Retail in Asia

In Trends

Expert Opinion: Five key retail practices for e-commerce success beyond borders

With the advances in technology, businesses no longer need to set up physical stores in multiple countries in order to gain a global footprint. Retail expansion is increasingly occurring through online channels as a way to tap into growth markets, build brands, and learn about consumers, while investing less capital than in traditional formats.

An e-commerce site provides retailers with a low-risk option to test new markets and complement existing store footprint. As a result, a number of e-commerce retailers have been aggressively expanding their global customer base in the last decade.

Businesses now face the challenge of handling a larger volume of cross-border transactions. In addition, they also have to take into account consumers’ preferences in different countries, their diverse rules and regulations, banks, payment processors, and most importantly, payment security requirements.

Pursuing international online expansion often means battling with already established domestic e-commerce players that typically own a large market share. Competing against these domestic players requires understanding of online consumers within each market and tailoring eCommerce operations accordingly. Hence, there is a clear need for businesses to deploy a robust global payment acceptance platform to fully realize the business potential of international e-commerce.

The five key things businesses should consider while choosing a global payment acceptance platform that will enable them to extend the reach of their business beyond borders are as follows:

1. Understanding unique payment preferences, while expanding reach

Taking into account the thriving growth of cross-border transactions, businesses need to be aware that payment preferences of consumers generally differ across continents, countries, and even cities.

Adopting a payment management solution that would cover a variety of currencies and payment options would offer customers a vast range of payment options.

Funding and settlement in multiple currencies offers customers flexibility and convenience. This allows for seamless cross-border expansion, making it easier for businesses to penetrate into more markets.

2. Full visibility, whenever you need it

e-commerce transactions form a complex web of payment management procedures, involving multiple channels of worldwide banks and processors. This creates an even more complicated process for the merchant in reconciling payment activity to bank statements. In light of this, businesses need to look for efficient, simplified connections.

Getting access to a full range of reports that standardize payment reporting across banks and processors can simplify the tedious process of reconciliation. In addition, complementing these reports with automated payment reconciliation services may assist businesses in eliminating many of the manual processes associated with payment reconciliation and chargeback management.

Automatic reporting and reconciliation is dependent on the ability of a payment platform to integrate the processes with the payment data into a central reporting system. With an integrated administration interface, businesses can obtain access to reports, case status and administration for simplified payment management.

3. Keeping tax calculation simple and fast

The nature of eCommerce is time-critical, as consumers’ inclination to purchase tends to depend on how simple the payment process is. Therefore, businesses should implement superior real-time tax calculation for sales originating from different parts of the world, so that they can provide prompt and accurate total order amount for customers at checkout. This would then make the payment process for customers fast and hassle-free, further enhancing the customer payment journey experience.

4. Enabling security, ensuring confidence

Businesses should also look out for fraud management solutions that they can use to protect themselves from the risk of online fraud and habitual chargeback offenders. These solutions are usually equipped with the ability to provide the probability of a fraudulent transaction, coupled with a secure authentication process.

When such a secure authentication process is implemented, consumers may be protected from the fraudulent use of their card at a merchant site. This goes a long way towards building consumer confidence in online payment mechanisms, prompting greater use and increased or repeated spending.

5. Scalability and adaptability

With the significant growth of cross-border eCommerce, businesses should also look for payment acceptance methods that are bank agnostic. These equip merchants with the convenience of switching, adding, or removing payment acceptance options at any point of time, without having to replace an entire system.

In addition, merchants should choose a platform that can be integrated with major commerce platforms, sales systems, order management, and Enterprise Resource Planning systems so as to enhance the adaptability to any change.

Despite the challenges, the case to build a strategy for accepting cross-border orders is compelling for everyone – from entrepreneurs to large corporations. How well businesses adapt their eCommerce payment management strategies will be a key factor in determining their long- term sustainability in the growing international eCommerce world, as global B2C e-commerce is set to grow at 20 percent annually to $1.298 trillion worldwide.

Businesses will need a robust all-encompassing global payment acceptance system that is nimble enough to adapt to new market conditions, an expanding customer base, and ever- changing customer needs. This will ultimately help businesses to reach more customers, convert more orders globally, increase revenue capture and retention, get to market faster and scale more easily.