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The State of X-Border Online Holiday Shopping

December 22, 2016

ecommerce-holiday-shoppingOnline holiday shopping in the US: double-digit YoY growth

Holiday season online retail sales in the US keep growing dramatically from year to year. Cyber Monday online shopping this year hit $3.45 billion, up 12% from last year. And the Cyber Five shopping days (Thanksgiving Day, Black Friday, Cyber Weekend and Cyber Monday) brought in $12.8 billion in online consumer sales.

All in all, holiday season online sales are forecast to exceed $90 billion in the US alone. [1]

Cross-border e-commerce holiday shopping is also growing

Cross-border e-commerce is expected to grow to a staggering $1 trillion by 2020, with an average 26% YoY growth during the 2015-2020 period. [2]

Two-thirds of consumers from more than a dozen countries who participated in a recent Pitney Bowes survey stated that they shop cross-border, with close to 60% of those saying that they do so on a monthly basis. Some markets where cross-border shopping has become a part of daily life are China, Australia, Singapore and Canada. [3]

When it comes to the holiday season, even cross-border consumers who do not celebrate Christmas are active on US online shopping sites. In 2015, for example, Chinese consumers spent approx. $55 million on US e-commerce sites and that number is predicted to double in 2016. [1]

There are, however, some clear obstacles to frictionless cross-border holiday shopping that need to be overcome in order to realize its full potential. In the Pitney Bowes survey mentioned above, 42% of cross-border consumers stated that they experienced holiday shopping challenges such as tracking inaccuracies, unclear return policies, final-price (including duty and tax) miscalculations, and shipping errors.

Who are the cross-border merchandising winners?

The US consistently scores #1 in terms of cross-border e-commerce “friendliness”, with China, the UK, Canada and Spain not too far behind. Some of the key characteristics of winning cross-border e-commerce sites [4]:

  • 80% of the top 10 cross-border merchants accept 6 or more currencies (vs. the average of only 23% across all merchants).
  • Only 30% of the top 10 merchants require customers to sign up for an account to make a purchase (vs. 90% among the bottom 10 merchants).
  • Free shipping is the largest differentiator between the best and the worst sites.

 

Cross-border communications: a key success factor

In addition to solid payment and logistics infrastructures, online e-commerce sites that want to capture the hearts and wallets of holiday season shoppers around the globe must invest in effective communications with their target audiences. It starts with presenting a product mix that is dynamically adapted to the local market tastes of international shoppers. It continues with describing those products in a language that the cross-border shopper can understand. It includes customer service that is multilingual and accessible during business hours for that time zone.

We here at Morningside would like to take this opportunity to wish you all a wonderful year of meaningful communications with your customers around the globe.

 

 

References
[1] Abigail Singer, 2016 Holidays Gone Global: How to Maximize eCommerce Revenue, Riskified, November 10, 2016
[2] Stacey Rudolph, How Cross-Border Ecommerce is Growing [Infographic], June 3, 2016
[3] Rachel Martin, The continuing rise of cross-border ecommerce: The 2016 Pitney Bowes global online shopping study
[4] X-Border Merchant Rankings: And The eLeader Is…, PYMNTS, October 7, 2016

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