Expanding internationally via marketplaces: a guide for Australian retailers
By Mark Gray, managing director, APAC, ChannelAdvisor.
Online shopping across the globe is increasing by the day, with an estimated 40.4% of the worldwide internet population making at least one purchase through a digital channel last year (note 1). Cross-border trade (CBT) is playing an increasingly significant part in this growth.
CBT can provide many opportunities for a prepared retailer. These include:
- A vast number of new customers,
- the chance to overcome seasonality (it’s summer somewhere, after all), and
- a potential niche in an underserved market.
Unfortunately, to the average online retailer, CBT can be an unwieldy beast lurking in the corner — you need to tame it, but it seems frighteningly difficult. We frequently recommend that retailers jump-start their global reach by selling on marketplaces. Marketplaces such as Ebay, Amazon and Trade Me are a good starting point. They already have an established audience of millions, as well as a recognised process and low barriers to entry. Testing your products on these sites will be a good indicator of how your products will perform in that market, while establishing an international customer base.
Here are my top tips for international expansion via online marketplaces.
With 237 million active global customer accounts (note 2), Amazon is one of the fastest growing channels for online retail. If you’re not selling on Amazon today, you’re leaving money on the table. Amazon differentiates itself from many other marketplaces with its laser focus on a positive buying experience. As part of that focus, Amazon has made great efforts to simplify how buyers locate and purchase products. If you want to trial your expansion to new regions using Amazon, you could consider using the Fulfilment by Amazon (FBA) program for some or all of your products. FBA is a service that enables merchants to store inventory and fulfil orders from an Amazon fulfilment centre. When customers place orders for your products, Amazon takes care of packing and shipping the products to your buyers.
With Amazon’s Expand Offers Internationally tool in Seller Central, you can identify which products in your inventory are already in the Amazon catalogue for another targeted country. To list these products, you only need to provide the local price and quantity. This will help you expand quicker and with reduced translation costs.
With more than five million (note 3) Australian customers and 7.3 million (note 4) visitors per month, Ebay.com.au is easily Australia’s most popular marketplace. Similarly to Amazon, Ebay allows you to test the waters of international expansion by displaying your products to buyers in different regions. When listing your products on Ebay.com.au, specify that you’re willing to fulfil items internationally and indicate the postage cost. By doing this, your items will sometimes be shown to international buyers, and you can begin to judge the appetite for your product range in new markets.
To take your cross-border operations a step further, you should complement your existing Ebay Australia account by listing directly on international eBay sites. Don’t forget to consider language when creating your listings, and remember that eBay listing requirements might vary from country to country – so optimise your data to ensure the best results.
While Ebay and Amazon are the leading marketplaces in much of the world, both are dwarfed in New Zealand by Trade Me. In a country of 4.5 million people, there are 3.4 million member accounts and more than one million members bought or sold an item on Trade Me in the past year (note 5).
Trade Me is a multi-category marketplace that began as a platform for second-hand goods sold in auction format. Trade Me is now ramping up its status as a new goods, fixed-price, B2C marketplace. Australian retailers should use this opportunity to get their merchandise in front of the more than 700,000 Kiwis who visit Trade Me each day (note 6).
Many of these marketplaces have paved the way to international expansion for retailers, handling the details, sometimes even down to fulfilment, so you can test a new market with minimal investment.
- Trade Me Monthly stats