It wasn’t all that long ago that making the rare online sale from an international shopper was largely a manual process held together by a PayPal transaction. Shoppers excited to get their favorite items from abroad were happy to complete the purchase with no real expectations for service or individualized experiences.
Largely due to evolving consumer demands, retailers and brands ramped up their online efforts last year in response to consumer pressure to localize their global e-commerce sites. This further cemented consumer expectations for more tailored experiences regardless of location. Asos, Nike, Victoria’s Secret and Calvin Klein are great examples of innovators that continue to raise the bar in cross-border commerce through exceptional service and localized experiences online.
A recent Forrester report predicts the global online fashion market will reach $765 billion dollars by 2022, equating to 36 percent of total fashion sales. Compare that to $253 billion and 14 percent of sales in 2014, and you see a sales trajectory with significant opportunities for global e-commerce retailers who do it right.
Here are a few trends that will shape global e-commerce this year, pointing the way for retailers wanting in:
Sell Global, Feel Local
To win in local markets, retailers must extend a well-known global brand comfortably into those customers’ homes. This requires a deep understanding of each respective market, from shopper preferences to marketing strategies. In 2019, we will see retailers take localization a step further by removing the friction from the shopper’s journey.
Think local payment preferences, consistent local pricing, best local delivery solutions and in-country return options. This year we will see an extension of the debate of global site versus a “microsite,” and whether delivering a global experience to all shoppers trumps hyperlocalized, but less consistent experiences — or a combination of both.
Returns, Bulk Shopping and Shipping, Oh My
When it comes to returns, cross-border sellers have also enjoyed a much lower return rate when compared to the 30 percent-plus return rate of U.S. e-commerce sellers. But this could change, particularly as shoppers become less cautious and expectations for the ability to buy their favorite brand across borders solidify.
In 2019, global sellers will start to view returns as part of their overhead and invest in them accordingly. Decisions on regional inventory banks, how local stores and partners collaborate to target local shoppers, regional inspection and reselling hubs for the fulfillment of local orders and sustainability will all be on the table for discussion. This may just reinvent what is possible through returns for the entire retail industry.
Smart Stores, Smarter Sellers
Global e-commerce has fallen behind most localized brand experiences and service innovations. International shopper registration is too often passed over the “great technology wall” where customer loyalty programs, and even customer recognition, are funneled to another server and another solution.
In 2019, retailers will bring smart technology tools and big data to cross-border commerce to better recognize shoppers and intuit a shopper’s needs, whether it’s same-day hotel delivery, local returns, incentives or more. A customer brand experience is important for all customers, regardless of where they are sitting. Knowing what and how to sell to a shopper in Mexico versus a shopper in South Korea will evolve into knowing what to sell to this shopper in Mexico and that shopper in South Korea.
Finally, what powers the greatest success is having the right product in the right place. In 2019, global retailers and brands will extend omnichannel e-commerce solutions backward into the supply chain to allow in-store pick-ups with matching in-store pricing for shoppers near a store, and regional warehouses to source fast shipments and enable even faster returns. With tariffs and trade regulations in flux and customer demand evolving, fluid inventory staging and fulfillment might be the most important trend to win.
While not every top brand is available in every top global market just yet, in 2018 it was clear that the industry reached enough critical mass to affect consumer expectations about local availability and service excellence. It is no longer a delightful surprise for a consumer to be able to buy in one country from a seller in another. They expect it, along with the experience of ease, clarity and speed. Each of the aforementioned trends necessitates a global e-commerce solution that can source items to a shopper and ensure the overall purchase profitably, fast and easy.
As we head into 2019, global retail brands must be prepared to deliver on consumer expectations, or face falling behind.
Cynthia Hollen is president of eShopWorld U.S. and a global e-commerce strategy adviser.