eCommerce has long been an established giant in retail, the trends of which have clearly crystallized and are currently consolidating. Nevertheless, eCommerce is currently experiencing a revolution, according to a study published by the parcel service DHL Express: Customers are purchasing increasingly abroad. The signs are looking good for international eCommerce, with every seventh online purchase crossing at least one national border. DHL Express sees in international eCommerce the greatest growth potential for retail.
International eCommerce is growing twice as fast as nationally
The study predicts an average annual growth of 25 percent in the volume of international eCommerce between 2015 and 2020. Expressed in dollars, this means that when the 2015 volume amounted to 300 billion US dollars, the 2020 value should then come to ca. 900 billion dollars. International eCommerce is thus growing at twice the speed of domestic eCommerce markets. Decisive for customers are more attractive offers compared to domestic shops, a higher product availability and an existing trust in the brands and shops.
DHL makes clear that entry into international eCommerce is no major obstacle to retailers and manufacturers. Growth through a worldwide offering proceeds fast and efficiently, with retailers and manufacturers who sell their products internationally registering an average growth of 10 to 15 percent in their sales. The sale value of every fifth order amounts to over 200 US dollars. To enjoy success at international level, retailers and manufacturers should undergo five steps:
- Develop an international eCommerce strategy and work out the business opportunities clearly
- Arrange the product line according to local preferences and practices
- Adjust the online shop to the country of the end user (language, payment options etc.)
- Find the right logistics infrastructure for your company
- The ideal shipping options for international sales
Higher growth dynamic through premium offers
The last point of these five steps will be the most important and the most difficult: The e-tailers surveyed in the study who are not represented in international eCommerce named logistics as the biggest hurdle to a worldwide offering. DHL recommends in its study the solution of offering a premium shipping option, besides the standard one. In their survey of 1,800 e-tailers worldwide, it transpired that retailers and manufacturers with premium shipping offers grew 1.6 times faster than competitors without a comparable offer. International purchases are often associated with an emotional occasion (Christmas, birthdays, St Valentine’s Day) where the customer is prepared to pay extra for faster delivery.
It is not only amidst premium services that DHL sees advantages for retailers and manufacturers, but also amongst premium articles in general:
“We see that virtually every product category has the potential to upgrade to premium. Both by developing higher quality luxury editions and by offering superior levels of service quality to meet the demands of less price-sensitive customers”. – Ken Allen, CEO of DHL Express
Market transparency is a decisive factor
As the study shows, retailers and manufacturers are faced with the challenge of securing a long-term competitive advantage through pricing. They require a well thought-through pricing strategy to challenge the top players in international eCommerce. Online retailers have to react dynamically to the market and remain in sight of what competitors are doing. For fast and effective price and market monitoring, price optimisation and product range analysis, automated tools like the blackbee Business Intelligence software have become indispensible. Without these, competitors are afforded advantages on the market.
To successfully participate in the revolution underway in eCommerce, a transparent market for you as retailer or manufacturer is essential. With blackbee, you are ideally equipped for international eCommerce, since our software is worldwide and language independently deployable.
Are you interested in further developments in international eCommerce? Stay informed with our newsletter!