The UK has always been acknowledged as a leader in online exports, with 2015 hailing the nation as the third biggest online exporter worldwide. It’s reassuring that our success in this area hasn’t changed.
Despite what one may think, Britain’s online SMEs are well-equipped to navigate the unpredictable market conditions flung up by Brexit. This was according to Mark Brant, the managing director of PayPal, who spoke to Real Business about some welcoming statistics the payments business recently uncovered.
SME bosses saw their international PayPal sales rise ten per cent year-on-year from January to June 2016, with the rate of growth trebling to 34 per cent from July to December. The total amount international shoppers spent with UK SMEs also rose 13 per cent per transaction in the last six months of 2016.
This, Brant claimed, was in large part due to UK currency depreciation, making prices cheaper and more appealing for overseas customers.
“When the pound dropped and the buying power of international shoppers increased, we saw a surge in online exports,” he explained. “Of course, lower prices also played a part in boosting international sales, but there were many other contributing factors.”
One such factor was the growing ability to recognise which markets were either the biggest or the most appropriate. In fact, thousands of UK SME bosses threw themselves into the deep end by selling online to a new country between July and December 2016 based on research, with the top five markets being the US, Germany, Australia, France and Italy.
Those British bosses had scored high grades in their homework given that customers from all five markets were said to be typically attracted to new products only available from Britain.
“Another factor to take into account is the state of the webpage itself,” Brant added. “The bosses best placed to benefit from the influx of international shoppers were the ones who adapted their online stores to fit their targeted markets – for example, letting customers browse in their own language, and pay in their own currency. It pinpoints that UK bosses are really opening their doors to overseas business and they’re thinking about how they need to present their companies to customers from different nations.”
What’s more, the research suggested that to be successful in your online exports endeavour, you didn’t necessarily have go above and beyond in terms of innovation.
This was echoed by Brant, who said: “Those looking to garner success need a good product to start off with. Then it comes down to language, payment methods and shipping methods. None of those three factors are particularly innovative, but put them together and you suddenly differentiate your business from the competition.
“It will go a long way in ensuring we keep this boom going. Businesses need to be ready to attract consumers and convert consumers from different markets. Running a business is difficult, you have to constantly be looking at where your sales are coming from, asking yourself the question ‘Can I get more sales by fine-tuning my business to a specific market’ and ‘Can I open myself to a market in which I’m not currently getting consumers from?’ This degree of analysis and hard work is definitely one of the bigger reasons SMEs are going from strength to strength.
“Beyond this, my advice for bosses would be to put themselves in the shoes of the overseas customer. Would you feel at home on your website? Could you easily navigate it? Would you trust the payment methods? There are numerous questions to ask, but as the research shows, SMEs are punching above weight. It’s just great news. It shows that UK business can boom even in the face of uncertainty.”