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Education

Cross-border ecommerce The surprise is the globalization
of this space. A 2018 PayPal survey
found that 48 percent of North Amer-
is taking off – but why? icans purchased goods from foreign
websites. The numbers were higher

By Ralph Dangelmaier everywhere else except Asia Pacific:
52 percent in Latina America, 56 per-
BlueSnap cent in Western Europe, 62 percent in
Africa and 70 percent in the Middle
arriers to buying goods from foreign websites no longer exist East.
thanks, in part, to better payment, fraud and ecommerce technol-
ogy. Globally, shoppers buy from foreign websites far more often To add perspective, total ecommerce
B than previously. In fact, a DHL study (https://bit.ly/3892Jzd) found sales in North America were worth
that cross-border commerce is growing at 25 percent, or twice the rate of $637 billion in 2018; the top 1,000
domestic online retail. But why? retailers sold $147.3 billion to con-
sumers in other countries (https://
The data suggests a growing international market exists for distinctive, high- bit.ly/39iz2vu). That means cross-
value goods sold online. Many of the biggest retailers seem to be sitting it out. border sales accounted for more than
But for small and midsize merchants, this opportunity is massive, and the risks 23 percent of North American sales
are manageable. if we include merchants outside the
top 1,000. Even so, less than half of
Bigger than it looks the top 1,000 U.S. retailers ship their
good to any global region. Why are
A 2019 study by Internet Retailer on global e-commerce (https://bit.ly/3bjGUyI) they sitting out?
found that cross-border sales in North America, Europe and Australia grew
from $2 trillion in 2016 to $3.46 trillion in 2019. Ecommerce is now worth one- High quality worth shipping
sixth of all retail. That isn't a surprise.
Motivations for buying abroad vary.
Some foreign buyers seek goods they
can't find at home; some seek goods
that are more affordable; others pre-
fer boutique or rare goods, which,
by definition, top 1,000 retailers can't
scale. Thus, small and midsize mer-
chants might have the advantage in
cross-border ecommerce. But where
they sell is just as important as what
they sell. Let's compare the United
States and China to explore this.

International logistics company Parcl
crunched 3,000 U.S. orders to get a
sense of where and what Americans
buy (https://bit.ly/2uvFAYV). U.K.
websites were most popular (28.33
percent), followed by Australia, Ger-
many, Canada and France. Of all or-
ders 41.22, were for clothing, shoes
and accessories; beauty and health
products accounted for 13.28 percent;
electronics and computers took about
10 percent.

By comparison, the market intelli-
gence agency Mintel reports that 58
percent of Chinese consumers bought
from foreign websites in 2017 (https://
bit.ly/2Sr7nlo). Chinese shoppers be-
lieve that foreign websites have high-
er quality products, while domestic

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