Every day more and more people worldwide gain internet access, and even those in the most seemingly remote areas are doing their shopping online.
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 goldmine.
It should come as no surprise that ecommerce sales worldwide are forecasted to hit $2.5 trillion in sales by 2018. That wondrous news should perk the ears of any entrepreneur looking to launch an ecommerce based business.
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, I’ll go over all preliminary steps you’ll need to take to play in the big leagues and sell abroad like the best of them.
1) First Local, Then Global
You gotta crawl before you can walk.
As 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.
2) 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. If anything, this is your foot in the door to get eyeballs on your business.
Check out these resources to help you conduct international market research into an area you’re targeting.
3) Consider Each Market’s Preferred Payment Method
At this point, you’ll want to take into account how you want to be paid. You might be under the assumption 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.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.
That’s why, when selling internationally, you’ll do well to offer a variety of payment options.
4) Keep Tabs On International Regulations
Perhaps the most tedious part of selling online is staying up to date on the latest trade regulations per country.
International trade regulations may vary greatly from country to country. Never put your business in harm’s way by going in blind. Once you’ve decided on a particular country to focus your efforts on, do some digging on the following:
- Duties and taxes
- Free-trade agreements
- Banned products
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)
Check out the resources below to research accurate and up-to-date regulations that may affect doing business abroad.
- http://www.commerce.gov/ (US)
- http://www.chamber.ca/ (Canada)
- http://www.fairtrading.nsw.gov.au/ (AUS)
5) 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 shop and 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.
6) Support International Currency
Consumers are fickle by nature — especially when out of their comfort zone.
Similar to offering various payment methods, customers from another country will be less reluctant to buy from you if they’re able to pay in their native currency. Besides, nobody has the patience to do the math in their heads or research the current exchange rate.
This circles back around to delivering a great customer experience. Thankfully, currency exchange can be handled completely by procuring a global payment gateway. See the next section.
7) Procure a Global Payment Gateway
If you’re going to take payments from international customers, you need a global payment gateway, period.
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 for fraud and purchase disputes.
Remember, some countries prefer to pay using specific payment gateways over others. Research your target market to find out what those are.
8) Capitalize on Global Marketing Opportunities
Black Friday and Cyber Monday are the two biggest North American shopping days of the year — no contest. 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 sales opportunities for your business. Go beyond Black Friday.
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 $14.3 million dollars in sales in 2015 as a result of smart marketing.
There’s a whole world out there, and each country has its own national shopping holidays.
Familiarizing yourself with the markets in the countries you’re targeting will serve your bottom line well — one of the many benefits of expanding to an international market.
9) 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.
Now get out there and sell. The world is your oyster.