Every day more people worldwide gain internet access, and even those in the most seemingly remote areas are doing their shopping online. It should come as no surprise that ecommerce sales worldwide hit $2.3 trillion last year alone.
Many small businesses have already claimed a stake in these high-potential overseas markets — and with an airtight entry plan, you can can be among them. Whether you’re selling hand-crocheted winter beanies or 1-on-1 investment advice, if you’re a small business selling online you’re sitting on a potential gold mine.
A word of caution, however: Catering to customers around the world brings with it a new set of hurdles to clear and strategies to master. In this post, we’ll go over all preliminary steps you’ll need to take to sell abroad.
First Local, Then Global
If you’re a relatively small (or one-person) operation, there’s good reason to limit your international marketing efforts to a few select countries. Not only will it allow you to really get a handle on your overseas markets, but it can help you establish a competitive pricing structure.
Start by conquering your home country or niche several months before. Work out the kinks in your customer experience, and allow ample time for gathering feedback. After that, following your market research (below), strategically focus your efforts on one country or region in which you’re projected to succeed, and scale as needed to meet international demand. Master selling to that market before moving on.
Find Your Global Market
Before launching a product or business abroad, do your homework. Conduct some market research into any country/region to which you wish to expand. Three important questions you’ll need to answer are:
- Will my product appeal to citizens of that country/region?
- Is there a hole in the market I’m able to fill?
- What’s my competitive advantage in the foreign economy?
Just as you’ve likely done your due diligence in gauging the pain points and wants of your local customers, so must you acquaint yourself with your international customers — country by country. Avoid dumping time and resources into places where your product won’t resonate with people or could fail to catch on.
If you’ve noticed that customers abroad are already buying from you, do your best to figure out where the majority of your international sales hail from. Which country outside your homeland is buying up the bulk of your products worldwide? From there, do a quick risk assessment. Take into account cultural and economic standing as well as likelihood of fraud.
Finally, you’ll need to calculate and allocate a budget for marketing your products and services to your new international market segment.
Check out these resources to help you conduct international market research in an area you’re targeting.
Consider Each Market’s Preferred Payment Method
Many business owners assume that all online payments are handled via credit card as they are in North America, Australia or Canada, but the variance is far greater. For instance, 50% of Germans use bank transfers as their preferred payment method while China almost exclusively uses Alipay, an international online payment platform akin to PayPal.
That’s why, when selling internationally, you’ll do well to offer a variety of payment options. Here are the preferred payment methods by country:
- Australia: Credit Card
- Canada: Credit Card
- China: Alipay
- France: Debit
- Germany: Online Bank Transfer
- Japan: Credit Card
- South Korea: Credit Card
- UK: Debit
- USA: Credit Card
Consider this: If you were purchasing a foreign product, wouldn’t you be less inclined to buy if your preferred payment method weren’t an option? Not only would it be inconvenient, but you’d question the security of your transaction. Instilling trust and comfort is a must when appealing to foreign customers. After all, checkout is the number one point at which international shoppers abandoned a purchase.
Keep Tabs on International Regulations
Perhaps the most tedious part of selling online is staying up to date on the latest trade regulations. International trade regulations may vary greatly from country to country, so once you’ve decided on a particular country to focus your efforts on, it’s important to do some digging on the following:
Check out the resources below to research accurate and up-to-date regulations that may affect doing business abroad.
TIP: If you’re a U.S.-based business, consider branching out to regions such as Central America. Free trade agreements such as the Central America Free Trade Agreement (CAFTA) make international business safer and easier than ever.
Make Your Site International-Friendly
It may seem like a no-brainer, but to deliver a remarkable experience — the essence of any emerging business — you need to accommodate internationals on your website.
Allow your shoppers to browse your site in their native language or a language familiar to them. The more comfortable they are in their shopping experience, the more likely they are to buy from you.
Use localization services (below) to implement some important functionality into your website. Simply adding a language drop-down makes a world of difference. Be sure to choose one that not only auto-translates everything on your page, but one which converts date formats and addresses. The best services available factor in cultural variations and displayed currency.
One other thing to keep in mind when making your site international-friendly: It helps to educate yourself on any cultural nuances and differences. This way you can avoid any taboos or faux pas in your website copy and imagery.
Procure a Global Payment Gateway and Support International Currency
If you’re going to take payments from international customers, you need a global payment gateway.
Designed for handling high-volume sales, payment gateways are cost-effective solutions designed to handle all international purchases and the majority of world currencies. Most integrate easily with any CRM or ecommerce platform. They also offer safeguards against fraud and purchase disputes.
Here are some common gateways:
Additionally, similar to offering various payment methods, customers from other countries will be less reluctant to buy from you if they’re able to pay in their native currency. This also makes it more convenient for them — they don’t need to do the math or research the current exchange rate. Thankfully, currency exchange can be handled completely by procuring a global payment gateway.
Capitalize on Global Marketing Opportunities
Black Friday and Cyber Monday are the two biggest North American shopping days of the year. What if you weren’t limited to those two national holidays for a spike in sales?
Branching out to an international market opens up tremendous holiday sales opportunities for your business. In India for instance, Diwali trumps all other shopping days. The Hindu celebration draws millions in sales of jewelry, electronics, and confectionery every year. Meanwhile Singles Day in China — a celebration of being single and spoiling oneself for the day — continues to break annual sales records each year in electronics and consumer goods. China-based Alibaba netted $5.99 million in sales in 2017 as a result of smart marketing.
Familiarizing yourself with the markets in the countries you’re targeting will serve your bottom line well.
Sort Out International Shipping (If Selling Physical Goods)
For businesses selling physical products (as opposed to digital products), you’ll want to investigate the cost, speed, and reliability of shipping services to any countries or regions you’re targeting.
For a list of reliable international carriers to choose from, as well as their rates, visit this page. A shipping calculator such as this will help you estimate your shipping costs to any given country.
If you happen to be shipping products locally, employ the same best practices for international shipping. For example, as an international vendor you must set clear delivery expectations. The shipping duration for international packages is longer. List delivery estimates on your website where they are clearly visible to avoid confusion.
Above all else, be sure that your profit margin from selling abroad covers your “landed cost.” That’s the total cost it will take for your product to reach its final destination: the customer’s doorstep.