Sellers Miss Cross-Border Growth and Business Potential
Freiburg, October 19 2017 – German online retailers are less active in cross-border trade than their international counterparts. According to a recent survey as well as current market data and studies, under 60 percent do business outside of the German-speaking countries. Two thirds (68 percent) make less than ten percent of their online sales in international business, and only 18 percent have customers from abroad. These statistics are included in a new white paper on the “Internationalization of the German Digital Economy” by OXID eSales and TextMaster. It can be downloaded via http://bit.ly/oxid-textmaster. The authors show cross-border business potential and give recommendations for building an international shop presence.
international business: the state of german shops
Germany finishes sixth in the ranking of the most popular international trading places. Only 14 percent of international customers buy from German online shops – significantly less than, for example, from US sellers (45 percent). What is more, international customers are considerably more willing to do cross-border business than Germans. Just one in four (27 percent) German online shoppers buys abroad while some of their European neighbors reach 87 percent (Portugal), 49 percent (Czech Republic), and 67 percent (Ireland). The main reason for a cross-border purchase as given by 66 percent of respondents is the availability of an item.
Graphic: Four out of ten German online shops restrict their activities to their home country
As many as 33 percent of online retailers have internationalized their shops. Ten percent even have branches abroad.
The most popular items for purchasing online across borders are clothing, shoes, and fashion accessories (33 percent); consumer electronics (21 percent); as well as books, music, and media (14 percent).
Graphic: Only one third earns more than ten percent in international business
Percentage of international business
One of the largest obstacles to building an online shop for international customers is language. It is no surprise that German online sellers focus their cross-border activities on countries without a (or only a partial) language barrier. 89 percent of all internationally active German online shops do business in Austria, 77 percent in Switzerland. However, other neighboring countries are attractive as well: The Netherlands (73 percent) and France (72 percent) are the third and fourth most important markets. Outside of the EU, the USA (33 percent) and Russia (21 percent) are the top venues, while China`s share is relatively low at 14 percent.
“The results are clear,” says Victoria Weidemann, Marketing Manager DACH for Textmaster. “German online retailers, agencies, and trade show organizers want to reach customers abroad, they are active in these countries, and they expand. However, many of them do not realize that customers want to be addressed and be able to make purchases in their own languages, not just in English. With 23 different languages in Europe alone, there is a massive untouched potential.”
Strategies for International Success
OXID has three tips for online retailers to build their international businesses:
The Textmaster white paper with the results from all studies is available at: http://go.textmaster.com/lp-de-internationalisierung-deutsche-digitalwirtschaft
Data from the current OXID eSales survey can be found on pages 9 through 15.
More recommendations for internationalization are collected in the white paper “Global Success – 12 Success Factors for Efficient Internationalization.” It is only available in German.