By Mr. Ankur Dayal, Co-Founder – Primarc Pecan
Cross-border e-commerce is quickly becoming a necessary component of building and scaling an online business. After years of establishing their e-commerce business in a regional or national market, brands have begun to consider extending into other nations. Cross-border e-commerce sales have soared in recent years as a result of increased demand for foreign goods and a growing middle-class population, notably in Asia-Pacific (APAC) countries.
In India, e-commerce has swiftly grown to provide a new context for how businesses are conducted and brands are conceived and positioned. The pandemic has boosted e-commerce in India and around the world, with the market predicted to reach $98.4 billion by 2023. Global cross-border e-commerce is quickly becoming the next significant growth potential for Indian B2C companies. Clothing and footwear are the most popular cross-border online shopping product categories worldwide, according to a Statista poll conducted in August 2021. Moreover, half of those polled said they would consider ordering these things from abroad. Sport, hobbies, and leisure were the second most popular category among internet shoppers, accounting for 44% of those polled.
The increase in digital access has made it easier for customers all over the world to buy goods from other nations. This, combined with free trade, robust logistics, and more payment methods, has made it simpler for people all over the world to buy goods from other countries. The growing popularity of cell phones has created new markets for foreign companies. According to Forrester, cross-border purchases globally will account for 20% of all global e-commerce in 2022. According to the same data, cross-border sales currently total$627 billion.
So, why is cross-border e-commerce important for any company in the business? According to Internet Retailing, cross-border e-commerce is expected to hit the US $ 2.1 trillion mark by 2023, up from US $ 1.9 trillion in 2022. Some of the causes that have contributed to this 13% growth include the enormous popularity of cross-border sales as an e-commerce channel and the increasing success of marketplaces. The pandemic has increased e-commerce income in both emerging and developed nations around the world. Ninety percent of e-commerce leaders surveyed by Visa believe that their company’s success by 2024 will depend on having a global, cross-border presence.
All of these signs point to a tremendous but unmet opportunity for growth in international selling. For brands that haven’t already begun selling in overseas markets, now is the time. E-commerce spending in foreign nations is increasing as access to and demand for internet-enabled devices increases, and some countries encourage globalization and international trade. All this makes it an opportune moment for brands to go global.
Driving the demand for cross-border e-commerce is that more individuals are becoming able to make online purchases. Technological and financial empowerment, along with the possibility to achieve reasonable prices on things that may not even be available locally is drawing an increasing number of new customers. Areas, where alternatives were previously very limited, are now witnessing unprecedented levels of choice. Shoppers aren’t simply going online to find the same items that are already available to them but are looking for imported products that were previously only available to a select few.
Expansion is the mantra
Comprehensive research and strategizing of worldwide markets are critical to a successful international expansion strategy. Identifying the primary market, and analysing market trends and dynamics will help understand the target demographic because convincing local clients is not always easy. Engaging with clients and presenting websites, photos, infographics, and newsletters in their native language will help develop trust and connection with the business.
Planning ahead of time is sure to assist brands in avoiding unexpected complications while having a knowledgeable local partner will aid in understanding the taxation, customs, carrier costs, and shipping in each destination country better. The total landed cost, is critical information to both the retailer and the customer. Customers detest unexpected costs and being completely clear and upfront about expenses will help them determine the ultimate price and when to expect delivery. Detailing various shipping options, expected arrival dates, fee break up, and final costs upfront will bring in confidence and ensure that a recurring, long-term customer base is created as cross-border e-commerce grows from strength to strength.