Amazon and eBay Enterprise this week both put the focus firmly on the power of marketplaces to enable export.
While Amazon and the UK government announced a new partnership that will encourage small and medium-sized businesses to export through Amazon’s marketplace, eBay Enterprise released a Buying Across Borders study that suggests the easiest way to boost cross-border sales is to offer affordable delivery. Both reflect the growing power of marketplaces in today’s digital economy. Amazon says the number of UK businesses that sell through its marketplace has grown by 90% over the last year.
The partnership between Amazon and UK Trade & Investment (UKTI) takes the form of a Memorandum of Understanding to work together to help small and medium-sized businesses to increase their ecommerce export sales by developing programmes and resources that will make it easier for British companies to sell overseas through the Amazon site.
“The digital economy is expanding rapidly around the world and is creating exciting opportunities for British companies to grow by increasing their exports,” said Doug Gurr, VP, China country manager at Amazon. “At Amazon we have worked hard to build systems to make it as easy for companies to sell abroad as it is for them to sell in their home market, and this new partnership with UK Trade & Investment will help UK businesses to expand their international sales and drive cross-border trade.”
The new MoU is signed a year after the coalition Government launched an e-Exporting Programme supported by Amazon alongside marketplaces such as Rakuten and Tmall.
Catherine Raines, chief executive of UKTI, said: “The global ecommerce market grew by more than 20 percent last year, underscoring the huge opportunity for businesses of all sizes to grow their businesses by increasing their sales online and expanding to new markets. By working with industry partners such as Amazon, UKTI is helping to make sure British businesses set the pace both in terms of ecommerce and exports.”
UKTI figures show that of 5m companies in the UK, only one in five currently export, compared with one in four in France and one in three in Germany. One in five UK SMEs sell through digital channels, according to the Lloyds Bank UK Business Digital Index 2015. In the last 12 months, UK businesses exported products worth more than £1bn through Amazon Marketplace, while the the number of UK businesses using the platform grew by more than 90%.
The eBay Enterprise Buying Across Borders report questioned 227 online shoppers from the UK, Southern Europe and Western Europe in a study carried out by Imperial College London in July.
Asked to rank the biggest barriers to buying from international sellers, 80% cited high delivery costs, 75% cited the unavailability of their preferred payment method, 68% poor product information, including images, text and video, 64% long delivery times, and 57% the price difference resulting from the exchange rate.
Enda Breslin, European head of business development at eBay Enterprise said: “European consumers are increasingly considering overseas retailers as part of their online shopping mix, and it’s expected that EU cross-border shopping will tip £28.5bn by 2018*, but lack of delivery and payment options, as well as poor product information, could be harming some UK retailer’s sales prospects in the region.”
The report found that shoppers buying higher-value, luxury items from foreign retailers were prepared to pay more for delivery and wait longer than shoppers buying cheaper goods.
“Just like domestic consumers, cross-border shoppers also want different services, delivery speeds and price points depending on what they are buying,” said Breslin. “It comes down to choice; retailers that invest in providing a range of delivery options, payment methods and detailed product information will be able to up-sell premium services to those prepared to pay for it, without turning off those shoppers happy to compromise on service for a lower price.”
* Forrester’s Western European Online Cross-Border Retail Sales Forecast, 2013-2018
