By Aimee Chanthadavong
The demand for Australian products overseas is currently worth $5 billion and this is expected to grow to $16.1 billion by 2018, illustrating there are cross-border opportunities for retailers, new PayPal and Nielsen data shows.
The Modern Spice Routes: The Cultural Impact of Cross-Border Shopping report indicated Americans and the Chinese are Australia’s biggest fans. Thirty-eight per cent of Chinese cross-border shoppers buy from Australian websites and will spend $2.3 billion on Australian goods this year. By 2018, there will be nearly 36 million Chinese cross-border shoppers spending $10.7 billion with Australian retailers. Similarly, 41.8 million American shoppers are expected to spend $4.2 billion on Australian products by 2018, up from 34 million and $2.1 billion this year.
“Cross border trade is nothing new. Our local stores are filled with goods from around the world. What is new is how easy it has now become for consumers to shop online directly from merchants around the world and the massive opportunity that represents,” David Marcus, PayPal president, said.
“The emergence of these ‘modern spice routes’ is great news for businesses the world over. Our message to merchants is if you are looking for new ways to grow your sales, especially in an economic downturn, start selling directly to 94 million cross-border shoppers in these 6 markets and own a piece of this $105 billion market. For consumers, paying for items in a different currency or country has never been easier and we help make it safer with our buyer protection policy for eligible purchases available in 193 markets worldwide.”
To make the most of this potential, however, merchants must first address the key concerns of crossborder shoppers. Seven out of 10 consumers in all six markets cited fear of identity theft and fraud as the top reason for not making a cross-border transaction, with Australia (73 per cent) the most fearful and Germany (63 per cent) the least.
“The best way to ensure customers piece of mind is by using a trusted method of payment, such as PayPal. Additionally, merchants are encouraged to display the PayPal logo on their website, demonstrating they are a trusted PayPal partner,” Jeff Clementz, managing director, PayPal Australia, advised.
The report also revealed the top purchase categories for cross-border shoppers across the 6 markets are: clothes, shoes and accessories ($12.5 billion); health and beauty products ($7.6 billion); personal electronics ($6.0 billion); computer hardware ($6.0 billion); jewellery, gems and watches ($5.8 billion); and home electronics ($5.4 billion).
The top reasons for shopping online from overseas merchants are: “buying online to save money” (80 per cent) and “more variety that cannot be found locally” (79 per cent). Cross-border shoppers are not just looking for an online discount, but also searching overseas for high-quality, authentic items.
“Make it as easy as possible for international customers to buy from your site, by making your international postage and delivery options clearly visible. Also ensure your online offering includes currency converters, and use PayPal to open up your business to the acceptance of 25 currencies. Additionally, break down barriers for international shoppers by offering competitive shipping costs, and ensuring products can be quickly and efficiently shipped to all destinations that correspond with your international web traffic,” Clementz added.