Cross-border e-commerce is expected to exceed 3 billion consumers and $300 billion by 2018; but to seize this opportunity, retailers must formulate strategies that meet the needs of global shoppers.
The key to success in cross-border e-commerce is to make the experience feel local to customers, said Rick Barbari, group VP of Digital River World Payments, which recently launched "The X-Border Payments Optimization Index" with PYMNTS. The index measures how prepared merchants are to conduct cross-border e-commerce.
"No matter how successful you are at home, enabling global customers to buy products and services requires more than simply reproducing your domestic shopping site in another country's domain," Barbari told FierceRetailIT. "It means making your customers feel at home, wherever they are, with a retail experience that's familiar, accessible, and convenient in an online shopping environment."
The best practices identified by the index are dependent on IT capabilities, specifically the top-to-bottom global commerce engineering that Digital River calls "commerce business infrastructure."
"Serving the right local language and accurate local currency prices to every customer, every time, demands not only nimble, but also advanced localization measures on the back end," Barbari said. "Streamlining the checkout process takes not only thoughtful user experience design but also, and crucially, tax calculation, reporting and fraud protection measures tailored to fit the legal and regulatory frameworks of every country where you sell.
"Every aspect of cross-border digital retail depends on the effectiveness of the IT leadership and execution behind the scenes."
The index is designed to help merchants improve their global online presence in two ways. First, the index isolates and identifies specific factors that most significantly influence the ease of cross-border shopping, and enable retailers to direct their efforts where they matter most. Second, it lets retail IT leaders benchmark their own cross-border efforts against those of their peers to gauge their performance and set meaningful goals. "And the index shows that there's plenty of room for improvement," Barbari said.
Recommendations from the index are as follows:
Speak the language. The Index shows that a startling number of global retailers offer their global commerce websites in only one language. Highly optimized sites present broad language options, some allowing users to select from over 20 languages.
Price it right. "If you walk into a store and encounter prices in an unfamiliar currency, you won't know how much items will cost you. The same is true online—the prices your customers encounter should be instantly meaningful to them, in the currency they're most comfortable using," Barbari said.
Take the money. No matter how well-designed, the success of an e-commerce experience comes down to sales. "To make a sale, you have to be able to accept the payment methods that your customers want to use," Barbari said. Payment methods can vary dramatically from country to country. He furthered warned, "Cross-border shoppers will abandon an online shopping cart, quickly and without looking back, if they find they can't use a payment method they're comfortable with at checkout."
Help quickly. Shopping across national borders can be intimidating for consumers, even in the friendliest e-commerce environments. This is why the best cross-border retail experiences offer quick, easy access to practical help with customers' most frequent questions.
Reduce friction. What's true of domestic ecommerce doubles across national lines—the experience that sells is the experience that reduces friction for customers. Friction matters particularly in the checkout flow, and the index report shows cross-border retailers vary widely in the ease in which they speed customers through the process. "The friendliest sites we tested allow users to check out in only five pages and the worst take a dozen, or even more," Barbari said.
With insights from "The X-Border Payments Optimization Index," online merchants can more effectively focus their IT resources on the elements of global retail that matter most. "We want retailers to have the IT infrastructure and cross-border savvy necessary to create online shopping experiences that sell effectively to customers all over the world," Barbari said. "The index provides advice on how you can take steps to do that."
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