The co-founder of marketplace trading platform Neteven provides a guide to the opportunities available for smaller European retail brands in the US, and what you need to know about the market.
With the US labelled as one of the global leaders in the ecommerce market, it is not surprising that non-US sellers clamour for its attention when looking to expand. In 2014, the US ecommerce market was worth $304.91 bn and with a growth of 15.4 per cent year on year, the US is expected to stay as the second-largest retail market by 2018 with a predicted $500bn market value. China is predicted to be in first place with the UK in third.
The importance of customer service
Exporting to the US – where each shopper is predicted to spend an average of $1,700 online this year – is an exciting opportunity for brands and retailers. However, it is important to have a well-rounded strategy in place as this market requires significant technical, legal and financial investment.
Fully integrating with the local leading marketplaces, which are open to third-party vendors, provides a real risk-free solution. This is also a great way for brands and retailers to gain the visibility they need to leverage the marketing efforts and reach the popular American websites.
As each marketplace has its own integration system, it is also important to consider the balance between supply and demand before expanding into a country as large as the USA. Prior to distribution on these channels, retailers need to ensure that the business can manage the audience, order process, product structure and several payment options.
It is also essential to stay ahead of local competitors by keeping shipping costs competitive and ensure that fulfilment services and options are reliable and efficient. Furthermore, it is also necessary to maintain a high level of customer service along with streamlined management of returns. This is because a bad customer experience can be communicated instantaneously and can also severely damage a business’s reputation.
Customers are also looking to social networks in order to help guide them when making a purchase so it is vital to have a presence on social media, whether it is for brand building, promotional purposes or to manage customer services.
Initial requirements before selling on US marketplaces
Although there is an abundance of marketplaces available for brands and retailers to sell online, it is wise to do some research first on leading sites such as Amazon and eBay which have long dominated the ecommerce markets.
One thing to bear in mind is that retailers will need to fulfil certain requirements before being allowed to sell on these marketplaces. It is important to streamline the process and optimise your data to have competitive advantage, especially given the maturity of the American ecommerce market.
In terms of local marketplaces, there are numerous examples aside from eBay and Amazon, with Walmart, Rakuten.com and Best Buy to name just a few. This reflects the huge opportunity for retailers to integrate themselves within this space.
Despite the significant economic and cultural changes which have occurred over the years, the US will likely remain the top export destination for international brands and retailers in the future. Provided with the support from governing bodies like UKTI and having a solid strategy in place (formed with the help of an ecommerce and technical partner), smaller UK-based retailers are fully capable to succeed in the US market.
Greg Zemor is the co-founder of marketplace trading platform Neteven.
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