Cross-border ecommerce is a phenomenon that has gained a lot of momentum in recent years. Year over year, retailers are making more international sales and reaching more customers globally. With more than 4.66 billion active internet users worldwide, it’s easier than ever for brands to reach interested customers on the other side of the world.
Selling your products to consumers in another country brings some complications, but when you understand how to overcome them, the potential for new business—and the higher profits that come with the new business—grows exponentially.
Simply put, if you’re not selling in international countries, you’re missing out on many potential customers. So let’s dive into why cross-border ecommerce is the future of ecommerce.
What is cross-border ecommerce?
Cross-border ecommerce occurs anytime a merchant sells products to consumers located in a different country than where their business is based.
Emerging technologies and strategies are connecting products and consumers around the world. As a result, more and more brands are moving into untapped markets to grow their ecommerce revenue.
According to their guide to cross-border commerce, BigCommerce states that an increase in cross-border technologies is empowering brands to:
- Reach and study demographics in different countries
- Capitalize on the lower barrier-to-entry and decreased competition in smaller, developing markets
- Create divided go-to-market approaches within other countries
- Simply manage cross-border shipping and logistics
The cross-border ecommerce market
The cross-border ecommerce market is big business, and it’s on the rise. Its expected market value by 2026 is $2.2 billion. And the more comfortable consumers get with buying products from across borders, the more businesses stand to profit from catering to the preferences of international customers.
There’s a lot of room for growth via cross-border sales as long as brands figure out how to effectively reach customers in other countries and minimize common barriers such as language, currency, taxes, and shipping logistics.
The first step to global ecommerce success is ensuring the checkout process is convenient and intuitive for shoppers. And that includes making sure the mobile experience is good—regardless of where your customers are shopping. Global mobile commerce is expected to be worth $3.2 trillion in 2022 and grow beyond $5 trillion within five years. In addition, 43% of smartphone users turn to their phones when shopping.
Ensuring the checkout process is smooth across devices is making cross-border purchases a profitable reality.
The challenges of cross-border ecommerce
Cross-border selling is a very lucrative opportunity but is complicated if you’re not prepared. Brands have to overcome a few challenges to win customers from other markets successfully.
Language is one of the most important things to consider before selling to international markets. Did you know that 40% of online shoppers won’t buy from a website that’s not in their language? Localization provides global customers with a shopping experience feels familiar.
With all the work that goes into translating and localizing an ecommerce website for different markets, you don’t want to risk losing people at the last moment. Bolt localizes the checkout flow based on a visitor’s browser language and IP location. Customers see checkout information in their language, and shipping options, tax information, and currency amounts are localized to where they are.
On both sides of the ecommerce—consumer and merchant—money matters. Before purchasing a product, consumers want to know what it’ll cost them. If shoppers are visiting your website from another country and only see prices in foreign currency, they will bail.
Every ecommerce business knows how delicate the moment of decision is—70% of carts are abandoned every day. Investing in foreign exchange capabilities means you’re not making someone do extra work just to figure out how much your product costs.
All shoppers want to know when they can expect their package. It’s part of the thrill of online shopping. And nowadays, customers expect a seamless experience from the minute they get to your site to the package delivery.
Because international shipping often takes longer than domestic shipping, play it safe when promising a delivery date to account for unforeseen delays. Additionally, partner with a reliable logistics provider to make international shipping smoother.
When selling across borders, it’s essential to understand the foreign exchange taxes levied by the country where you’re selling products. Providing accurate information to your customers will positively impact your customer retention and brand loyalty.
Implementing a tax calculator into your checkout can benefit your business. A tool such as this provides clarity regarding taxes and fees.
Providing preferred payment methods
Payment habits around the world vary from country to country. As a result, the payment options that are considered standard domestically may not be the norm in international markets.
Forty-four percent of consumers say they choose ecommerce stores based on how accessible the checkout experience is, and 56% say they’ll only shop at stores that accept their preferred payment method.
That’s a lot of potential customers you’ll lose if you don’t provide a variety of payment options your international shoppers prefer. And for cross-border ecommerce, that means being willing to diversify into the payment methods most common in each of the countries you sell in.
While payment preferences differ worldwide, alternative payment methods (APMs) are gaining popularity globally. In 2020, 44.5% of ecommerce payments were made with digital wallets, making it the most popular global option—beating out credit cards at 22.8%.
Bolt makes it easy to accept the most popular APMs, including digital wallets like PayPal and Apple Pay, and buy now, pay later (BNPL) options like Afterpay. Bolt is continually adding support for top APMs—including extending coverage to local and regional payment methods in the near horizon.
The more payment methods you offer, the more consumer preferences you’ll cover, making it that much easier for shoppers to complete their purchases.
Meeting regulations and maintaining security
Every country has its laws and regulations, and businesses must ensure their ecommerce practices don’t poorly run. Thirty-four percent of consumers named security concerns as a barrier when considering a purchase from a foreign brand.
Security always has to be a top priority in ecommerce. If your checkout process doesn’t meet basic consumer expectations of safety and abide by local regulations in the markets you sell in, you’ll lose trust and risk legal consequences.
Bolt’s One-Click Checkout functionality is GDPR compliant and offers 3D secure authentication to ensure PSD2 compliance. As a result, ecommerce stores that choose Bolt can promise consumers a secure checkout process and top-level data privacy protections.
Is it time to go global?
Before venturing into the advantageous world of cross-border ecommerce, businesses should have a solid strategy and the right technology. But how do you know when it’s time to take your ecommerce business global? It might be time to consider expanding across borders when you:
- Can support alternative payment methods
- Have the bandwidth to expand
- Are on a scalable platform that can help an international market
- Have outgrown your domestic market
- There is a global market for your products
- You have mastered competitive pricing
Going global with Bolt
A seamless cross-border ecommerce strategy will widen your client base, boost sales, and increase your brand awareness on a global scale.
Now you can extend that benefit beyond your borders and earn the loyalty of consumers from other countries as well. Using Bolt to power your cross-border checkouts helps you expand your business reach so you can tap into all new markets. Earning new customers that keep coming back is the surest path to higher profits.
For a more in-depth look at cross-border ecommerce and the state-of-the-art features Bolt offers to help you optimize your international checkout experience, download the eBook, Going Global with Cross-Border Ecommerce.