A survey of British retail decision makers that we commissioned recently, revealed that over half (59 per cent) consider the US ecommerce market to be the most important outside the UK. Indeed, the US ecommerce market is the single most attractive overseas market for UK retailers right now.
There are many reasons for this. Firstly, the growing US ecommerce market represents a significant opportunity for UK retailers to boost sales.
Forrester predicts that online sales in the US will reach $523bn by the end of the decade, while research suggests that more than 30 per cent of the online shoppers from the United States have made at least one purchase online from retailers based overseas.
Secondly, changes made to US regulations last year have made it considerably cheaper, and in most cases tax-free, for US shoppers to purchase from foreign merchants online.
The introduction of significantly higher duty thresholds in March 2016 made it cheaper for US consumers to buy items up to $800 in value from retailers outside the US, has prompted shoppers to look overseas.
Coupled with the weaker pound following the Brexit vote, and with the high affinity for British brands, UK retailers are well positioned to boost sales to the US.
Clearly there is lots of opportunity for UK retailers to come up trumps by targeting US shoppers online, however our research suggests that there is room for improvement in terms of the quality of the shopping experience being offered to US consumers at present.
Our research findings found that almost half (48 per cent) of retailers that are targeting or planning to target US shoppers are doing so with their existing UK website offering – without any localisation. Furthermore, only 35 per cent are currently targeting, or plan to target US shoppers through a dedicated US offering.
Retailers must give thought to their expansion tactics, and specifically address the challenge of targeting this unique market, including the local competition offerings.
To harness the online opportunity and increase revenue, retailers need to consider how they can improve the online shopping experience for US customers.
Retailers can do this by offering local payment methods, a wider choice of delivery options and local returns, and more transparent pricing, with full delivery costs and tax included. In doing so, they are likely to see an increase in international sales and much more favourable conversion rates.
To crack the US ecommerce market in 2017, there five key things you must consider on the next page.