The “Global Retail E-mpire” report analyses the estimated value of online retail based on Google searches for six of the biggest e-commerce markets, making up half of global e-commerce volumes: the UK, the US, Germany, the Nordics, the Netherlands and France. It predicts that online trade between these countries will grow fivefold in the next seven years, from £15bn in 2013 to £79bn in 2020, as the retail sector becomes increasingly global and interconnected.
Peter Fitzgerald, Director at Google, said: “The global increase in the number of people with internet access coupled with a rise in consumer confidence, combine to provide the ideal market conditions for e-commerce. The success of UK retailers can partly be attributed to operating in the most advanced e-commerce market in the world, but also to the high level of trust international customers have in UK brands and retailers. Looking to the future, any retailer wishing to enter the market must adopt a digital-first strategy to succeed.”
The UK’s online export success has been spearheaded by the fashion sector, where online marketplaces such as ASOS, Net-a-Porter and Farfetch feature among the top 20 most sought after retailers by international buyers. UK luxury and fashion brands are also performing strongly, with Burberry, Dr. Martens and Barbour some of the most searched for British brands from overseas.
Anita Balchandani, Partner at OC&C, said: “Over the next decade, online retail will become increasingly international. This represents a great opportunity for British retailers, by providing new ways to grow and expand. At the same time, international expansion poses many challenges and will require retailers to master new capabilities and complexities.
“As a market matures, and new pockets of demand emerge, localisation will be crucial – from tailoring the range on offer, to ensuring that delivery and payment methods work for each market.
“It is equally critical to localise only where it matters to customers, to avoid the cost and complexity of over-tailoring the retail offer by country. ASOS, for instance, services customers around the world from a single location in the UK but executes its digital marketing activity in a localised way, allowing it to strike the right balance between customer relevance and cost.
“Online marketplaces like eBay create opportunity for retailers of all sizes, allowing them to internationalise at low risk – researching consumer behaviour, testing their online offering and benefitting from the traffic and brand awareness of the marketplace itself. We expect online marketplaces to be part of the mix for retailers particularly in the early days of their international expansion, and to play a complementary role with a retailer’s own website and stores.
“As the global retail landscape continues to develop, we also expect retailers to look for innovative ways of shipping goods directly from the source of supply to the buyer – making international delivery between countries even faster and creating a seamless shopping experience.”
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