eCommerce has opened the doors to sell products and services nationally and internationally. The merchants can reach all over the world with their online shop. However, international selling needs to be studied in depth to pursue it further. Let us discuss the meaning, importance, trends, tips, statistics of cross-border eCommerce to help you explore national and international commerce.
What is Cross-Border eCommerce?
As the term suggests, Cross-Border eCommerce is the online sale across borders in countries abroad. It is the process to make a reach in the international markets with your online platform.
Thus, it is called Cross-Border eCommerce when the selling of products or services is done across the borders by the businesses or wholesalers to retailers or customers.
The value of the eCommerce market in 2019 was US$ 578.57 Billion and by 2026 it is forecasted to reach US$ 2,248.57 Billion (CAGR 17.4%).
The growth in Cross border eCommerce and the demand for such products is due to various reasons such as affordability, the higher quality of the products, the products not available domestically, etc.
The benefits of such cross-border products to the businesses are that it can expand the business globally and increase the worldwide selling; to the manufacturers.
Having their own eCommerce business can remove the expensive mediators and enable direct selling for the manufacturers.
The payments in Cross-border e-commerce include various payment methods such as debit cards, credit cards, UPI, mobile wallets, net banking, QR codes, etc. Thus, the payments in such a sale can be done within seconds and the order can be placed immediately.
The paperwork can also be completed in no time due to the whole online process. It reduces the cost of physical marketing such as pamphlets and printing.
What are the driving forces for the growth of Cross-Border eCommerce?
The market drivers for the rise on the cross border eCommerce are as follows:
eCommerce businesses could reach all over the world due to the prevalence of digital adoption and the drastic spread of the use of smartphones. These two factors have helped to connect the whole world and have enabled technology-savvy segments in society. The sellers are making the variety of products available online and the customers explore and shop internationally availing the underlying benefits.
Various strategies have been useful in driving cross-border selling, one of them is to offer the products and services in the home currency and language. This would help the customers relate, compare and decide. They would be able to trust and depend when buying from you. The payment options and the currency support play a huge role in this. There are various platforms available that provide these and also help with the fast money acceptance services.
PayStudio supports multiple currencies and all major countries with its international card acceptance.
Points to remember
The eCommerce market drivers are mostly based on the technology, there are certain points to remember based on the strategies to build a successful Cross border eCommerce:
It is important that you decide the eCommerce niche to target the customers and the market. This will help you decide the country in focus. Also, this will need research and study of the demand of the types of products or services that the targeted customer base of the particular country or market. In this, the study of the customs, culture, and traditions of such a customer base plays a huge role.
The study of the targeted markets and the countries is going to be a continuous effort. The prices and trends of such countries and the simultaneous changes in your selling are a must. Not only these, but the major aspect to keep into consideration is the study of law, regulations, and restrictions in the targeted foreign markets.
FIRC comes under the regulation for the payments, it helps to claim the GST exemptions in the international payments. FIRC is an invoice remittance certificate for each international transaction and it is available offline for the purpose. Whereas, there is Import Export Certificate (IEC) that helps with hassle-free cross-border selling.
The booming cross-border eCommerce market
Before the global pandemic, cross-border eCommerce had quite an upward trend due to the prevalent market drivers. The restrictions in the international movement during the lockdown had affected cross-border selling.
Travel, clothing, and various other non-essential products are in the process of recovery. On the other side, other industries such as Healthcare, Edutech, mental health, work-from-home products, Entertainment and OTT, etc are booming across the world.
Here are some of the important cross-border eCommerce trends:
- Cross border buying is done by 67% of the total customers
- It is prevalent in common among the customers of age 18-54
- The house with children tend to shop cross border more than the one with no children
- The popularity of the products are shoes, fashion, electronics, personal and beauty care, jewelry, games and music, sports, books, etc.
- The obstacles in Cross border eCommerce include high shipping cost, slow delivery of products, high and unclear tax and duties, trust issues on the platforms, non-availability of preferred payment mode, no customer services, language issues, etc.
The key takeaways from this article relate to the ongoing trends, booming industries, and the drawbacks in cross-border eCommerce. The mentioned benefits, market drivers, points to remember and the given statistics deliver an overall guide on the trends and tips to cross border eCommerce.