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WORLD DOMINATION:
A 10-step plan for global eCommerce
eCommera’s clients across the globe.
www.ecommera.com
In 2015, worldwide online sales are expected to increase nearly 21% to £1.04 trillion and eCommerce is
expected to account for 6.7% of all retail sales around the world1.
Consumers in Asia-Pacific spent more online than other counterparts worldwide last year, making this region
the largest eCommerce market in the world. Leading growth in Asia-Pacific are China, India and Indonesia.
Brazil and Russia are also among the countries expected to drive eCommerce sales growth worldwide.
Retail is increasingly global and retailers who want to grow their business often go after opportunities in new markets.
The path to internationalisation usually follows this pattern:
Rise in the volume of traffic
from new markets
Offering international
shipping
Addition of currency
options
Full localisation
Growth in sales from franchise
partners or physical stores
But just following this path without a clear plan or clear goals isn’t enough. To be successful, you must take a more considered approach, conduct thorough research into the market and develop an end-to-end operational plan.
To help you in your international quest, we have mapped out 10 key steps you need to take when considering your expansion strategy.
1 eMarketer, Retail Sales Worldwide Will Top $22 Trillion This Year (December 2014).
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Adapt your proposition to suit the market
The consumer proposition is the mix of product, price, availability, service and customer experience.
Do not assume that you can transport your existing proposition into new markets. Find out what matters to consumers in the
market and understand the local competition:
• What are expectations around price?
• Is your proposition unique?
• Why would consumers buy from you instead of a local trusted brand?
In order to test the Chinese market, luxury retailer Neiman Marcus acquired partial ownership in a Chinese fashion website. This allowed
them to learn more about Chinese consumers’ likes and dislikes before making the investment to launch their own website in China.
2
Turn your vision into an operational plan
Having a clear goal in mind will help justify the cost of expansion into a new market.
Your goal should be based on understanding customer acquisition and retention – the fundamental drivers of growth. Set realistic
online goals to avoid over-investing, by separately modelling customers, categories and channels.
Too many retailers still plan based on simplistic outcomes, such as average order value, traffic and conversion, which are easy to
model but generally don’t materialise. Your goal should be based on local market data, not domestic data.
Think like a start-up. You may have little brand awareness in the new market, which means that your customer acquisition costs
could be higher than you are used to, while your conversion and repeat purchase will be lower than at home.
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3
Place:
Localise your website
The challenge of international websites is to reflect subtle local differences. A single global template is cheaper and ensures a
consistent look and feel. However, there are many local and cultural differences that need to be considered as trade-offs:
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Is personalisation expected or is a lack of privacy off-putting?
Should promotional messages be subtle or aggressive?
Should fashion models be local or international?
Is broadband ubiquitous?
Will consumers browse on mobile devices or PCs?
Are there any seasonal differences?
Be sure to work closely with your regional team or a local agency on this. Getting it wrong could be the difference between
achieving your goal and lacklustre results.
4
Select the right technology partner
Your eCommerce platform forms the hub of your technology. Picking the right partner is essential to support your
international ambitions. Here are some considerations when selecting your SI partner:
• How many markets have they launched clients in?
• How well do they understand retail?
• Do they have relationships with relevant third-parties in each market?
• How quickly can they launch a new site?
• How flexible are they? Do they have local development teams?
• Can they help you with strategy and planning?
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5
People:
Organise your team
Getting the right people and organisational structure is more difficult than it sounds. Talented people are difficult to find, especially in
immature eCommerce markets. Moreover, it is imperative to get the eCommerce organisation to scale as revenue grows. There is a
delicate balance between the expense of building an organisation ahead of sales versus growing incrementally and playing constant
catch-up. Retailers also need to balance which functions are managed in-house, which to outsource, and how that will change over time.
The first people challenge is to determine what can be done ‘once’ globally, and what needs to be done locally by market.
The second challenge is whether to physically locate people in each market, or manage everything from a central base. Planning for
flexibility is the key to success.
We have seen brands with nascent eCommerce revenue incorporate existing local brand / marketing expertise in every market into
the “eCommerce team”. At the opposite extreme, for retailers with no local presence, we have seen operations run entirely centrally,
with the hire of local marketing support through agencies when required.
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Promotion:
Build a reputation
Customer acquisition is achieved by building brand awareness through a wide range of channels, including paid search, affiliates,
and social media and retargeting.
Be creative about building brand awareness using local events and PR. Traditional domestic focused on ‘closing’ channels such
as paid search, affiliation and shopping engines, will not build sufficient brand awareness in a new country. The trick is to get the
balance right.
Topshop managed to build its reputation in the US thanks to strong PR, a tailored US website, the launch of a single flagship store
and an exclusive partnership with Nordstrom. ASOS made great use of social media to market itself, offer customer service and
build a strong base of followers. They also headlined the annual Vogue Fashion’s Night Out block party, NYC, with an exclusive
fashion show and branded t-shirt giveaways.
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Planogram:
Merchandise by market
Managing site navigation to unite customers with SKU, through the site’s taxonomy, facets, sort orders and product
recommendations, also known as planogram, is another international challenge. The key is to balance global simplicity
with local optimisation by developing a set of global rules, and then localise where necessary.
The extent of global variations affecting customers, such as the seasons, the weather, and the optimal timing of sales
requires a localised planogram. Promoting your winter line globally won’t inspire customers in the southern hemisphere
any more than offering a global Singles’ Day promotion, a Chinese event, in November will confuse your customers in the
rest of the World. One size definitely will not fit all.
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Build out your local customer promise
Taking an order online necessitates making a ‘promise’ to customers on when they should expect to receive their goods.
Delivering on that promise internationally requires managing fraud screening, payment, picking, packing, shipping and
customer service.
• Fraud. Many markets do not have online address files, so new approaches become critical. The extent of the issue is
huge – one major UK retailer reported that approximately 50 percent of transactions in Europe were attempted fraud.
• Optimal international delivery. This is a delicate trade-off between fast, tracked and expensive versus slow, untracked
and cheap. There are also critical decisions about when and where to site local warehouses (if at all). Local stock is
typically a trade-off of delivery time and cost versus the simplicity and efficiency of having all stock in a single location.
• Local returns address. Deciding when and if to have a local return address and at what point during the returns
process you refund the customer are important considerations.
• Customer service model. There are myriad choices from which languages to use, what time zones to cover and
whether to offer a telephone service.
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9
Adapt and implement new processes
There are over a hundred processes required to make online retail work well. It is very common to encounter some of
the following growing pains in eCommerce alone;
• Stock-in-warehouse-but-not-online due to buying processes which neglect consideration of content and imagery
until the last stage
• Lost sales from out-of-stock online despite in-stock in store, driven by ring-fenced stock
• High returns on given lines due to poor imagery, unclear material description or poor sizing
In looking at international, consider how processes need to be adapted to accommodate:
• Provision of contact centre in language and hours suited to end customer
• Ensuring daily “last shipment” meets local market promise given time difference and selected partner
• Handling of fraud rules through payment partner. Non-domestic transactions on high value items can be “held” or “cancelled” for reasons which could be mitigated
• Processing of non-Roman character contact and address details in delivery and billing forms into pick-and-pack notes
• Providing customers with a returns process appropriate to the market
• Handling of cash on delivery (COD)
10
Performance: Measure success
eCommerce is data-rich but often information-poor. It is paramount to track profit-centric outcomes, with a wide range
of input measures that drive action.
The performance of each market should be assessed separately. The dynamics of international markets are so different
that setting the right benchmarks and evaluating success is difficult. International averages are some of the most
meaningless numbers you will find in an eCommerce business!
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Our Expertise
Our 10P’s of internationalisation is a framework that covers every aspect of what it takes to deploy or expand your eCommerce business and make
it profitable – from “proposition” to “people” to processes” and beyond.
Our specialist retail consultants can work with you to help identify the right markets for expansion and to build out a comprehensive operational
plan complete with a P&L per market – so that your path to international is a successful one.
How we support our clients’ international ambitions
Tempur recognised the power of the online channel in supporting
their international network of retailers as well as driving direct sales.
As a global brand, known all over the world for their famous NASAinspired mattresses and pillows, Tempur needed a truly international
digital presence.
eCommera worked with Tempur to launch 32 sites across 26 markets covering all corners of the globe – from Japan to Finland to Brazil to Australia.
Internationally-renowned cosmetics and beauty group, Clarins,
planned an ambitious digital roadmap that included international web
and mobile stores for its luxury beauty brands.
eCommera helped the brand to launch 48 sites. The fully-responsive
sites gave Clarins Group a digital presence across 17 markets –
including China, where Clarins became the first customer to launch
on the local Demandware realm.
About us
We provide global retailers with a ‘one-stop shop’ for expertise, technology and operational support. We are passionate about retail and that
permeates everything that we do. Whether we are helping clients like Jimmy Choo develop an international strategy, working with Clarins to launch
sites in over 25 markets or putting our heads together with the team at Asda-Walmart to realise their next innovation.
eCommera has on-boarded and maintains 25 brands with more than 170 sites across 30+ countries, including two of the top five Demandware
sites globally. We have a wealth of experience in driving the most value from the Demandware platform according to individual business objectives.
Learn more at www.ecommera.com
Conquer the world
Contact Richard Price today to find out how we can help:
Direct: +44 203 530 5813
Email: [email protected]