DHL: Seizing the ecommerce opportunity Abigail Brodie Director of Ecommerce
WHAT DOES YOUR COMPANY DO?
At DHL Express we specialise in time and day critical shipping to all corners of the world. Our network spans more than 220 countries and territories and we work with businesses of all types and sizes to help get their goods to where they need to be, quickly and securely.
At DHL we do more than move parcels from A to B; we work collaboratively with businesses at every stage of their export journey – providing expert advice and guidance on taking their products and services to new markets.
HOW IS DHL RISING TO THE ECOMMERCE OPPORTUNITY?
The evolution of the ecommerce market is having a big impact on our business. With the internet now so widely accessible, and people taking to devices such as smartphones and tablets to shop online, businesses are rapidly responding to this growing online demand. SMEs are seizing the opportunity that selling online presents – making it easier than ever to take their products to new, international markets. At DHL we’re busier than ever supporting them with this.
"An express delivery option can increase basket values, by as much as 71% as well as growing Lifetime Customer Value. Our customers see a 20% increase in repeat custom as a result of having an express shipping option."
At DHL Express UK, the number of shipments that we handled for UK-based online retailers last year grew by 30% – higher growth than any other area of our business. And we don’t expect this demand to slow anytime soon. Research by IMRG and Capgemini shows that £133bn was spent with online UK retailers last year, up 16%, and it predicts further double digit growth this year.
HOW BIG IS THE CROSS-BORDER ECOMMERCE OPPORTUNITY?
This change in shopping habits presents huge opportunities for online retailers, particularly those in the UK. British products have long been recognised around the world as a hallmark of quality and they still are. Together the UK, the US and China account for 60% of all cross-border ecommerce supply, but only around 30% of demand – that’s great news for British retailers.
A recent DHL Express report, ‘The 21st Century Spice Trade: A Guide to the Cross Border E-commerce Opportunity’, found that 71% of online retailers expect their cross-border sales share to increase even further. At DHL Express we’re working hard to help as many businesses as possible recognise this opportunity.
One business that we’ve helped to recognise their international export potential is Leicester City FC. Following their 2015/2016 Premier League win we’ve worked with the club to export their merchandise to 66 countries – more than double the number of destinations they exported to at the start of the season, and reaching previously untapped markets such as Greenland, Kuwait and Mexico.
WHAT ADVICE WOULD YOU GIVE TO ONLINE RETAILERS CONSIDERING EXPORTING?
Whether it’s a start-up with global ambitions, or a well-established successful UK business, we work closely with companies of all sizes to help them take their products overseas and consider new export destinations. We have some simple and easy to implement tips that we’d encourage any business with ambitions beyond the borders of the UK, to consider.
Firstly, if you already ship internationally, be really clear about it on your homepage. People want to know right away that your goods are accessible to them. You should also consider offering an express shipping service, giving customers the opportunity to choose between an express or standard service. The 21st Century Spice Trade report found that businesses offering a premium express service grow 1.6 times faster than those that don’t. An express shipping option also helps increase sales; our customers found that when consumers choose an express option basket values increase by as much as 71%. An express option also drives repeat custom. Our customers see a 20% increase in repeat custom as a result of having an express shipping option, increasing the Lifetime Customer Value.
Coupled with express shipping, it’s important that you consider your returns policy. Customers value the ability to return unwanted goods, and a quick and easy returns policy increases trust and encourages customers to buy more. Some 72% of customers said they were either “likely” or “somewhat likely” to shop more with a retailer that made the returns process easier according to the ‘MetaPack 2016 State of Ecommerce Delivery Report’. The reality is that customers will buy more, but still return only a fraction of what they purchase.
Language options on your website are important too. You’ve succeeded in getting someone to your site and now you want to keep them there by ensuring it’s as accessible as possible. Payment options are also a key consideration; find out what the popular payment platforms are in your target markets. For example, in China the instant messaging app WeChat has a mobile payment service that has more than 300m customer bank cards registered.
We hear regularly from businesses new to exporting that they find the prospect of navigating customs and taxes daunting, but it doesn’t need to be. Export experts, such as DHL Express, can offer guidance when it comes to these challenges and there is a wealth of information and resource available to support you. Exporters can also take advantage of additional services such as Delivery Duties Paid. Shoppers like to be clear about costs and our customers see uplift in sales when they make it clear on their website that local duties or sales taxes are included in the price quoted, as it eliminates any sense of uncertainty.
We work with all kinds of online retailers and, with our global footprint, have a unique insight into the different markets and how to trade with them. Whatever challenges you face in your export journey, DHL is always on hand to offer advice. If you have any questions about exporting, or are wondering where next to take your business, get in touch.
Case Study: Gymshark
Gymshark is a fitness apparel and accessories brand founded in 2012. Over the past five years, the company has grown from being a screen printing operation based out of a garage, to one of the fastest growing and most recognisable brands in the fitness industry.
When the business started out, its focus was on creating products for as little cost as possible. However, that vision has changed and now its key drivers are offering a world class customer promise and immersing itself in the target customer. Gymshark has a customer demographic of 60% male and 40% female, aged 16-28, and very socially savvy. Its customers are impatient and intolerant of broken promises and, for that reason, perfecting the delivery experience has been a vital consideration for the brand.
Up until January 2015, Gymshark only offered a standard delivery service, shipping around 17,000 orders that month. In July 2015, the brand partnered with DHL to offer an express delivery option for the very first time. In June 2016, after joining forces with DHL to reach new markets with a premium delivery option, Gymshark’s orders were up to 30,000 – taking more orders that month than it did on Black Friday in 2015. By October 2016, a massive 50% of Gymshark’s customers were opting for the express delivery service when checking out. And the impact of adding an express shipping option hasn’t stopped there; Gymshark has seen average basket values rise from £41 when selecting the standard shipping option, to £70 when selecting the express option. Some 47% of its customers who select the express option return and shop again, compared to just 27% of those who select standard shipping.
Since 2014, Gymshark’s revenue has grown by a massive 210%, and it’s still rising. Today, making use of DHL’s global network, Gymshark sells products to customers in 150 countries – and anticipates that 40% of total revenue in 2017 will come from customers in the USA. Deservedly, Gymshark took the top spot in The Sunday Times Virgin Fast Track 100 league table 2016 – which ranks Britain’s 100 private companies with the fastest-growing sales over their latest three years. And the business has high hopes for 2017, too.
“As a young, online business which experienced global growth very quickly, delivery and customer service could have proved difficult for us. Fortunately, this hasn’t been the case. The relationship we have with DHL has enabled us to offer our customers a stellar worldwide delivery service which has been crucial in building customer relationships and aiding our worldwide expansion,” says Steph Green, Trading Director, Gymshark.
“DHL has helped us to offer amazing delivery times to impossible regions; improved efficiency in our operations and dispatch process and helped us to serve our US customers as if we had a US base ourselves. We are looking forward to working on more exciting projects in the near future, all aimed at improving service and enhancing customer experience for Gymshark fans around the world.”
How do I find out more?
Get involved in our 'GoGlobal’ competition
Abigail talks about businesses “recognising their international export potential”. To support internet retailers in this goal, DHL is offering one UK SME the opportunity to reach the Premier League’s global audience. To get involved you can find out more info here: http://dhlbusinesslive.co.uk/goglobal/