OFX’s Hamish Muress offers top tips to help fuel your international sales and bring more of your cash home
This post is by Hamish Muress, Senior Business Development Manager at OFX, a global payments company that offers specialized support and service for online sellers.
Cross-border ecommerce has been building momentum for several years now and shows no signs of slowing down. Without the traditional bricks-and-mortar hurdles of going global, more countries than ever are leveraging the ecommerce trend, while consumer trust in buying international goods strengthens.
Estimates by BI Intelligence state that global cross-border ecommerce will generate in excess of $1 trillion in sales for retailers by 2021. Ecommerce businesses, particularly marketplace sellers, are increasingly offering their products globally.
Cross-border trade comes with its own challenges though, from understanding overseas markets to currency conversion. These expert tips should help you overcome barriers and give a solid foundation for cracking overseas markets as an online seller.
Know your market
Before selling overseas, it is essential to research the markets where your target customers are underserved, and where there could be a gap for your product to fill. Be sure to research competitors and identify the places where you may face pressure from local rivals.
Should you have the necessary resources, traveling overseas can be a great way to familiarize yourself with each market, tap into local know-how and immerse yourself in the unique conditions you’ll face. Of course, this first-hand experience will also help you when marketing to overseas buyers – a little effort and knowledge can go a long way.
However, if international travel isn’t possible, there are plenty of other ways to educate yourself about new markets. Excellent country guides are available from Export.gov for sellers in the USA and the DIT for sellers in the UK, giving a clear overview of the markets that could work for you and your product. You could also consider running a low-cost survey on social media, to get feedback on your product directly from target overseas customers.
To go global, get local
Each country will have its own regulations, so doing your research up front will mean the selling process is much easier down the line. Consider everything from customs restrictions (you’d be surprised by what you simply can’t ship to some countries) and taxes, to simple things like payment methods and local holidays. In China, for example, November 11th is “Singles Day” – the single biggest online shopping day of the year. Taking advantage of this could give your sales a huge boost.
Consider translating your website, so you’re better able to communicate with customers in your target market. Choose an expert translator, or simply use a plugin that can automatically convert your website to the local language.
Finally, remember to research the differences in local sales platforms, as they may differ from the UK. For instance, Australia doesn’t yet have Amazon (although it will soon), so you’ll need to look at a local alternative if that’s your marketplace of choice.
Build strong SEO, and consider paid campaigns
Strong SEO can play a huge part in reaching new international customers, so don’t forget to build it into your plan.
It’s best to start with some research into local keywords and competitors. Which keywords are your competitors targeting in this market, and where are they getting their links? Don’t just assume that you can use the same keywords that you do back home, as these can vary even in English-speaking countries. Targeting the wrong keywords can generate poor quality traffic and fewer conversions, so it pays to be thorough up front.
If you want to go even further, it’s worth setting budget aside for Pay-Per-Click (PPC) adverts. These help to bring quality traffic to your site through the use of targeted keywords, and can form part of a well-rounded inbound marketing campaign.
Partner up for smooth logistics
Now it’s time for international shipping – and you certainly shouldn’t underestimate its importance. In fact, 90% of online shoppers have abandoned orders because of shipping costs, while poor delivery can seriously undermine customer satisfaction.
Sourcing local logistics providers can be costly and inconsistent, so opt for a global delivery company like UPS, which can give you expert support that’s both cost-effective and easy to manage across multiple markets. It’s important that customers have control and visibility over their shipments, so be sure your provider offers a quality service that won’t let you down at the final hurdle.
Bringing your money back home
You’ve done your research, listed your items, and the international orders start to roll in. The next part is getting your overseas sales proceeds back into your home currency. This is where an OFX receiving account can help.
A receiving account is used to collect your funds from overseas marketplaces. You start by inputting the account details, provided by OFX, into your marketplace settings. Your sales proceeds will be paid into your receiving account within one to two business days. You can then choose what to do with your funds.
You may choose to auto-convert, so as soon as funds arrive in your account they are automatically exchanged into your home currency. Alternatively, you can leave the funds and wait for a better exchange rate, or use them to pay suppliers. You can make supplier payments directly from your receiving account, without having to convert funds, although there is a small margin fee.
So why use an OFX receiving account? OFX offers a preferential exchange rate compared to converting your sales proceeds through Amazon or PayPal, who add 2-3% on top of the current exchange rate.
As an example, let’s take a seller based in the UK selling to Amazon.de. If he sells €10,000 a month, Amazon would (at the time of writing) provide an exchange rate of around €1.15 to the pound, so the seller gets approximately £8,700 back.
The OFX rate would be closer to €1.13 to the pound, so the seller would get back around £150 extra. Simply put, the seller keeps more of their sales and profit. Of course exchange rates are constantly changing, that’s why flexibility, choice and access to your money is so important.
Best of all, there are no monthly account fees or setup costs with an OFX receiving account. We take a small margin, agreed upfront, when sellers convert funds or make same-currency transfers. Opening an account with OFX is easy, the process is quick and can be done in less than a day.
This post was sponsored by OFX.