Online Retail – Get Set for International Expansion

Sasha Hanau


The Outlook for Global Online Retail

UK Online retail is said to be on course to reach £77bn in 2012 (13% growth when compared with 2011’s figures) and the United Kingdom’s is second only to the USA in terms of the overall market value from ecommerce.

While the UK dominates online retail, it also accounts for 30% of all the cross border trade in Europe meaning that “British retailers export more than the rest of Europe’s e-retailers put together” (according to John Andrews, the MD of IMRG).

While most of the UK’s retailers are highly skilled in marketing and selling their products online, not all are currently embracing the opportunities that lie outside of the UK. So many huge opportunities exist in other markets that international trade has to be high on the agenda for those trading online – especially as the online scene is only set to get more crowded. The number of online businesses is rising approximately 30% year on year with around 230,000 online businesses operating in 2012. The IMRG predict that the number of businesses trading via the web will continue on to double in the coming 3 years, so if your business wants to secure its future – now is the time to be thinking about what markets will help make it more profitable into 2013 and beyond.

IMRG predicts that B2C ecommerce sales will exceed £1trillion by 2013 and currently the US, UK and Japan are the biggest ecommerce markets. As one might expect China is said to be growing so rapidly (130% in 2011) that it will not be long before it is by far the largest online retail market. In Europe; France, Italy, Spain, Russia, Turkey and Poland are tipped to be the fastest growing territories as are Brazil and Mexico in the USA. All of these markets present valuable trading opportunities for e-tailers that will help them expand and grow profit from their websites in the long term.

Aad Weening, the Head of International Retail at IMRG commented recently:

“The future of e-retail is global, and with the inevitable slowing of growth in several major markets in the likes of North America and Europe, it is important for businesses to understand where the future opportunities will be.”

The Marketers View on International Expansion

UK businesses are feeling the strain of the (what seems like) never ending financial doom and gloom at home so it’s no wonder everyone is thinking about international expansion.

The keenness for a business owner or CEO to expand into new overseas territories is critical but there are other departments that play a hugely important role in whether that plan ever gets out into action and how successful it is. Buy in from the marketers is of course of the utmost importance when entering a new market.

Last week Search Laboratory attended the Future of Digital Marketing conference hosted by Econsultancy in London. The day opened up some interesting debate about the future of the digital marketing industry and in particular it addressed what it found to be the top 20 major issues that marketers are concerned about, unsurprisingly, expanding into new territories and multilingual search marketing, these were in the top three things that concern marketers.

Overcoming the Fear

Marketers are wary of how they can limit the risk involved in entering new markets and are cautious as to how they can manage campaigns in multiple languages which they do not understand. Inevitably there is likely to be a feeling that they could have less control over campaigns which they linguistically cannot understand.

Despite them knowing that establishing visibility in international markets is critical to their long term success, the idea of actually beginning the process is really daunting. No one likes unfamiliarity and while markets like China have never been as accessible as they are today, the lack of knowledge of trading in those markets is enough to severely stunt the businesses international growth.

There are numerous ways to enter new markets, you can open a branch in-country or use an overseas agent but the easiest and least risky way is use search engine marketing.

Search marketing can help you overcome the biggest challenges – for example gaining insight into new markets and knowing which countries to start with!

Finding out which countries you think will be most receptive to your product or service and that hold the most potential, is something to be carefully considered. You can commission a market research agency or a specialist agency like ourselves to do an in-country market report for you – this will look at your business, the demand for its services in that country and the current competition you are likely to face. Whichever route you take it is important that someone native to that country is employed by the company. You can undertake market research in-house but realistically only someone native to the target country can access the information that will really help you make sensible decisions about that country as a prospective new market for your product or service.

If you are in doubt of your likely success in a new market it’s best to first test it out with a localised PPC campaign. This will give you valuable insight into the demand in-country as well as helping to inform your future keyword strategy for both full scale PPC campaigns and even potentially your SEO strategy in the long term. Full site localisation is both costly and time consuming so we would always suggest trying out PPC first before launching a full site localisation and country specific SEO campaign.

Know Your Market

Marketers are increasingly aware of the need to understand the regional and cultural differences between markets. This is more complex than simply adapting the language you communicate in. Every element of your marketing and search campaigns (including your landing pages / website) need to be targeted to the territory and the way customers in that country like to be informed. Only a native from that country is qualified to advise you on this. Don’t think that translation of keywords, your site and adverts alone will suffice – it will lead to wasted budget and wasted opportunity.

Forrester Research predicts that the global online population will reach 2.32 billion by 2014 and frankly the possibilities for global e-retailers are endless.

If you found this article interesting or your business is considering expanding abroad, watch this space as we will be publishing a research led whitepaper on multilingual internet marketing and how to attract global trade online in early July 2012. Please contact us if you would like to be one of the first to receive a complimentary copy.


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