Increasing the exports of value-added products from emerging nations has been proven difficult for trade promotion agencies in the past. Why this is? Markets like Europe, the US and Canada are inclined to import raw materials and reluctant to try brands made in developing countries. Luckily, there’s a dot on the horizon. The raise of cross-border e-commerce offers new possibilities for innovative companies to reach new markets – but a digital marketing strategy needs to be put in place. Ready to find out how to support your companies in taking advantage of cross-border e-commerce and growing your exports?
Pandemic effect: increased digital purchases
The role of e-commerce overall has been growing in importance in the last few years. Especially during the Covid-19 pandemic, both end consumers and companies have increased their purchases over digital channels – this behaviour is expected even to continue after the pandemic. For the exporter, this is good news! The shift in consumption offers new opportunities for innovative companies to expand their client range outside their country borders. Research on online trade supports it. Worldwide, retail e-commerce sales reached US$4,938 billion in 2021, 47% higher than in 2019, the year before the pandemic.
From B2B to B2C: reaching consumers directly
Both new and established companies have taken advantage of this trend, making use of the diverse online distribution channels to reach new customers. Digital-affine companies with innovative products can now reach their customers directly, whether they are end consumers or B2B customers. This opens room for intermediate and finished goods that might not have found an importer in the past. On top of that, through direct contact with their customers, companies can better adapt products and processes to the customers’ needs, increasing client satisfaction and ultimately increasing sales.
From problem to solution: cross-border e-commerce
Trade promotion bodies are often looking for ways to support exports of products with high added value, bringing higher margins to the country of origin and contributing more and better jobs. Nevertheless, this has been proven difficult. International markets with high purchasing power seem to be mainly interested in raw materials and importers have little interest in new brands produced in developing countries – even in the case of innovative products. Cross-border e-commerce certainly offers alternative distribution channels for companies and promotion bodies should consider supporting their companies in taking advantage of these opportunities.
More than registering on Amazon
Nevertheless, cross-border e-commerce is more than registering on Amazon. For being successful through these channels, companies need to design a specific strategy integrating a strong, legally compliant operation and an optimised digital or hybrid marketing strategy. Promotion bodies can play an important role to support companies in getting ready for this quest.
Here are five key actions promotion agencies can take to support their companies in succeeding with their e-commerce ventures:
1. Advice your companies about the regulations in the markets
The fact that companies are selling online doesn’t mean they don’t need to comply with legislation in foreign markets. Product regulation must ALWAYS be complied with, even if companies are dispatching one single product directly to the consumer. Some countries require an economic operator to be present in the market for selling certain product categories. This is the case in the EU for products like food or cosmetics. Failing to comply with this regulation? Then the product might end up being removed from the market.
2. Look for agreements with different actors in the chain
There are several marketplaces out there where companies offer their products to independent retailers. These marketplaces concentrate in Europe, the US and Canada. Nevertheless, as a promotion body, you can always implement temporal projects – giving the companies access to those marketplaces and, potentially, opening them for your country of origin. Keep in mind, that the price of transportation and fulfilment is key to being competitive. If you are planning to create a programme to support businesses with e-commerce, make sure to include a logistics supplier in the conversation. Whether it is cargo consolidation or negotiation competitive air freight or courier services rates for small companies, offering services in the logistics area can be a game-changer. Remember, an institutional partner generates trust and can open doors!
3. Help the companies build a solid operation
Companies need to identify which channels are the most suitable for their product. Whether it is a marketplace, their own website or if they want to sell through social media – they need to know how to deal with returns, which incoterm to use based on the type of client and what software is needed to manage production and stock. A solid operation is the basis for a profitable e-commerce venture. Help your companies climb the e-commerce learning curve faster!
4. Advise them to develop a digital marketing strategy
Not only the operation needs to be put in place. In order to sell, companies must reach their customers. Therefore, it is key to have an e-commerce optimised marketing strategy, including a website with a high conversion rate and an SEO strategy supported by social media and ads. The quality of images, videos and translation have to be a priority since this is the only thing e-customers will perceive of the companies.
5. Be a role model
You can hardly convince companies to participate in e-commerce and create a digital marketing strategy if you don´t have one of your own. Optimise your website, social media and other online channels and create a digital strategy for your organisation. Be a leader in your country – companies will follow.