Expanding your business abroad is the logical next step for successful domestic retailers. Having cracked your home country, foreign markets offer new opportunities and thousands of additional customers. With the British Pound at a new low, overseas buyers are keen to snap up a bargain. It’s an exciting move, and with careful planning you’ll be well placed to confidently make the leap.
Informative data can help eliminate some of the risk involved in this step. To help retailers stand out against the competition in new markets, we initiated a study into the ways delivery and returns offers differ between the primary European markets of the UK, France and Germany. Our aim was to help retailers understand just what is needed from their local fulfilment strategy if they are to cash in on a chunk of the customer’s wallet in each.
As a result, our report sheds new light on the European fulfilment landscape and the varying customer expectations in terms of delivery options, costs, and returns policies. Here are some of the key takeaways from the research for businesses starting to look across their nearest border.
Think local, act global
Retailers looking to expand abroad must first and foremost scout out the lie of the land. For your company to stand a fighting chance, understanding local expectations and competition will be key. Make sure you spend a significant amount of time researching into the availability and popularity of delivery options, costs and speed in your specific sector across each new market, and adapt your offers accordingly. It should go without saying that as a new name, using fulfilment as way to match, or better still, out-perform local competitors will help you get noticed.
Germany, for example, has embraced local non-home delivery alternatives, such as Automated Collection Lockers, while in the UK, Click & Collect is as popular as ever. Offering comparable or more compelling offers will help you compete on even terms with local retailers.
Flexibility over speed
As well as tailoring your fulfilment strategy, it’s important to see where improvements can be made above the standard delivery, pricing and time. The carrier market has hit rock bottom in terms of delivery spend, and three-day standard, one-day express deliveries are now the norm.
As a result, retailers are hard pushed to improve on this, especially in a consistent and cost-effective way. To gain an edge over competitors, businesses would do well to focus more on the customer experience: providing a range of flexible options, ensuring accurate parcel tracking and offering sms based delivery notifications.
Capitalising on returns
Returns policies remain an overlooked battleground. Companies often see returns in a negative light, but the reality is that they remain an unavoidable part of doing business and key part of the overall experience. As the all-important final touchpoint between business and consumer, it’s also a prime opportunity to build brand loyalty and improve the customer experience within a new market.
We found significant differences between the most prevalent returns offerings in the three markets we studied, proving that tailoring your returns is just as critical as delivery. In Germany, for example, the vast majority of retailers offer returns through DHL PackStation and Hermes Paketshop’s networks – make sure your options match up to what’s available if that’s your next market.
Although partnering with leading global carriers may be tempting, they can be pricey and restrictive, and fail to provide a full range of delivery options. Instead, retailers would do well to engage with local suppliers on the ground, who will have the knowledge and flexibility to accommodate regional needs.
Our report also showed that a huge 42% of retailers still charge for returns. Both locally and globally, we urge cross-border retailers to accept returns as part and parcel of doing business – if you’ll forgive the pun – and instead look to absorb the cost of returns into their bottom line. The gains in customer experience and repeat spend are worth it.
A word to the wise
Offering the highest average number of delivery options and most competitive pricing, the UK makes good on its reputation as an ecommerce leader. This has given rise to an assumption that players in other regions are less advanced than their neighbours across the channel – but our study shows that cross-border retailers are catching up and snapping at their heels.
In fact, when it comes to traditional (standard and express) delivery, non domestic retailers are strongly competing with their local counterparts, and edge ahead when it comes to offering free home delivery. In addition, they also offer lower qualifying spend levels for free delivery, at an average £13 less than their local competitors.
Retailers looking to expand must realise that the stakes have changed, and not rely solely on their reputation. The fulfilment landscape is more competitive than ever before, and no retailer can afford to rest on their laurels when making a move across borders. Fully understanding the lay of the land in terms of fulfilment will make mastering any new frontier far easier.
Enda Breslin, Head of Sales and Business Development Europe at leading global omnichannel ecommerce technology and operations provider, Radial
Radial recently released their European eCommerce Delivery & Returns Index 2016. The survey of 100 leading online and multichannel retailers selling in the UK, France and Germany will help you understand customer expectations in each market when it comes to delivery and returns. The report is available to download here.
