MENU

Tackling Niche Countries

LinkedIn Twitter Facebook

 

Chris Jones

Author: Chris Jones, Independent Multichannel Retail Consultant

 

Localising to lose

 

I remember some years ago being invite to consult to an online retailer of mid-prices watches. They sold internationally recognised brands such as Seiko, Omega and so forth, and had just invested a significant amount of money translating / localising their site for a neighbouring country. They then spent another significant sum on PPC marketing to bring customers from that country to their newly localised site. Resulting total sales: zero.

 

Why? Because there was simply no reason for a foreign customer to buy there. They weren’t cheaper than local retailers, they sold nothing unique, the ranges were readily accessible in their target country, delivery inevitably took longer than local players could achieve, and their site wasn’t otherwise special.

 

Why Niche Countries?

 

One obvious way to overcome these difficulties is to be a brand and / or manufacturer. Theoretically you have unique products available for foreign customers. Quite likely you already see a reasonable level of traffic, and even (if you offer shipping) purchasing, from attractive target countries. For established brands, however, there’s usually a snag: typically they have well-established overseas distributors already in place in such countries. Targeting the same end-customers via your own online store is apt to be unpopular if not actually futile.

 

So what other options are there? One possibility is to look for places where your product-range is still reasonably unique. It’s unlikely that you’ll find such destinations in a “mainstream” online country such as USA, Germany, Australia or Sweden. But there are niche possibilities.

 

Croatia Case-Study

 

One such possibility is Croatia, which I visited recently to present at a retail conference, and which I’ll use to illustrate some key points.

 

To begin with Croatia is small: only 4.4 million people. It’s also not apparently particularly wealthy: average wages are 26% of the UK figure. Only 22% of its population shopped online last year compared with 79% in the UK. Superficially is doesn’t seem very attractive.

 

BUT...

 

Over three quarters of Croatians that do shop online make purchases from overseas sites (see chart ), and it’s a reasonable assumption that those who do so are amongst the wealthiest. The fact that they are shopping overseas anyway makes them good prospective customers.

 

Internet Users and Online Shoppers in Croatia

 

Moreover, the local competition is somewhere between weak and non-existent. There’s no Amazon to start with. eBay is just about to start up there. If you look at international retailers, such as Asos, they might be shipping there but certainly don’t have a Croatian store, while many others (e.g. H&M, Zara or IKEA) are present but don’t have transactional sites for Croatia.

 

OK, there are barriers, but they aren’t as great as you might think.

 

Starting from absolute basics: Croatians do have the necessary devices to access the internet, supported by good broadband penetration too.

 

Device Usage by Country

 

Then, yes you will need to localise your site, although if you already have a German version, the combination of German and English might well make a reasonable initial job of it. There are reasonable local logistics companies (which will typically give you access to the rather similar Slovenia too). Most importantly of all, Croatia is a member of the EU, so a legal framework exists and there aren’t any customs barriers. Croatians pay with mainstream credit cards, and with eBay entering the market, almost certainly also with PayPal in future; there is, however, a local currency to cope with, not the Euro.

 

On the marketing side, Croatians search with Google and network on Facebook, just like their more mainstream-country cousins, so there are few technical barriers to overcome apart from language. And the costs of PPC/SEM type techniques are low compared with Western Europe (around 20%-35% of typical UK costs per click based on a brief analysis (see Global SEM Costs), making it relatively cheap to get going.

 

In summary, a reasonable comparison would actually be with a Northern Ireland where there was effectively NO local competition: not so huge, but possibly a very soft target. In fact if you’re a multibrand retailer, there is even a reasonable chance to develop a first-mover advantage in at least some of your categories.

 

Tempting, isn’t it?

 

LinkedIn Twitter Facebook

What can UK online retailers learn from major sales events in China?

What can UK online retailers learn from major sales events in China?

By cleverly orchestrating a string of headline-grabbing shopping holidays throughout the year, China is reinventing retail. But why are Chinese consumers embracing these shopping frenzies so readily and offers and how can overseas retailers learn from this to gain and maintain the competitive edge?
How WeChat is used for Business

How WeChat is used for Business

WeChat has been a hot topic for many marketers for a long time. However, how much do we really know about the most used social network in China? And how is WeChat used for business?
Ecommerce in Australasia

Ecommerce in Australasia

The New Zealand and Australia cross-border eCommerce markets are booming and it is looking to continue this way for the coming years. With almost 17 million savvy and highly engaged online shoppers in the region, what do you need to know about these eCommerce markets and which are the most successful retail sites there?
Ecommerce shipping to Australia

Ecommerce shipping to Australia

It’s easy for any retailer to be attracted to the impressive digital adoption Australia has taken with online retail sales of USD $9.5 bn last year. However, this success is not without its challenges as shipping into this widely fragmented country can affect your business - but how?
Online retail in the Nordics: which payment options to offer

Online retail in the Nordics: which payment options to offer

People foreign to the Nordic region might not realise that the combined markets of Denmark, Norway, Sweden and Finland are in many ways leading the world in payments innovation. And through this, it is also apparent in its consumers’ progressive payment preferences when making online purchases. However, which payment option should online retailers offer when launching in these markets?
How can online retailers earn trust in Belgium?

How can online retailers earn trust in Belgium?

Belgium’s online presence is growing year after year and with a growing healthy appetite for cross-border purchases, what should online retailers take into account if they are to enter Belgium’s eCommerce market?
Delivery preference of Dutch and Belgian online shoppers

Delivery preference of Dutch and Belgian online shoppers

Dutch and Belgian consumers are increasingly buying their goods online, but they differ in how they want those goods delivered. A savvy online retailer needs to localise its delivery options to meet these local requirements. But what are these delivery preferences?
What can UK retailers learn from the Amazon model?

What can UK retailers learn from the Amazon model?

Amazon’s reach is so pervasive that it’s overtaking Google to become the search engine of shopping. And it’s just as attractive for retailers as it is for customers, allowing brands to offer their products to the biggest audience in eCommerce, and offering attractive and easy fulfilment options. But what can UK retailers learn from the successful Amazon model?
The fundamentals of retail: Which European countries are leading the way?

The fundamentals of retail: Which European countries are leading the way?

From delivering on promise, to quickly resolving contact centre queries, to minimising the amount of returns, there are myriad aspects for retailers to get right when it comes to delivering a great customer experience. But which European countries are most successfully delivering on the fundamentals of retail?
Beyond Black Friday: Unmissable international events for 2017 eCommerce plans

Beyond Black Friday: Unmissable international events for 2017 eCommerce plans

In the US, the day after Thanksgiving has been a key focus for US shopping. Now, Black Friday is becoming the unofficial start to the Christmas shopping season in countries across the world. But there are hundreds of other events across the world to be aware of when developing an international strategy. Here are a few...

Contact Us

eCommerce Worldwide
2 Ching Court
49-53 Monmouth St
London
WC2H 9EY

Tel: 0203 696 0980
2016© eCommerce Worldwide

Keep In Touch

powered by Affino

About eCommerce Worldwide

eCommerce Worldwide provides online retailers with all the information, and resources, they need to develop cross-border strategies for entering new markets around the world
Read More