Brands who have successfully launched in international markets share the blueprint for success.
With 20 per cent of retail sales set to be cross-border trade by 2022, finding international markets for your product is more important than ever.
At Shopify’s Commerce + event last week Australian beauty brand Frank Body and bespoke New Zealand apparel company I Love Ugly revealed the strategy behind their successful international launch.
Frank Body, an Australian skincare company selling all-natural coffee scrubs, has had huge success launching globally, with 60 per cent of sales in Australia, 30 per cent in the UK and Europe and a number from Saudi.
Jess Hatzis, co-founder of Frank Body told the event that one of the most important lessons from her international venture was being sensible with her international expansion strategy.
It was a failed launch into Moscow based on some misleading Google Analytics data suggesting a number of visits to her site from Russia that saw her learn the hard way with one of the “biggest mistakes” she’d made, losing thousands in the process.
“One of the key pitfalls I fell into was continuing to look for new markets to go into. It’s a really dangerous strategy for some businesses,” she said.
“We had to make the hard call turning down opportunities, seeing shiny new things and having to think of what our mission and purpose is and if it doesn’t fit into that box then you’ve got to make a business decision.”
Valentin Ozich, founder of I Love Ugly, whose motto is think local, act global also said that a brick-and-mortar expansion into the United States was what taught him to be strategic about international ventures, warning other retailers of the “danger” of being led astray by “going where the data is.”
“We had the fatal mistake of only following data – we saw a lot of traffic from the US so thought let’s go open a store. We opened a store in West Hollywood and it did really well but the foundation was crappy. That was our shortfall.”
But this wasn’t the only crucial lesson for the company in their international journey. Staying true to your brand’s origins is also critical when embarking on international ventures, he says.
“We started to cater more to a US market and became more of a US brand, but they didn’t like that. The customers liked us because we were from NZ. So we went back to our core DNA, just us, didn’t try to cater to any specific market, basically kept the brand like it was in the beginning and naturally started to progress and regained our traction,” he said.
Back to basics
But keeping it simple is one of the most fundamental steps in branching out internationally, according to Hatzis and Ozich.
To get the best chance of success in a new market, retailers need to focus on simple, operational steps like localised shipping, Hatzis said.
“It’s the simple steps we follow. Localise shipping. Ensuring everything is always displayed in the local currency. Try and have customer service available in real-time in those regions. And then there’s the boring legal stuff like trademarks before going into the region. You need to tick boxes and do things properly so you can offer a good customer experience.”
From a marketing perspective, having a solid understanding of the customer and their demographic is also essential, she said.
“From a brand marketing perspective understanding the customer locally is the obvious one and really diving into the cultural nuances of each of those customers. Looking at how things flow through PNL is the number one advice I can give you. E.g. things like needing to factor freight is a quick way to go bankrupt
Ozich also agreed that keeping your international expansion strategy simple is critical to success. I love Ugly’s motto is Keep It Simple Sweetheart, warning that the alternative is that it gets CAF (Complicated As F***).
“You’ve got to go back to basics and make sure it all stacks up, and you’ve got the key metrics,” Ozich said.