increasingly are looking to shop across borders in search of better prices, better quality and goods that are not available in their market. That has led 2 in 3 (66%) e-commerce companies to sell products across borders. Those sales alone account for nearly a third (31%) of their revenue on average.
Rising Customer Expectations
The physical distances are greater, but businesses recognise that international customers want service that matches what their domestic customers receive. Quick delivery of product or service is believed to be the most important factor in successfully executing international sales (44%), followed by easy checkout (41%) and convenient payment methods (41%).
Ready or Not
Businesses must be prepared to overcome numerous process hurdles to enter international markets. When it comes to managing online transactions, executives are prepared for accounting for handling of taxes (52%), payment processing infrastructure (52%) and international shipping and handling (52%). But they are less prepared for international customer support (47%) and legal compliance (43%). In all cases, executives see room for improvement in these critical areas.