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Ecommerce Benchmarks: Data for Improving Your Online Sales Strategy

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As the global ecommerce market rapidly evolves, you can rely on benchmark data to make sure that your online shopping experience stays localized for every customer. Leverage these key insights from cleverbridge, a global subscription billing provider, to successfully localize the languages, currencies and payment methods for customers in different markets.

Sources:

- [Slide 3] http://www.emarketer.com/Article/Global-B2C-Ecommerce-Sales-Hit-15-Trillion-This-Year-Driven-by-Growth-Emerging-Markets/1010575
- [Slide 4] http://www.retailcustomerexperience.com/news/worldwide-e-commerce-sales-to-increase-nearly-20-percent-in-2014/
- [Slide 5] http://www.statista.com/statistics/272391/us-retail-e-commerce-sales-forecast/
- [Slide 6] http://www.emarketer.com/Article/Global-B2C-Ecommerce-Sales-Hit-15-Trillion-This-Year-Driven-by-Growth-Emerging-Markets/1010575
- [Slide 30] http://www.forbes.com/sites/stevenbertoni/2014/02/12/can-paypal-beat-apple-google-amazon-and-icahn-in-the-wallet-wars/
- [Slide 40] http://www.thepaypers.com/payment-methods/Japan/4
- [Slide 58] http://blog.equens.com/eu/2014/08/real-time-payments-in-sweden-one-million-users-and-still-counting/

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Ecommerce Benchmarks: Data for Improving Your Online Sales Strategy

  1. 1. Ecommerce Benchmark Data Key Insights for Improving Your Online Sales Strategy
  2. 2. The global ecommerce market is evolving faster than ever.
  3. 3. Global B2C ecommerce spending will hit $1.5 trillion in 2014. That’s a 20.1% lift from 2013. Source
  4. 4. By 2018, 47.3% of all internet users in the world will have made at least one online purchase. Source
  5. 5. US online shoppers alone will spend $304.1 billion in 2014, and an anticipated $491 billion in 2018. Source
  6. 6. APAC customers will outspend US customers for the first time in 2014. Asia-Pacific is now the largest and fastest growing ecommerce market on the planet. Source
  7. 7. How can you make sure your ecommerce experience stays properly localized for every customer, in every country?
  8. 8. You need benchmark data. We can help. But first things first — Hello.
  9. 9. We are cleverbridge. We’re a global subscription billing provider powered by proven expertise and leading technology.
  10. 10. We process over 1 million transactions per month in more than 250 countries.
  11. 11. About 80% of our gross revenue is generated here: United States Canada Germany Australia United Kingdom Switzerland Japan The Netherlands France Italy
  12. 12. But we’ve processed transactions all over the place. Including Antarctica, Christmas Island, Vatican City (0.2 sq. mi) and the Pitcairn Islands (population: 56).
  13. 13. Let’s dig in. We’re sharing this data in the spirit of best practices, great customer experiences and outstanding ecommerce.
  14. 14. Ecommerce Benchmark: Language
  15. 15. English is the global language of ecommerce. More than 60% of transactions worldwide occur in English.
  16. 16. Native Languages In many countries, including the US, UK, Germany, Japan, France and Australia, the bulk of transactions (90+%) occur in the language you’d expect ‒ the native language of that country. In the US, 99.40% of orders occur in English.
  17. 17. But there are exceptions. In Canada, Italy, the Netherlands and Switzerland, the percentage of orders place in the native language is much lower — in the 80th, or even 70th, percentile.
  18. 18. 16.5% of online transactions in Canada occur in French. In Italy, 1.9% of transactions occur in German — and 8.5% are in English. The dominant language used by online shoppers in Mexico is English. Spanish doesn’t even come close!
  19. 19. What does all this mean? The secondary languages in some countries with high concentrations of online shoppers are asserting themselves during the ecommerce experience in ways that are meaningful for your business.
  20. 20. Here’s the takeaway. In order to localize your ecommerce experience and convert the most customers, you need to speak their language. Quite literally.
  21. 21. Avoid making assumptions about which language to use. GeoIP technology can identify your customer’s default browser language. Use that data to inform which language displays before, during and after checkout. If you run email marketing campaigns in countries with significant secondary language usage, you need to continue communicating with customers in their preferred language.
  22. 22. Ecommerce Benchmark: Currency
  23. 23. Native Currencies In most countries with a robust ecommerce market, most transactions take place in that country’s native currency. In the US In Germany In the UK In Japan
  24. 24. But there are exceptions. In Australia, Canada and Switzerland, the native currency also dominates — but there is a significant percentage of online orders in non-native currencies. In this situation, the “other” currency is almost always USD.
  25. 25. In Australia, only 82% of online orders are in AUS Dollar; 17% of orders are placed in USD. In Canada, only 78% of online orders are in CA Dollar; USD accounts for 23% of orders. In Switzerland, only 74% of orders are in Swiss Franc; 10.5% of orders are in USD – and 15.3% are in Euro.
  26. 26. What does all this mean? If a non-US customer can access a US store where the currency conversion rate is 10%, 15% or even 20% in their favor, where do you think they’re going to purchase? Admit it. You’d do the same thing.
  27. 27. Here’s the takeaway. You can avoid losing revenue by locking down prices in the native currency of each country you’re selling in. Make sure that your pricing is optimized for every region so that your customers don’t have reason to hunt for better prices in foreign stores.
  28. 28. Ecommerce Benchmark: Payment Methods
  29. 29. Global Payment Trends Credit cards and PayPal dominate – they’re used for a combined 90% of all online orders worldwide. PayPal has been consistently on the rise from 2006 (when usage was at a mere 9.3%) and now accounts for over 20% of global e-transactions.
  30. 30. PayPal moved $180 billion in 26 currencies across 193 countries in 2013, and its revenue lifted 20% — to $6.6 billion worldwide. Source
  31. 31. Global Payment Trends PayPal and credit cards are seeing success at the expense of wire transfers and direct debit. Wire transfers and direct debit have been declining since 2007. That’s the year wire transfers and direct debit usage peaked – wire transfers at 19%, and direct debit at 14%.
  32. 32. US Payment Trends PayPal usage is steadily rising. Though credit cards are still the most popular payment method by a wide margin, that popularity is slowly waning.
  33. 33. UK Payment Trends Customers in the UK dig PayPal even more than Americans do – it’s used for nearly 40% of online transactions. In 2014, credit cards accounted for about 65% of all online transactions in the UK, down from almost 100% in 2005.
  34. 34. In the US and UK, two main payment methods (PayPal and credit cards) dominate ecommerce. Germany is different.
  35. 35. German Payment Trends PayPal is the top payment method, followed (in order) by credit cards, Direct Debit and wire transfers. All four methods have significant market share.
  36. 36. Here’s the takeaway. Your business should be supporting credit cards, PayPal, direct debit and wire transfers at the bare minimum. But you already knew that.
  37. 37. Let’s look at four payment methods that you should strongly consider adding to your repertoire: Konbini Swedish Real-Time Banking Boleto Bancario German Direct Debit
  38. 38. Payment Method: Konbini
  39. 39. When the customer chooses Konbini as their payment method, online checkout generates a payment slip with full transaction details. The customer takes this payment slip to a konbini (a Japanese convenience store), where they pay the balance. Once the payment is made in full, the retailer delivers the product. What is Konbini?
  40. 40. In Japan, credit cards dominate at 59.5% of online transactions. At its peak in 2009, PayPal was used for about 10% of purchases. Konbini has been taking market share from PayPal. In 2011, Konbini surpassed PayPal in usage – it’s still on the rise. Across all industries in Japanese ecommerce, Konbini enjoys a healthy market share of 16.6%. Source How popular is it?
  41. 41. You should accept Konbini as a payment method in Japan. Here’s why.
  42. 42. Companies who did not to offer Konbini saw an average conversion rate in Japan of 14.1%. The average Japanese conversion rate of companies who did offer Konbini was 19.7%. That’s nearly a 40% lift in conversion rate for companies who made Konbini available. Adoption Test: 2012-2014
  43. 43. Data suggests that just having Konbini in the cart appeals to the Japanese customer, even if they don’t ultimately choose to pay with Konbini. Adoption Test: 2012-2014
  44. 44. Payment Method: Boleto Bancario
  45. 45. Boleto Bancario is a consumer push payment method that relies on the customer visiting a physical bank office to pay for their online order. Once the customer pays the transaction balance at the bank office, the retailer delivers the product. What is Boleto Bancario?
  46. 46. Brazil’s market is similar to Japan’s in that credit cards still dominate, but Boleto Bancario is taking market share from PayPal. Overall, Boleto Bancario is used for about 20% of all online purchases in Brazil. How popular is it?
  47. 47. You should accept Boleto Bancario as a payment method in Brazil. Here’s why.
  48. 48. Companies who did not to offer Boleto Bancario saw an average 3.5% conversion rate in Brazil. Those who did make Boleto Bancario available had an average conversion rate of 4.8%. While it may not seem like a huge difference, it’s a 37% lift in conversion rate – if you’re getting 100,000 orders a year, that’s an extra 32,000 orders! Adoption Test: 2012-2014
  49. 49. The data suggests that just having Boleto Bancario in the cart appeals to the customer, even if they don’t ultimately choose to pay with Boleto Bancario. Adoption Test: 2012-2014
  50. 50. Payment Method: German Direct Debit
  51. 51. German Direct Debit — or Elektronisches Lastschriftverfahren (ELV) — allows a customer to authorize a retailer to debit their account for a fixed amount, for any future invoices, or for recurring payments. What is German Direct Debit?
  52. 52. We’re seeing German Direct Debit used for about 20% of online transactions in Germany. This percentage has been inching closer to German online credit card usage (which, in 2014, was about 25%) for a few years now. How popular is it?
  53. 53. You should accept Direct Debit as a payment method in Germany. Here’s why.
  54. 54. Companies who did not to offer German Direct Debit had an average conversion rate in Germany of 10.6%. Compare that to an average conversion rate of 14.9% for companies who did offer German Direct Debit. This is a 40.5% lift in conversion rate for companies who make German Direct Debit available. Adoption Test: 2012-2014
  55. 55. Not all German customers are comfortable with submitting their credit card information online. Offering German Direct Debit as a payment method is proven to convert more online shoppers in this market. Data suggests that just having German Direct Debit in the cart appeals to customers, even if they don’t ultimately choose it as their payment method. Adoption Test: 2012-2014
  56. 56. Payment Method: Swedish Real-Time Banking
  57. 57. When making an online purchase, the customer authorizes payment in their own online banking account. Immediately upon authorization, the retailer receives an automated payment confirmation from the customer’s bank. Customers have access to major Swedish banks, including Nordea, Handelsbanken and SEB. What is Swedish Real-Time Banking?
  58. 58. Swish, a popular app owned by six Swedish banks that allows customers to make real-time payments using their mobile phones, hit 1 million users in August 2014. Source How popular is it?
  59. 59. You should accept Real-Time Banking as a payment method in Sweden. Here’s why.
  60. 60. We’re running a test in the Swedish ecommerce market on customers with Euro as their selected currency. The goal is to see if offering Swedish Real-Time Banking as a payment method enables an optimized reach of the Swedish market. Adoption Test: Ongoing
  61. 61. Looking good so far! Data has yielded an average conversion rate increase of 6%, with some companies seeing conversion rate increases as high as 12%. And we expect to see further conversion increases as we continue testing. Adoption Test: Ongoing
  62. 62. Conclusions
  63. 63. Data your business. It casts light on the dark corners of unfamiliar markets. It shines on new opportunities for growth and development. It brightens your path as you pave it.
  64. 64. There are three simple processes for collecting data that will boost your business to the next level.
  65. 65. 1 Testing
  66. 66. → Testing is not just the best way to find out what stimulates conversions — it’s the only way. → Use GeoIP technology to collect data on your customer’s browser language, location, etc. and apply it to your product page and shopping cart. → Controlled, thoughtful testing will reveal what resonates with customers in different markets.
  67. 67. 2 Tweaking
  68. 68. → Do your research. Build on a foundation of proven best practices. → Tweak your merchandising. → Tweak your messaging. → Work at customizing your entire ecommerce experience, from cart to checkout to post- purchase support, so that it feels familiar, safe and secure for shoppers in every market.
  69. 69. 3 Taking Notes
  70. 70. → Track behavioral and transactional patterns. → Identify trends that develop over time. → Use a robust analytics to collect data about your customers and how they engage with your product pages and shopping cart. → Where are shoppers dropping off during your purchase process? Why?
  71. 71. Though it’s data that drives your development, there’s always an element of intuition involved.
  72. 72. Trust the facts – and trust your gut. After all, you’re a customer, too.
  73. 73. Let’s get to work. To learn how cleverbridge subscription billing solutions can help you build long-term customer relationships and grow recurring revenue streams, contact us today.

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