Internationalization always sounds exciting: opportunities, growth, revenue…and of course, what nobody likes to talk about, those inevitable mistakes. Just do it, right? But what if the most commonly made mistakes could be easily avoided? At Salesupply, we have helped a wide range of highly diverse businesses to internationalize their online stores. But taking the first steps across borders is only a small part of e-commerce internationalization — the real challenge is in making money. How can you become profitable? What investments could be crucial to making things really work? Here are 7 mistakes we think you can easily avoid on your way to success.
1. Nobody feels responsible
A new market demands a lot of attention and time investment. But not everybody in the organization may share the same level of enthusiasm about overseas expansion as the CEO. Often people are simply too busy doing what they were doing before the new market entry. But if nobody sees the international expansion as his or her project, it is hard to get the attention and dedication of co-workers when something needs to happen. That’s why having a country manager is a real asset. You can choose to assign this task to someone internally or hire a new employee, alternatively you could consider outsourcing the management of your foreign shop. The country manager becomes the project owner, able to identify needs and problems, communicate across organizational levels and request and organize resources needed to cater to the new market.
2. Nobody possesses local insider knowledge
Of course, managing a new market from your headquarters may be cheaper and easier to fit in your strategic roadmap. However, a lack of local expertise can hamper your success on many levels. Do you possess enough knowledge of the market, the population, culture and other specific market dynamics? Is language a barrier when trying to arrange things? The only way to gain the trust of the new client pool, is by addressing them appropriately in their own language and ways. Local expertise also comes in handy when designing materials such as holiday related promotions, marketing campaigns and the layout of your user interfaces. And last but not least, your native speaking local team will have no problem dealing with legal and financial issues, that you may need to handle in your new market. Hiring a local team however, implies a considerable number of investments and long-term obligations. You might consider working with a partner instead, to take care of your local operations.
3. The product offer is not adapted
Does it makes sense to launch all of your products at once in the new market? Have you analyzed what people buy? Investing in localizing the products on offer which would not have a high profit margin, might not be a smart strategy. Carefully analyze demand and competition in the new market. In addition, take a careful look at marketing costs (cost per click and cost per order) and sales prices. What margins can you achieve with which products? Can you make (more) money in this market (than at home)?
4. A lack of development resources.
Adding new target markets means increasing the workload for your development team. And even if the new markets might start off as less profitable and thus appear less relevant, they deserve the same dedication as your home market. If you don’t free up the necessary development capacities, chances are your new markets won’t grow, or at least not as fast. Ramping up your development capacities is a key factor in creating scalability and accommodating growth in a new market.
5. There is not enough manpower at customer service
If all goes well, selling in a new market means an increase of customer touchpoints. Consumers will reach out and expect you to help them. Your existing team might be too small or not comprise adequate skills to fulfill this task. Needless to say, in e-commerce, helping customers in their native language is virtually a must. A dedicated team to handle local customers will increase customer satisfaction and reduce the strain on your existing service team. Outsourcing customer service in your new target market can be a solution to starting off at relatively low cost and, without having to build up an actual physical presence in the target country.
6. Profits and losses are not splitted per country
Reporting is important, especially when times get a little rough. When a retailer is struggling, they often exit the newer smaller markets, or resources dedicated to them are cut. Measuring profits and losses for each local market individually provides a realistic picture of which markets are growing, and which are struggling. This allows an evaluation of which resources are worth keeping in place and which investments should be cut down.
All of the people involved in above-mentioned points will be able to deliver valuable information and data on your company’s performance in your new target market. The country manager plays an important role in gathering and channeling this data. Listen to him! Whether it’s customer interaction, development requirements, losses, profits or specific KPIs, analyzing this data will help you to improve your operation and ultimately increase sales. Nothing happens overnight. A new market means carefully evaluating the progress so far and implementing the attainments in the future strategy.
Get in touch!
Are you interested in exploring your cross-border opportunities? Salesupply offers a full range of modular solutions, to help you explore and enter new markets. We are a global e-business services company, that enables online retailers to achieve profitable international growth faster, more efficiently and at relatively low costs. Salesupply provides solutions ranging from research and strategy, to effective localization of web shops, followed by complete operational support, traffic generation and brand management. Through our advanced systems, our flexible operational structure and our international office network we are able to ‚embed‘ these services seamlessly in our customers’ business model. Today we are helping over 200 satisfied webshops with their international e-commerce, including Marks and Spencer, G-Star, O'moda.eu, EKOSPORT and many more. The Salesupply network includes subsidiaries in the Netherlands, the US, Spain, France, Denmark, the UK, Italy, Brazil, Russia, Poland, China and the US. Contact us at email@example.com!