Connecting with Global Buyers: The Best Localization Strategies
With the global eCommerce growth accelerating, entering new markets and addressing needs of local customers is a must. But where to start?
Expansion and growth are naturally the dominant goals on the horizon for any eCommerce business, and taking your business global is among the most effective paths to accomplishing this. Today’s business climate relies on digital interactions and transactions more than ever before, and advancements in technology have also made this easier.
A report from Goldman Sachs in late July of 2020 estimates that global eCommerce growth will reach 19% in 2020, compared with the 16% rise earlier predicted. “This acceleration is being driven primarily by faster growth in the US, Western Europe, Brazil, and most of the APAC,” the report states. “More broadly, we expect that … eCommerce penetration will reach 22% by 2023.”
Today, 85% of the world’s purchasing power is outside the US. China is the world’s biggest eCommerce market, with an estimated $672 billion in online sales each year. The US follows at $340 billion, but not far behind are the UK, Japan, Germany, France, South Korea, Canada, Russia, and Brazil.
The unexpected and disruptive COVID-19 pandemic has increased eCommerce penetration globally, with the greatest increases in categories such as home entertainment, work productivity tools, and online grocery ordering and delivery.
Expanding globally means more markets, and more markets mean more customers, but your expansion must be navigated carefully. Succeeding with global buyers means addressing each market individually. Buyers want to have a shopping experience that feels familiar, so every step should be localized as much as possible. You’ll need to consider cultural values, etiquette, and other norms of the regions in which you plan to sell your products or services.
In order to be successful in your global expansion, localization areas will need to be prioritized, including language, formats, design, pricing, and payment preferences; understanding the shopping habits of your new customers; and keeping track of regulations and tax requirements.
Localizing the buying process
There are many important components to be localized in order to improve conversion rates with your new global customers. Your goal with localization is to make their purchases easy and intuitive instead of confusing and off-putting. Here are a few things to consider.
Translating your website (or at least your shopping cart) is the minimum. While English accounts for over 70% of eCommerce transactions worldwide, 80% of transactions in many countries take place in their native language. In 2019, the top 10 non-English speaking countries generated 20% of digital commerce sales worldwide — a slight decrease from 22% the previous year, but still a significant portion.
Alconost specializes in website translation and content localization, and you’ll find many related resources in this blog. Now let’s dive into some specialized areas of eCommerce, which need to be tailored to your shoppers’ preferences depending on their locale.
1. User experience localization
The user experience, or UX, is more complicated than it might seem at first glance. Even if your product’s interface matches your own cultural norms, it can look odd and unfamiliar to users from another culture. Some examples:
- Name fields in your shopping cart: In some regions, like the UK, there are traditionally three name fields: first name, middle name, and surname. In other areas, like Asia, users may expect just two fields. In some Eastern European countries, shoppers may be more accustomed to seeing the surname field first. Shoppers could be thrown off (and perhaps abandon the website or shopping cart) if they see something unexpected.
- Language length and font-size: Some English words you may use on your site can be dramatically shorter or longer in another language. “User,” for example, is Benutzer in German and Utilisateur in French. This can affect layout and readability.
- Right to left (RTL) and left to right (LTR) displays: Not all languages go from left to right, like English. Some are right to left (RTL), which can change the timing and sequence of actions users take. English-language screens will show “Next” and “Back” buttons on the right and the left, respectively, but a website localized into Hebrew will have them on the opposite sides.
- Colors, graphics, and formatting: An American or a European may be thrown off by an Asian website, with its patchwork of text, images, gifs, animations, and icons. Asian web design can seem busy to Western users, who are more accustomed to having information broken up into chunks, while users in Asia are more comfortable seeing information in a block.
It may be helpful to look at how widely the website below can vary depending on the geo of the user. If you’re looking for an air conditioner, what turns up in your online search will differ significantly depending on whether you’re searching on the English-language version or on Amazon Japan.
A few differences: the English version uses symbols to show features instead of extensive text, while the Japanese products have longer descriptions (or at least they look longer to someone who doesn’t read Japanese). English product titles are in bold black; Japanese titles don’t seem to be differentiated from the remainder of the product text, which is blue.
2. Shopping cart localization
Localizing your shopping cart is likely the most critical piece in your efforts to increase your bottom line with global customers, but it can be time-consuming and difficult. Unless you have an unlimited budget, you’ll want to tailor your cart to the markets that bring the most revenue and make sure you can navigate customers in different directions, based on their geographic location, when they arrive to make a purchase in the cart. When optimizing your cart, you have two routes from which to choose:
- Manual localization, which involves designing different landing pages (or even entire websites) for your different top markets, which can drain your time and budget resources.
- Automatic localization detects the customer’s geo and provides a cart based on their geographic preferences. Automatic localization is easier, less prone to human error, and most eCommerce platforms offer it.
Cart flow preferences vary for different regions, and shoppers expect their experience in your shopping cart to resemble the norms of their own country.
The most common formats are one-page and two-page flows. The former have no review page after the summary of charges and checkout; the latter including a review page. Shoppers in different regions prefer different things: for example, US shoppers prefer a one-page flow, while EU shoppers prefer the two-page flow with the review page included. And preferences can actually get even more granular at the national level — within the EU, 2Checkout platform data suggests that Germans favor flows without a review page, whereas the French convert better in checkout flows with a review. Tests have shown different results for different target markets. Know your market, keep testing, and cater to its expectations!
3. Pricing Localization
It’s important to be transparent and regionally appropriate when pricing your products and services for the global market. Give the shopper the opportunity to view the price in their local currency, including all applicable taxes and fees. GeoIP technology, for instance, can detect their location and automatically display their local currency.
It’s also important to be mindful of the fact that a competitive product price in one country may seem exorbitant in another. It’s critical that you be able to localize the pricing based on the economic status and the cost of sales and support for each market where you’re selling.
4. Payment Methods Localization
Not surprisingly, shoppers also have payment preferences depending on where they live. Payment localization is among the most important factors in their decision on whether to complete a purchase in your cart. Offering a combination of global and local payment options definitely leads to higher conversions, while local processing (which happens behind the scenes) leads to higher approval ratings.
Some interesting statistics by country reveal how widely payment preference can vary from region to region. Although credit cards and PayPal account for about 86% of worldwide online payments, in China, for example, 79% of web orders are made using either Alipay or WeChat Pay: offer these two, and you’ll see a 48% higher conversion rate. In Brazil, Boleto and cards with installment payments are very popular, accounting for more than 50% of web orders; SEPA Direct Debit is popular in Europe, while Japanese shoppers also use their local option Konbini.
Setting up different payment processors for every country you sell to can be cumbersome, however. If you plan to expand into many different regions, it can be preferable to partner with an eCommerce platform (such as 2Checkout) that can help provide the following smart payment capabilities:
- Intelligent payment routing can route and re-route payments between gateways as a failover mechanism and increase card authorization rate.
- Account updater services ensure automatic updates of customers’ card expiration dates from the issuing bank.
- Retry logic enables you to minimize failures and recover up to 20% of failed transactions.
- Chargeback and refund management can reduce both, and ensure accurate and timely payments as well as financial reconciliation.
5. Tax and Compliance Localization
Whether you’re based in the US or another country, you still have to manage, collect, and remit taxes and value-added tax (VAT) for every transaction, and these vary from country to country. To complicate matters, different rules apply for consumers and for businesses.
Ultimately, you need to be able to charge the correct tax amount for each market, then remit those taxes to the appropriate fiscal authorities. Templates can automate this process, especially if they are equipped with GeoIP location detection that can identify the shopper’s locale. Tax calculators are also available if you need some help in this area. However, for businesses that want to focus on marketing and selling their products and services globally, partnering with a provider to manage all these details might be the best bet.
Compliance is another important concern for businesses that are going global. The General Data Protection Regulation (GDPR) in the EU, followed by California Consumer Privacy Act (CCPA), to name just a couple of examples, has regulated how businesses collect, store, and use shoppers’ personal data, to protect their privacy.
Brazil also passed a new privacy law that makes sweeping changes to its existing data protection standards, impacting not just businesses operating there, but also those without a physical presence in Brazil.
Again, to ensure compliance, it is recommended that businesses partner with a digital commerce platform that can ensure compliance with the standards of these different privacy laws, as far as the purchase process is concerned.
6. Support Localization
Naturally, when a customer is frustrated or having an issue with your product or service, they would probably prefer to speak to a customer service rep who is fluent in their own language. Ideally, your help content and user manuals should also be localized. Both these things will help ensure a better customer experience.
Customers also expect to be kept informed about their orders: confirmation and welcome emails for your global customers should be perfectly translated, well-formatted transaction summaries, including what was purchased, the price paid, and the payment method. Additionally, a strong localized social media presence can form an important part of your customer service strategy.
Conclusion
As the digital goods and services market continues to explode around the world, merchants are in an ideal position to take advantage of these new markets to increase their revenue. Localization is a key component for ensuring a business’s success, but it can be complicated and burdensome for companies to manage the complexities of eCommerce in multiple countries.
To achieve optimal success in global expansion and create a positive experience for users on every market, businesses may find they need the help of a partner. The right localization platform can help navigate the nuances of foreign markets and ensure that businesses meet tax and compliance regulations, freeing them to concentrate on innovating their products and building customer loyalty.
Finally, don’t forget that each business is unique in its own way: you should always be testing to learn what works best for you and your global customers.
About the author
Marius is a Product Manager for eCommerce & Ordering Engines at 2Checkout (now Verifone).
He is a product management expert and has a strong marketing background, with 15 years of experience in building the vision, strategy, and roadmap of digital products.
About Alconost
Alconost, a professional translation and localization company.
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