Zonal pricing, local warehouses and addressing issues such as data security and ease of returns will be crucial for retailers to seize the “huge opportunity” for growing cross-border ecommerce sales over the next three years.
The world’s largest ecommerce markets - the UK, the US, China and Germany - are expected to double in size to £645bn in 2018, according to research from OC&C Strategy Consultants, PayPal and Google.
The UK is the most popular online overseas destination for German shoppers, and the second most popular for both Chinese and US consumers.
Chinese and German shoppers also respectively spend on average 2.7 and 1.7 times more per transaction than their UK counterparts. The research, which will be presented at the British Retail Consortium’s Annual International Conference on June 11, found Chinese shoppers buy from UK retailers online almost as frequently as domestic shoppers do.
It suggests UK online retailers could be earning up to 60% more by building trust with overseas consumers, responding to their local payment preferences and installing the infrastructure to compete with their local competitors on speed.
Anita Balchandani, partner and head of UK retail at OC&C, gave the example of Asos.com, which has adopted zonal prices and invested in local warehouses, while Boden accepts PayPal to support US growth and has adapted to open invoicing in Germany, which German consumers value.
Martijn Bertisen, sales director at Google UK, said UK retailers are well positioned to take advantage of the boom in international shipping from mobile devices as UK consumers are already among the most mobile of all.
“PayPal data used in this study suggests that in fashion, for example, 59% of online transactions are already being made via mobile in the UK, compared with 45% and 24% in the US and Germany respectively,” he said.