Developing the right pricing strategy for each market is one of the critical factors for retailers to successfully expand overseas, according to a report released last month by Tryzens, the digital commerce solutions company, and Worldpay, the global online payments and risk management service provider.
A range of retailers were questioned — from marketplaces, to niche offering retailers and each specified the importance of developing tailored pricing strategies for individual markets. For instance, Russian shoppers have a high level of sensitivity, and as a result are heavy users of price comparison sites, whereas, Australian shoppers are happy to pay more if they don’t have to pre-register and thus, aren’t as concerned with price.
When asked about global expansion, the retailers agreed the importance of understanding local shopping behaviours, since payment preferences vary broadly by country, for example:
• In Russia, 55.5% of transactions are based on cash. Cash on delivery makes up the bulk of this figure, at 41.2%;
• In China, nearly half of all online payments (44.3%) are made using e-wallets, with Alipay accounting for 30% of these transactions. China is also a marketplace driven eco-system with 80% of digital commerce; and
• In Australia, online card payments are the most popular method of payment (53.4% of transactions).
The full report looks at the key barriers, opportunities and threats retailers face when expanding internationally.
8 out of 10 retailers asked stated that they already have, or are considering, entering new markets. Rising incomes and improved infrastructure have made emerging markets more attractive and more accessible to retailers. However the risks retailers consider to be the most prevalent in expanding into these markets include: ensuring a good understanding of each country’s rules and regulations; and losing control of the brand.
British retail brands are thriving overseas, however with every success story there have also been a number of failures. As the trend to grow internationally isn’t showing any signs of slowing down, retailers looking to capitalise on international markets need to understand the complexities of building a brand presence in overseas markets, in order to be a success story and not a failure.
Cross border trade is growing rapidly, but as the research shows, the retail landscape varies extensively from one market to the next. While international customers are only a click away, it’s imperative that businesses understand regional differences, such as preferred payment methods, in order to tailor the customer experience for best results.
Tryzens delivers award winning digital commerce solutions to clients in the retail sector. Headquartered in London, Tryzens offers platform agnostic, scalable, robust and flexible solutions to support clients’ digital commerce and multichannel services on a global scale. Tryzens’ proven solutions maximise revenues, streamline operations and align online trading with broader commercial objectives.
Over the past 10 years, Tryzens has delivered over 100 large, complex digital solutions for clients in the retail sector. From iconic multi-vertical brands like Harrods, Selfridges, Waitrose, Debenhams and John Lewis, to highly-respected sector-specific names like JD Sports, Austin Reed and Timberland. Tryzens has in excess of 200 staff and is continuing to expand, with offices in London, India, Bulgaria, Dubai and North America.
For more information visit: www.tryzens.com or follow: @Tryzens
Worldpay is a leading global provider of payment and risk services, processing millions of transactions every day. Worldpay is a unification of seven leading retail payment solutions and offers a range of services including acquiring, gateway, alternative payments, risk management, and mobile payments. Worldpay became an independent company in December 2010. www.worldpay.com