More people are shopping on their devices than ever before. It’s not only good for customers who value convenience and variety — it also gives retailers the opportunity to expand on a global level and participate in international eCommerce.
“Selling internationally opens up a whole new category of global shoppers that retailers can tap into,” says Brennan Loh, director of international at Shopify, a multichannel platform that allows merchants to sell their products online, across multiple sales channels, and in person. He says international is the company’s fastest-growing segment to date.
Given the explosive growth of eCommerce over the past decade, international sales are expected to surge as more executives see the value in shipping their products abroad. According to one study, retail cross-border eCommerce sales are poised to exceed
$900 billion by 2020.
Visa’s recent "Global Merchant eCommerce" survey, which looked at responses from 1,000 C-level executives from 10 major global markets, shows today’s executives are getting on board with this strategy: 87% of the merchants surveyed believe expanding online sales internationally is one of their company’s biggest growth opportunities.
If done right, accepting cross-border eCommerce payments can help companies grow, create new customer relationships, and present fresh opportunities for businesses.
Retail goes beyond borders
In an overly saturated retail environment, the pressure is on for merchants to give consumers a quick, secure, and convenient checkout experience — no matter where they are.
International expansion helps businesses reach more consumers
One of the many benefits of selling internationally is the potential for growth.
According to Visa’s survey, 88% of respondents say they believe that having an international presence will be essential for their company’s success in the next five years. It also found that 66% of eCommerce companies that responded sell products across borders — accounting for nearly one-third of their revenue, on average.
"For companies of any size, there is a huge opportunity to expand to new global markets," said Suzan Kereere, global head of merchant sales and acquiring at Visa.“ Whether through physical store or digital sales, it opens doors to new customers and different revenue streams.
Shopify reports that about 372,000 small businesses with less than $2.5 million in revenue generated more than $4 billion in international sales on the platform in 2018. It accounted for 20% of all international sales that year, Loh says, adding that the company has over 1 million customers, with hundreds of thousands of merchants across Europe and Asia.
Key benefits of expanding online sales internationally cited by respondents:
Increased
brand awareness
+
+
Expanded
customer base
+
improved
brand reputation
+
expansion of
product or
service lines
+
Increased
Competitive advantage
+
Increased
Market Share
Increased
brand awareness
Expanded
customer base
improved
brand reputation
expansion of
product or
service lines
Increased
Market Share
Increased
Competitive advantage
- The Visa “Global Merchant eCommerce” study, 2019
Retailers have to build customer relationships across borders
While expanding into the international market is an exciting opportunity, retailers need to keep the customer experience top of mind. Loh says businesses should consider things like their shoppers’ preferred language, buying habits like device preference and mobile or desktop, as well as popular local payment methods.
“When it comes to selling internationally, there is no one-size-fits-all solution, and that’s why product market fit is so important,” he says.
Shopify, which collaborates with Visa, provides out-of-the-box solutions like payments, shipping and fulfillment, marketing, and cross-border selling tools. Loh says the company tries to make the process easier by allowing merchants to sell in several currencies while getting paid in their local currency through Shopify Payments and translation APIs. This way, merchants can provide more localized buyer experiences for international shopping.
READ MORE
Providing this kind of customer service helps build brand loyalty, which is important no matter how much distance is between the consumer and retailer. Merchants also have to be able to respond to the market.
“Our partners are best equipped to solve important localization features requested by our merchants given proximity and context,” Loh says. “This allows us to offer purpose-built apps for those markets. We are also focused on investing in key products that are locally relevant.”
Kereere says merchants should keep in mind that no two retailers, regions, or consumers are the same.
“Merchants need to understand who their current and prospective customers are and where they are coming from, then tailor their value proposition to those specific needs,” she says. “The right financial partner can help them do this.”
46%
Increased
brand awareness
+
Expanded
customer base
46%
+
+
+
+
+
improved
brand reputation
44%
expansion of
product or
service lines
43%
42%
Increased
Market Share
Increased
Competitive advantage
40%
The majority of customers expect a standard experience when they shop online, no matter where they are. This includes a seamless checkout experience, quick delivery, and convenient and secure payment methods. Unexpected costs related to taxes and duties can also deter consumers from buying from an international retailer, according to Loh. These expectations can present barriers to entry that many companies are still navigating.
“The data is clear — cross-border is a major growth opportunity,” Kereere says. “But it’s not easy, especially for small businesses.”
While nearly four in five executives say their companies are prepared to handle international transactions today, only 35% say their companies are very well prepared to do so, according to McKinsey & Co.’s “Global Payments” report.
Between understanding the climate of each foreign market, calculating taxes, exchange rates, and facilitating between international banks and consumers, it gets challenging for companies of all sizes — especially businesses with limited resources.
Overcoming challenges to meeting customer expectations in foreign markets
What’s keeping executives from trying to break into foreign markets?
42%
Shipping & logistics issues
- The Visa “Global Merchant eCommerce” study, 2019
Difficulty accepting and processing foreign transactions
37%
39% of small businesses executives are more likely to say their company is not prepared for international transactions, compared to 7% of large businesses.
The Visa “Global Merchant” survey, 2019
In the US, (and soon to be rolled out to additional markets), Visa makes the process more seamless with the new click to pay experience, supporting EMVCo’s Secure Remote Commerce, a set of industry specifications related to online transactions, to make online checkout experiences easy, smart, and secure — whether you’re shopping on a computer, smartphone, tablet, or other connected devices. This helps standardize the experience for small and large businesses alike. Transactions made through the click to pay experience with Visa can benefit from the security of the Visa Token Service, technology that replaces sensitive payment information with a unique identifier, or “token,” protecting the underlying sensitive payment information and reducing payment flow friction.
Extending payments beyond borders with the help of technological advancements allows businesses of all sizes grow into new territories, generate brand awareness, and even improve their bottom line, with the help of companies like Visa.
“As a global platform that sees millions of transactions daily, Visa helps merchants find new customers, verify their customers’ digital identities, and create secure, seamless experiences,” Visa’s Kereere says.
Find out more about how Visa is helping companies expand their payment capabilities internationally.
This post is sponsored by Visa in proud partnership with Shopify
The Visa “Global Merchant” survey, 2019
The EMV® SRC payment icon is a trademark owned by and used with permission of EMVCo, LLC.
Sponsor content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Business Insider's editorial staff is not involved in the creation of this content.
Copyright © 2020 Insider Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our
Terms of Service, Privacy Policy and Cookies Policy.
Disclaimer | Commerce Policy | CA Privacy Rights | Made in NYC | Reprints & Permissions
Legal and trade issues
33%
Limited marketing resources
33%
Increased
brand awareness
Expanded
customer base
improved
brand reputation
expansion of
product or
service lines
Increased
Market Share
Increased
Competitive advantage
Providing this kind of customer service helps build brand loyalty, which is important no matter how much distance is between the consumer and retailer. Merchants also have to be able to respond to the market.
“Our partners are best equipped to solve important localization features requested by our merchants given proximity and context,” Loh says. “This allows us to offer purpose-built apps for those markets. We are also focused on investing in key products that are locally relevant.”
Kereere says merchants should keep in mind that no two retailers, regions, or consumers are the same.
“Merchants need to understand who their current and prospective customers are and where they are coming from, then tailor their value proposition to those specific needs,” she says. “The right financial partner can help them do this.”
This post is sponsored by Visa in proud partnership with Shopify
The Visa “Global Merchant” survey, 2019
The EMV® SRC payment icon is a trademark owned by and used with permission of EMVCo, LLC.
Sponsor content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Business Insider's editorial staff is not involved in the creation of this content.
Copyright © 2020 Insider Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our
Terms of Service, Privacy Policy and Cookies Policy.
Disclaimer | Commerce Policy | CA Privacy Rights | Made in NYC | Reprints & Permissions
This post is sponsored by
in proud partnership with
