23
“Early store openings should be seen as an extension of market research; the goal should be to use these to learn more about local tastes and preferences.”
themselves have to keep spinning. Te particulars of payments, fraud, and delivery – to name just three elements of the retail operation – can vary considerably between markets. Bringing third-party specialists on board can accelerate a retailer’s impact in their chosen new markets quicker than if they were having to learn and handle all these intricacies in- house, leaving the retailer free to focus on the big picture.
Gauging market entry speed
Rushing market entry to compete on price or share of voice from the outset is short-sighted and risky. While this may seem like a better option in the short-term, doing so can reduce margins and make it hard for retailers to make profits once a pricing structure has been put in place. Established players will always command advantages in a market, and it is better to build a stable presence rather than attempt to seize market share too early. Te decision to increase a presence in the new market should be taken based on online sales data; the rate and scale of localisation should always be assessed relative to costs. One retailer to have successfully gauged the pace and
scale of its international expansion is luxury homeware retailer Achica. Launched as a startup in the UK in 2010, Achica now employs 120 staff and services five European markets, with more than four million members today. As the company became more established in its European markets, it moved from exclusively UK-based distribution to adding a distribution centre on the mainland. Once a retailer has seen enough demand for a stronger
local presence, they can supplement their online sales with a physical presence in the new market. Early store openings should be seen as an extension of market research; the goal should be to use these to learn more about local tastes and preferences. Every brand and market is different, and the winners from the boom in e-commerce are going to be those that understand individual markets the best and tailor their offering accordingly.
Quick wins
Entering new markets takes time and gains are hard-earned, but there are still some things that can provide “quick wins”. An IMRG survey indicated that companies that translated their websites for local audiences recorded an average sales increase of 100 per cent. While this high growth may owe a lot to correlation, website language translation is still a cost-effective way to greatly increase your reach. As with all steps, the decision to offer a localised website should be made once sufficient demand has been established. For those with a physical store network overseas,
retailers should look to adapt their fulfilment processes and infrastructure to save costs. Establishing a distribution centre requires high up-front investment. However, shipping cross-border from a UK warehouse can be expensive and more difficult to compete with local players in terms of shipping speed. One cost-efficient way to solve this dilemma is to implement ship-from-store. By turning stores into mini distribution centres, retailers can quickly fulfil orders, reduce delivery costs, more easily manage in-store returns, and raise awareness of their physical store network.
Closing remarks
It is an exciting time to be involved in the e-commerce industry. Te rate of change we are currently experiencing is unlikely to come about again in our lifetime, and this provides a golden opportunity for retailers that have a strong product offering and the ambition to grow their business. If these retailers have the patience to keep it simple, manage complexity, and think five years ahead, the opportunity to become an international household name is very real.
Michael Kliger is Vice President International at eBay Enterprise, a leading global provider of omnichannel solutions, including commerce technologies, order management, retail operations and marketing services
Direct Commerce |
www.directcommercemagazine.com
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36