E-commerce is increasingly a world without borders. And a big world at that. According to a pair of new studies commissioned by FedEx and conducted by Forrester Consulting, worldwide online buying behavior currently adds up to more than $1 trillion in sales per year, and it’s forecasted to nearly double in the next four years.
The newer of the two studies, “Seizing The Cross-Border Opportunity,” released in December 2014, surveyed more than 9,000 respondents in 17 countries and territories in Latin America and the Caribbean. Forrester also conducted interviews with small-and midsized-business owners in the region who have cross-border e-commerce operations.
Among other findings, the survey determined that 64 percent of Latin American and Caribbean consumers regularly buy online. Of those consumers, between 10 and 50 percent make all of their monthly purchases via the internet. The findings also show that the region’s e-shopping trends are largely influenced by demand for U.S. online merchants’ products. The most popular online purchases in the region include apparel, books and cosmetics.
Other key discoveries:
- Latin American and Caribbean online consumers are more likely than the global average to buy from small and midsized businesses.
- 81 percent of the region’s consumers make online purchases from U.S. merchants.
- 48 percent discover e-commerce merchants through online advertising.
- The region’s online consumers use their mobile devices as well as their desktops. Of those consumers who make online purchases via mobile devices, 91 percent have used them to buy items from outside their country of residence.
Global Cross-border Commerce on the Rise
The FedEx/Forrester survey of Latin American and Caribbean consumers comes on the heels of an August 2014 FedEx survey, also conducted by Forrester, that examined cross-border e-commerce on a global scale. Of the survey participants, 82 percent reported making an online purchase of a physical item from a merchant outside his or her home country.
Though that’s an encouraging figure for would-be e-businesses, the survey also shows that cross-border shoppers prefer to purchase from well-known multibrand retailers and global online marketplaces. This suggests that global online marketplaces such as eBay, Alibaba and Etsy might provide an effective way for smaller retailers to enter the global arena.
But sales platforms aren’t the only issue that cross-border e-tailers need to deal with. While shipping costs and delivery time are top of mind with shoppers, 35 percent of global respondents also cited high duties and taxes as a concern for cross-border shopping. (Canadian consumers find these particularly worrisome.) Every country has specific taxes, currencies, costs and paperwork that shippers need to understand.
One upshot: Smaller businesses looking to sell across borders can’t simply put up products on the internet and wait for orders to roll in. Those willing to learn the logistical and distributional complexities will be better prepared to sell their wares in the global bazaar that is today’s online marketplace.
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- Have you purchased items online from another country?