New Year, New Business Strategy: Exporting Tips for Retailers
Coming off of a strong holiday season for retail, it's a good time to look for ways to continue the momentum in 2018. Technology is providing incredible new ways for retailers to connect with customers and to understand and anticipate new ways to offer improved shopping experiences. E-commerce is extending retailers reach to buyers well beyond their traditional market, and falling costs and improved technology are rapidly making e-commerce more efficient for retailers of every size.
E-commerce and other digital approaches offer ways to help reach new, untapped markets. Retailers may assume their growth opportunity is simply extending beyond their community to other parts of the U.S., but e-commerce and other online channels open a broader market for retailers — even a global market.
Reach International Customers
Around 95 percent of the world's consumers are outside the U.S., and while disposable income is not always as high in other countries as in the U.S., that still represents an enormous group of additional retail customers. In many markets, consumers are demographically well positioned to increase their retail spending, and they value "Made in USA" quality.
In the past, U.S. retailers struggled to reach international customers, and even if they could, payment and logistics were obstacles to completing a transaction. Today, however, savvy retailers are using digital marketing to help new international buyers discover their businesses, and are finding that e-commerce makes the payment and logistics details of international transactions more feasible.
Explore the Opportunity
The recent American Express Grow Global Survey found that small and midsized exporters are optimistic about doing business internationally. In fact, 92 percent of existing exporters continue to see international markets as a significant growth opportunity. Furthermore, 73 percent anticipate a growth in sales from international customers over the next year.
The exporting opportunity is clear, but is selling globally appropriate for businesses of all sizes? While an important question, we often find the biggest challenge is simply getting started. Once companies begin actively exporting, they report generating an average of 36 percent of their revenue from export sales.
Start Selling Internationally
In many cases, the efforts retailers are making to reach buyers in their traditional market will also help buyers from new markets discover their business. And similar to optimizing online channels to maximize domestic sales, retailers can and should use their website to their advantage when considering international opportunities. For example, while not every foreign inquiry that comes in through a company website will be a great sales opportunity, retailers should use details of the inquiries and website traffic data to help gauge what international markets to prioritize and how to shape their marketing strategy in these markets.
In fact, nearly half (47 percent) of exporters got started exporting when an international customer found their product online. That's great news for companies that are actively using the internet, social media and various digital marketing tools to attract domestic buyers.
Public e-commerce platforms can also be a useful tool for reaching new customers. Many of these platforms allow global and domestic customers to search for products, and the search results potentially introduce consumers to new companies.
Additional resources to help retailers begin exporting include federal agencies such as the U.S. Small Business Administration (SBA) and the U.S. Department of Commerce, which has offices offering export coaching services and even an e-commerce lab to help retailers sell internationally. Many states have offices which provide coaching and expert advice as well.
Maintain Sales Momentum Year-Round
Exporting offers a growth opportunity, and for retailers subject to the cyclical nature of holiday peaks and seasonal lulls, global buyers offer potential for diversification and more steady sales throughout the year. Technology, particularly e-commerce and digital marketing, put global retail within reach of even the smallest brands today.
Ed Marsh is an export advisor for American Express.
Related story: A Retailer's Guide to International Expansion