A Step-By-Step Guide to Taking Your E-Commerce Business Global

How to expand your e-commerce business globally

According to Statista, global e-commerce sales are expected to surpass $8 trillion by 2027 — representing enormous opportunities for businesses that expand internationally. But is global expansion right for you? 

“I would recommend considering international expansion if you have saturated (or are close to saturating) your domestic market, you know there is significant demand for your products overseas and, importantly, if you have the financial and operational capacity to support it,” advised Adam Hindle, managing director at Fluid Marketplaces. 

If your company is confident about expanding internationally, follow these steps to successfully launch your brand worldwide.

1. Invest in a global-friendly website.

Your e-commerce site will be vital to your global expansion’s success, so ensuring it provides an excellent user experience is crucial. To provide a great customer experience as you expand, you must optimize your site for international business. Consider the following best practices:

• Choose the right e-commerce platform. Partner with an international e-commerce platform, such as Shopify, designed specifically for global reach. An international e-commerce platform can handle a global market and will enable you to offer location settings and customize your website’s language, pricing and shipping rates for your international customers. 
• Optimize page load speeds. Consider how quickly your website loads in different countries. For example, if your main server is in the United States and a customer clicks on your URL in India, your page could take several seconds to load. While this may not seem significant, page load speed According to Google, 53 percent of customers will exit a site that takes longer than three seconds to load. Use a host that includes content delivery networks to speed up your website. This approach distributes your website’s pages globally through a connected network of cache servers to boost loading speeds.
• Prioritize site quality. Your e-commerce website’s quality will affect your bottom line, so take great care with its design and features. Ideally, you’ll have an accessible e-commerce site that uses responsive web design to provide a great customer experience on all devices. 
• Adhere to regional data privacy laws. Michelle Nguyen, product owner and marketing manager of UpPromote, cautioned that businesses must understand applicable data privacy laws, such as the General Data Protection Regulation (GDPR), when growing their e-commerce activities abroad. “Regarding gathering, storing and using customer data, different areas and nations have quite different needs,” Nguyen explained. “One such example is the GDPR of the European Union, which lays rigorous rules on how companies might treat the personal data of EU citizens.”

2. Identify the foreign markets where you have the best chance of success.

Although nearly anyone with an internet connection and a web browser can see your global e-commerce site, you should conduct research to select the international markets you’ll concentrate on. You’ll likely want to consider the largest e-commerce markets in the world with significant demand. But you should also weigh income levels, import laws and tariffs, low competition in your market segment, and affordable shipping options.

Note that you may need to make changes and adjustments to your products and practices to align with local markets. “To better fit consumer tastes in the new market, this can call for modifications to packaging, price, or even particular product features,” Nguyen explained. “Resonating with clients worldwide depends on careful localization.” 

3. Evaluate if local suppliers are an option.

If your products are sourced and resold, not manufactured by your company, consider sourcing them locally. Using local suppliers allows you to eliminate international shipping costs and improve your margins. However, you must verify local suppliers are: 

• Reliable
• Equipped with the manufacturing capacity and expertise to produce products according to your specifications
• Able to manufacture products with the requisite quality to uphold your brand standards

After finding a local supplier, you must negotiate a contract that makes good business sense. Your company should provide significant oversight, at least at the beginning of the relationship. Have both your lawyer and a local business attorney review the contract before signing it to make certain it’s in your best interests and addresses local business laws and regulations.

4. Create a marketing strategy for international expansion.

Gaining brand recognition can be tricky when expanding globally. Your e-commerce marketing strategy will require specialized approaches for the international market. Consider the following tips and best practices.

• Gather a savvy team. Assemble a globally minded marketing team with specific knowledge of each international target market. Your online customer base will dramatically expand, so your marketing team must understand your audience’s shifting demographics, preferences and needs.
• Adapt your website and social accounts. You and your team must create market-specific versions of your website and social media accounts that use local languages and consider local preferences in messaging, colors and graphics, influencers and market positioning.
• Take advantage of appropriate communication channels. Some popular international communication platforms may not be as widely used or available in the U.S. For example, QQ/QZone is a widely used chat app in China, while Skoob is a prominent social network for readers in Brazil. Failing to leverage these platforms effectively could limit your reach and hinder your brand’s growth.
• Understand the local culture. When you’re ready to launch in a new market, be sure you and your team understand the culture and consumer behavior. Consider hiring local freelancers for each expansion area to keep properly written advertising messages that are effective and observe international business etiquette.

5. Consider partnering with a local company.

Working with a local partner can help you scale up quickly. Local distributors and partners possess deeper knowledge about customers and can facilitate the quick, affordable delivery of products. They can handle customer support in the local language and maintain repairs and exchanges in a timely fashion. Strategic partnerships can also help you navigate import laws and potentially reduce government fees levied on foreign companies.

6. Ensure consistent quality across markets.

Ensuring a consistent customer experience is crucial when taking your e-commerce business global and requires a close look at your processes and decisions. 

For instance, partnering with a local drop shipper may save money, but if the business delivers lower-quality products, your brand reputation could suffer. Similarly, your customer support quality must remain high. Your support team must be capable of communicating with your customers in their languages and be properly trained to provide high-level service.

7. Carefully monitor your global expansion’s progress. 

Going international can be risky, especially if your brand name is relatively unknown in a vast new market. There’s always a chance things won’t pan out or gain traction. For this reason, your team must consistently track the numbers to determine whether global expansion is the best move.

Sales numbers are an obvious metric, but other data points can signal whether or not your brand is gaining acceptance. Monitoring website traffic, social media followers and engagement, and repeat buyers will help you determine whether your customer base is actively growing and if your brand is successfully breaking into the new international market.

Remember, it can take time before you see significant results. However, if things slow down or remain stagnant for an extended period, it may be a sign to explore other opportunities. Thankfully, with e-commerce and online selling, this is relatively easy to do. If one country or international area doesn’t work out, you can shift your focus to another.

Mistakes to avoid when taking your e-commerce business international

Expanding your e-commerce business to other countries can grow your market, but there are also significant risks. Avoid these common mistakes when going global.

Not doing sufficient research

Before launching your business in a new international market, research it thoroughly to set up your product or service for a good chance of success. Your market research plan should include the following assessments: 

• Market demand: Is there enough demand for your product in this market? Look at competitors to gauge market demand, especially at your price point. Factor in additional costs associated with doing business in that market to arrive at a price, and then compare that figure with competitive products. Do you stand out from the competition? Or is your product a lesser-known version of a known entity?
• Additional costs: Doing business in other countries involves added costs. For example, foreign exchange rates can fluctuate and hurt your profit margin. Shipping products to foreign countries is more expensive due to additional shipping expenses, tariffs, taxes and customs fees. Have a firm handle on these extra costs to heighten your venture’s profitability.
• Laws and regulations: Laws and regulations vary widely in different countries. For example, the European Union has extensive data use and privacy regulations and laws surrounding sustainability and genetically modified organisms (GMOs). Aim to meet or exceed all regulatory requirements and e-commerce website security laws ahead of your launch. 
• Political climate: Any business operating in a foreign country must be aware of and sensitive to the political climate and regional stability. For example, civil unrest, political upheaval and new governments with different priorities can significantly impact operations. Similarly, trade wars and rising or new tariffs can suddenly affect business. Know the risks and have contingency plans for various scenarios as you expand.
• Reliability of international partners: It’s crucial to research any partner you use for logistics, customer service and manufacturing. If possible, visit prospective international partners before hiring them. Get references, especially from firms they have done business with in the U.S., to identify any potential difficulties. 
• Sensory preferences: Consumers in other countries may have different preferences and expectations than U.S. consumers, so researching is essential. For example, if you sell a scented product like soap or perfume, you should be aware that consumers in Japan prefer much lighter scents than Americans. Additionally, colors may have varying connotations. For example, in the U.S. and Europe, red correlates with excitement, danger, love and sensuality. However, in former Soviet bloc countries in Eastern Europe, it indicates the repression of communism. Likewise, in the U.S., green evokes the environment, progress, luck and wealth, but in Indonesia, it is an extremely negative color that represents exorcism and infidelity.

Trying to do it all at once

Much goes into successfully launching a venture in another country, so taking your time and doing it right is essential. If you try to launch internationally all at once, you are bound to cut corners and fail to analyze and set up each new market properly. Instead, create a strategic plan for your international expansion. This plan will provide a road map, enabling you to roll out each new market, make adjustments as needed and become profitable before moving on to another location.

Not understanding your target market

You may have a great understanding of your U.S. market, but this won’t automatically translate into comprehending the characteristics of your new target markets. While some places may share similarities with American customers, there will also be differences. If possible, contract with a local market research firm to learn about the target market in each country or review existing studies. Talk to your international partners to get a better handle on conditions, such as the economy and cultural trends that may impact product demand. 

Neglecting to collect required taxes

Just like you must collect appropriate sales tax in each state you do business in, you are required to collect all applicable taxes in every country. Failure to do so can get your company in trouble with the local taxing authority. Be sure you know the amounts and nuances. For example, in the EU, there is a value-added tax (VAT) for all imported products sold to EU citizens, but the amount varies by country.

Not offering preferred payment methods

Your e-commerce payment options matter when doing business in different countries. In different countries, customers prefer specific payment forms, so accepting them is essential. For example, in Germany, Giropay — a payment method that uses customers’ online banking accounts — is popular. In the Asia-Pacific region, customers tend to prefer bank wire transfers for online purchases. In China, Alipay and WeChat Pay are the leading digital wallets.

Listing your prices in your home currency

You likely don’t know the exchange rate between dollars and other currencies, so don’t expect your customers to. Instead, prices can be displayed in the local currency in each local market to create a seamless shopping experience. Listing prices in local currencies will reduce bounce rates and improve conversions. 

Not properly managing currency conversions and exchange rates

Failure to effectively manage currency conversions and exchange rates is a common pitfall for businesses expanding internationally. Unexpected fluctuations in foreign exchange rates and conversion fees can lead to significant financial setbacks if not addressed proactively.

“Foreign exchange volatility and currency conversion costs can also erode profit margins if not managed carefully, as fluctuating exchange rates and conversion fees can add unexpected expenses,” cautioned Kellianne Fedio, founder of Kellianne.me. “Companies should consider currency hedging or flexible pricing strategies to mitigate these risks.”