Expanding into new markets can be confusing and difficult. Here are some areas to research before deciding the next steps for your business.
Though the world has become more easily accessible thanks to the internet, planes, and other technological advancements, there are still so many cultural, economic, and geographic differences around the globe. While tapping into new markets is important for growing your business, doing it the wrong way can spell disaster. So, what should you consider about new countries or regions before you take the plunge?
Although this may seem obvious, it is also one of the biggest challenges that companies will face in new markets. While many places around the world do have at least a small English-speaking population, you’ll reach more people by having local languages represented on your site. Google translate can be helpful, but languages are complicated. The last thing you want to do is offend your customers because of language issues. Consider hiring a translator to test all your pages or finding an extension to help in the Addons Marketplace.
Consider China: There are numerous languages spoken throughout the country, and many regions have individual dialects that can cause confusion even among native speakers. While population centers are more likely to have diversity, estimates suggest that only about 10 million out of the 1.3 billion people living in China speak English. The rest speak one of the hundreds of dialects of the main Chinese varieties. This could mean a heavy investment in making your site friendly to Mandarin, Wu, Min, Yue, and other main Chinese languages as well as a variety of regional dialects.
Countries, and even regions of countries, will also have significant variation in infrastructure. If you’re used to selling and shipping within the United States, it may be difficult to navigate the issues that come with selling and shipping in other countries. Internet penetration is often lower, roads and air traffic can be far more limited, and delivering products to customers can lead to unexpected issues, especially in rural areas. Knowing what areas can be serviced in any market will be essential for customer satisfaction. Being able to deliver a product on time and in good quality may be difficult, and significant delays can cause damage to your company’s reputation.
Consider Argentina: Latin American countries often have different infrastructure plans than places like Europe and the United States. Argentina does offer some equivalent infrastructure. With an internet penetration rate of almost 80% in 2018 and over 1300 airports, the country is more prepared for eCommerce than some of its neighbors. However, only 142 of those airports have paved runways, and less than 30% of the roads throughout the country are paved. This can lead to shipping delays and logistical problems for deliveries that don’t exist in other countries.
Money habits vary widely around the world. Some countries run mostly on cash, others rely on credit, and some have moved to mostly digital wallets. Even more problematic, money habits can also change based on region in a specific country. Rural areas may need different payment options than cities or more urban areas. Understanding how people in a specific country make purchases is essential and may require some additional research. Look into country specific plug-ins and how payments are accepted with PrestaShop before selling in a particular country.
Consider Australia: Payments in Australia are relatively straightforward. Nearly 70% of payments are credit or debit cards. However, the other 30% is almost entirely PayPal. While mobile spending is growing, digital wallets are currently not as popular. Because of this, expanding into Australia means you may need to accept a variety of credit cards and have a PayPal option to reach the most customers.
Often the most confusing aspect of moving into a new market, discovering all the applicable laws and regulations can be exhausting. There are often specific rules in every country about the types of products that can be sold.
For example, some countries do not allow fruits and vegetables or plants to be sold from other countries for due to agricultural or environmental concerns. Other countries limit alcohol, weapons, or even books and toys. UPS can be a great resource for better understanding these customs requirements.
And beyond rules around commodities to sell, there are often be rules about the business itself. This can be complicated, so a business looking to expand into any country work with a legal representative from the country to ensure they follow all laws before making any sales.
Consider India: To limit the power of foreign companies like Wal-Mart and Amazon, India changed its regulations around inventory-driven models of eCommerce in 2018. While many smaller eCommerce businesses may be unaffected, the rules can complicate things for companies that use drop-shipping, reselling, or bulk purchases.
Cultural and marketing concerns in a new market are much more difficult to discern than the other categories on this list. While some things may be easy to understand and research, cultural norms can be very complicated and nuanced. Understanding how to sell to certain cultures may be the hardest part of expanding. As with language, you can offend your customers if you use the wrong phrases, photos, or even marketing technique.
Consider Japan: In the US, personal relationships and in-person communication have become less common in business. Newer generations often prefer chatbots, text, and email over interacting with another person. In Japan, on the other hand, relationships are very important. Word of mouth or recommendations from a friend are extremely important, sometimes more so than any other marketing materials. Social media can be of some use here, especially with the younger generation, but the personal touch will be essential to success.
If you’re looking to grow your business by expanding into new markets, be prepared to research everything. While it is possible to find some information already collated for you, it will take some digging to ensure that you have all the information you need. The US Department of Commerce is a great place to start, and there are other helpful resources in the PrestaShop blog.