With the widespread availability of digital devices and the expansion of logistics capabilities, consumers who shop online can have access to a wider range of products, brands and cheaper prices when they shop outside of their own country. This trend of shopping abroad is known as cross-border commerce.
Cross-border sales have grown exponentially in the past few years, with 35% of consumers worldwide currently shopping on sites based outside of their home country. This trend shows no signs of slowing down, with the total global revenue for cross-border expected to double by 2018. In order to capitalise on this growing trend, it will likely be important for retailers to understand the growth of cross-border commerce. This includes knowing why shoppers increasingly turn to cross-border commerce, which countries are emerging as the top markets for cross-border transactions, and recognising what shoppers are buying.
Globally, 67% of consumers who shop abroad are buying because prices are lower outside of their own country. These prices are usually low enough to make up for additional fees or taxes associated with cross-border commerce. Other reasons include the accessibility of brands that aren’t available in their own country, a wider range of products, and better customer service.
As the global cross-border market has emerged, three big players have continued to obtain the most revenue with buyers from around the world congregating on their sites: the US, China and the UK. Approximately 67% of UK retailers offered worldwide delivery last year and 65% of their online sales revenue came from international orders.
Cross-border commerce enables digital customers to shop for virtually anything they want, from practically any digital store they want, at any time. But what exactly are shoppers buying? UK and German consumers buy clothing via cross-border commerce more than any other nations in Europe. For nearly every other country, home electronics is the second most popular product category in the European market and books comes in third place. Notably, a category with huge potential for cross-border growth is preserved food and groceries, especially in the UK; nearly one in three online shoppers in the country buy food online, making it a unique and expanding market.
As shoppers look for deals and unique items worldwide, they are concerned about numerous factors, including poor shopping experiences, complicated or fraudulent transactions, seller reputations, the authenticity of goods and slow shipping times. In response, many smaller or speciality shops worldwide have been embracing large online marketplaces to create cross-border opportunities as they have broader and more trusted online presences, a proficiency in logistical efficiencies, and reliable service due to their maturity within the cross-border market. These are all factors that ultimately make the cross-border experience and products more attractive.
In conclusion, global retail statistics continue to display the recent and ongoing growth of the online retail cross-border phenomenon. As businesses, technologies and economies become more globalised, online shopping continues to spread far and wide, surpassing once present boundaries and increasing product availability to more areas than ever before.
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A leading global commerce service provider, PFS enables brands and speciality retailers to achieve their commerce goals. As an ecommerce solutions provider, we combine consulting, agency, technology and operations to deliver unique and branded customer experiences, creating commerce without compromise.
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