Although many consumers worldwide are now in a state of eCommerce maturity, that doesn’t mean they aren’t still wary of buying online. Consumers are very aware of their personal security online and that’s especially true when they make cross-border purchases from vendors in other countries.
As a vendor, you need to provide constant reassurance to customers so they can buy from you with confidence.
Consumer confidence may vary from culture to culture. In some markets, consumers are particularly likely to be relatively new to online shopping and novice eCommerce buyers have particular needs and expectations.
In more mature eCommerce markets, consumers may be suspicious of buying online based on real or perceived threats from counterfeit or fraudulent sellers. Many markets still aren’t comfortable with using bank cards and strongly favor cash-on-delivery payment methods. For complex reasons, consumers in particular markets may be especially risk-averse about factors such as sharing their personal data online.
There are also markets that perhaps have reason to feel more confident online – there are certain data protection policies within the EU that may help customers in the union feel more confident.
Happy, confident online shoppers
Consumers in the UK are some of the most enthusiastic online shoppers in the world. Internet coverage is high, 87% of UK consumers buy online, around a third of sales have happened online during the pandemic, and in 2020 this eCommerce market was the third-largest in the world.
Although the UK isn’t a huge country in terms of area or population it still benefits from a large enough online population to sustain a thriving domestic online market. The UK also benefits from a shared language with another major eCommerce market, the US. The UK market is often one of the first places US online brands expand into.
UK consumers are notoriously terrible at languages and the idea of buying from a foreign-language site would be fairly alien to most UK consumers. However, the US’s Amazon brand is the most popular online shop in the country.
UK consumers are quite happy buying from the localized version of this major US eCommerce marketplace. What some US vendors aren’t aware of is the need to translate their website into British English, and that includes clothing sizes, before engaging with this market.
One of the reasons Banana Republic is said to have failed in the UK is that it didn’t give customers a clothing size system they could understand. Localization of all elements of your online offering is really important, even if you’re entering a market that seems very similar to your home market and shares the same language.
Declining sales in the UK led Gap to close all its Banana Republic stores to solely trade online. Editorial credit: Sorbis / Shutterstock.com
UK consumers recently cited fear of buying from a fraudulent site as their number one concern preventing them from buying from overseas eCommerce sites.
They also expressed concerns about delayed or damaged deliveries, with further worries about customs – particularly in these uncertain post-Brexit times. Engaging with these consumers means offering reassurance about these concerns. With the relationship between the EU and UK in a state of flux, this may be hard for individual vendors to do.
It’s always worthwhile keeping customers updated where possible, for example readjusting estimated delivery times for UK buyers to give as accurate a delivery window as possible.
Some UK customers were hit with unexpected customs bills for purchases made from the EU, so it may be necessary to make this risk clear to UK buyers before they complete their purchase.
49% of Brits said they would not buy from a website that was in a foreign language. Despite these reservations, UK consumers continue to shop online from vendors in the EU.
The key to engaging these cross-border buyers is making sure they have a fully localized version of the eCommerce experience to give them confidence in their purchases.
Consumers in some of the world’s smaller markets may be more willing to buy from non-localized websites compared to the reluctant UK consumer. European consumers make around 25% of their online purchases from another country, helped by the single market and shared regulatory environment.
For residents of tiny Luxembourg, 80% of online shopping comes from outside the state. They don’t tend to benefit from fully localized experiences online, buying regularly from .de and .fr marketplaces such as Amazon and Bader.
Although not many major eCommerce sites are localized for .lu, the fact that many Luxembourgers are confident speakers of French and German means the experience of buying from French and German language sites is not so intimidating.
Suspicious consumers
China is now the world’s biggest online market with close to 800 million Chinese consumers shopping online. Much of this growth is in the last few years, so many Chinese consumers are relatively new both to internet shopping and to modern consumerism in general.
China’s new but enthusiastic online shoppers remain some of the wariest consumers in the world when it comes to concerns about eCommerce fraud and counterfeit goods. They have good reason to be concerned. It’s thought 55% of Chinese internet users have been the victim of some kind of online fraud.
Brand building is an exercise in building trust with China’s cautious consumers. That’s why Chinese consumers tend to show interest in luxury, high-end products. They want a high-value, well-known brand that they know they can trust. Brand building is really key to reassuring Chinese consumers.
China’s consumers are still bruised from the pandemic and retail sales are somewhat down. Yet there remains an appetite for online shopping and consumers have learned strategies that help them feel more secure online.
Consumers often rely on friends and family for advice and input into their buying decisions; they also rely on reading online reviews. Additionally, they favor shopping through online marketplaces that shoulder some of the responsibility for vetting vendors.
You can help reassure the mistrustful Chinese consumers by selling through the marketplaces they trust. If you have your own website, make sure you allow consumers to review your products.
In this market, people also tend to respond favorably to companies demonstrating social responsibility such as by being active in the community. This also helps demonstrate your local presence.
You may also want to engage – cautiously – with the wang hong (influencer) celebrities. Choose the right personality and you may provide lifestyle reassurance as well as borrow some credibility from a trusted face.
Whilst consumers in some countries mistrust foreign vendors, in China, some foreign brands are trusted more than domestic ones. When it comes to sensitive products such as baby milk, some consumers will actively favor non-Chinese vendors.
Consumers may also prefer to buy branded goods directly from the brand itself to avoid fraudulent middlemen. But consumers are also just as wary of cross-border purchasing as consumers in any other market. They tend to have high levels of trust in goods from particular markets, with Japan and South Korea being the most trusted.
If you’re selling to Chinese consumers, you need to consider having a localized version of your website, even if you’re engaging with them via an online marketplace so they can easily verify your credentials.
Furthermore, a single localization strategy may not be enough. China is a huge and varied market so you may need to approach them in a complex way, enabling multiple ways to pay across many different devices to suit local preferences in this vast country.
Familiar payment methods
Paying for goods online is a significant source of consumer anxiety. Irrespective of where your customers are, providing reassurance takes roughly the same shape. Make sure you have evidence that you are a real, human-led business.
There are many ways to do this but a good ‘About us’ section on a website helps, along with evidence of your physical presence such as a local office address. Show the relevant security logos and trustmarks, which may vary in different markets. Provide social proof, such as customer testimonials and a link to a leading ratings site. Finally, the checkout experience needs to be well-designed and reassuring.
Customers want to use payment methods they are used to and feel confident with. There’s evidence that concern about fraud seems to make consumers less inclined to try new payment methods. These preferred methods really vary in different markets, with some favoring mobile wallets, others credit cards, and some just wanting to pay with cash.
Cash on delivery is generally seen as a huge disadvantage for eCommerce vendors. There’s a much higher rate of non-payments and cancellations associated with this method of payment and the costs for the vendor are higher.
Cash on Delivery is still a popular form of payment for eCommerce businesses in some markets including India and UAE.
Online retailer Flipkart achieved success in India by allowing cash on delivery payments, which helped persuade reluctant online shoppers to buy and allowed Flipkart to gain market share.
When Amazon entered in 2013, it also allowed for cash on delivery payments as it knew this was necessary to gain trust and build market share. When AliExpress penetrated Saudi Arabia as late as 2019 it opened by offering cash on delivery payments.
It’s been hard to persuade customers away from cash on delivery but the method is now in decline in the Indian market thanks to government policy-making and also in part the pandemic. Consumers are now shifting towards pre-payment methods, with major platforms in this market scrambling to offer payment methods that consumers feel comfortable with.
India is a good example of how important it is for vendors to offer payment methods consumers feel comfortable using, even if it’s at the cost of their own inconvenience.
Data protection concerns
Consumers worldwide are showing increasing concerns about their data privacy, partly because these issues are in the news a lot.
There’s also some evidence that increased online activity is directly linked with heightened concerns. We’ve just emerged from a period of rapid increase in online activity, with many people trying to do specific tasks online for the first time during the pandemic, so we may also notice increased anxiety around these transactions. This means brands may have to work harder to reassure customers online, particularly novice ones.
Despite consumers’ stated concerns about privacy, it’s striking that consumers are willing to part with data so long as it’s in exchange for something. This might include things such as products that are more personalized to their needs.
This suggests there’s still room for data collection, so long as consumers see a clear benefit. Obfuscating your reasons for collecting data with a long and convoluted privacy policy is not the answer. Companies need to articulate their data collection reasons clearly and use language consumers understand.
Chinese consumers have in recent years shown increasing concern about this issue and some citizens have launched lawsuits against internet giants such as Baidu for collecting data without consent. China has very recently introduced some of the world’s toughest data privacy protections and we’ll soon see how this impacts how secure consumers feel online here.
In any market you need to be transparent about why you’re collecting data and what you intend to use it for. Many markets are implementing their own data privacy laws, so you’ll need to tailor your approach to fit the local rules.
There’s evidence that a significant proportion of consumers will actively switch away from brands whose data policies they mistrust, so your data approach should be part of your competitive strategy.
The world has recently gone through an unprecedented acceleration of online participation as consumers switch to online methods for some activities and transactions. These novice consumers may have heightened concerns about online safety, so the need for reassurance has never been greater.
There are real opportunities associated with the recent acceleration of online activity but these new participants may need greater reassurance than ever before. There’s no one-size-fits-all approach to making consumers feel safe online and confident in their purchase decisions so you need to approach every market differently.
Having a good localization partner can help you identify common concerns in the local market and adapt your checkout, payment, and data privacy approaches to suit local preferences, instill trust, and increase your chance of success.
