Despite persisting language barriers among EU inhabitants, the economies throughout the EU are growing progressively closer. Not least, due to the strong will of some politicians, such as Wolfgang Schäuble (“For the future we need more Europe, not less Europe”), who are seeking a much tighter merging of ecommerce among EU member countries. And this will be achieved through the adoption of a new law – due to come into force by the end of 2013 – that will provide a huge boost to cross-border ecommerce in Europe.
As a result of this, it is very likely that ecommerce decision makers will have to seriously consider expanding their businesses on an international scale, even if they have been hesitating so far due to fiscal or legal reasons. However, anyone thinking that an internationalisation strategy is just about translating their existing website into other European languages, implementating a new Google AdWords campaign and adjusting international shipping costs, will find themselves easily outset by competitors.
In the fast growing European market one important ecommerce rule applies: investing upfront in a sophisticated internationalisation strategy will produce much higher yields in the long run. As such, there are six issues which require increased attention across the different EU states:
The importance of ecommerce
Eurostat, the Statistical Office of the European Union, reveals that the Czech Republic currently has the biggest share in total turnover in the ecommerce sector. Here, ecommerce makes up 24% of the country’s total income, in other words every fourth euro is generated via the online channel. Countries following close behind are Luxembourg, Ireland, Sweden, the UK, Hungary, Norway and Finland.
At the very bottom of the ranking are countries like Malta, Slovenia and Spain. In Spain, only 31% of individuals have made at least one online purchase in their life. Not only is the ecommerce business poorly known, but also the local infrastructure is often outdated.
Online distributors should avoid starting their expansion in countries like Spain, which demonstrates a low dedication to ecommerce, but instead focus on eastern European countries, Scandinavia or the UK.
Knowledge of the average online consumer
An essential detail of a successful market entry strategy is a detailed analysis of the average online consumer of that country. For this purpose two basic questions have to be answered. First, what is the general purchasing power of the country? And, second, how big is the need for the goods to be sold there?
Evaluation of the investment for successful expansion
Any internationalisation venture will incur substantial investment, otherwise the expansion has little chance of succeeding. At the outset of an internationalisation strategy companies should focus on one foreign country, in order to realise a sustainable and steady growth.
A lot of time-intensive and costly issues have to be considered, such as the translation of the web shop, legal reviews and possible adjustments of terms and conditions. Furthermore a new, country-specific marketing strategy has to be developed, additional services, such as client services and shipping have to be established. You might possibly even need another IT system including ERP and CRM.
Selecting appropriate product lines
After having gained the necessary information about your target market, one has to figure out the product range that best matches the specific target group. It is strongly recommended that you do a prior analysis by creating an initial catalogue and continuously monitor customer sales and browsing activity. The addition of automatic search result optimisation functionality is also a good way to help ensure your e-shop has the best chance of success.
Generating country-specific USPs
Existing marketing activities and messages might not necessarily work in your new target market. A country with low purchasing power is probably less interested in the exclusive quality of products or their permanent availability, but more in an attractive purchasing price or a coupon (discount) for the next online order. Besides, special attention has to be paid to the Unique Selling Propositions (USPs) of your competitors. If one of them offers a 24-hour delivery service, you should be able to offer at least the same. The more you get to know about the new target country and especially about its customer structure and their expectations, the better you can position yourself in the market by working out well-targeted USPs.
Creating a sustainable strategy for continuous updates of online content
In today’s fast moving times, nothing is more important than having a regularly updated webpage. For this reason, you should regularly update the content of your web shop according to local trends. Good content pages can work as a catalyst thereby accelerating the overall performance of your ecommerce portal. Be creative and keep introducing new and attractive content. It is important to present your web shop with that certain indefinable something that is steadily updated. By doing so, you provide your customers with new purchasing option and alternatives.
Keep the golden rule in mind: Buying decisions are made on an emotional basis and, according to “Consumer Neuroscience” experts, this applies to all EU citizens without exception.
By Oliver Hansert, Head of Customer Excellence at FACT-Finder.
GDPR Summit Series is a global series of GDPR events which will help marketers to prepare to meet the requirements of the GDPR ahead of May 2018 and beyond. Further information and conference details are available at http://www.gdprsummit.london/
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