Retailers offer views on international expansion

Retailers offered their views on how to enter new international markets through eCommerce at a special event in London on 18 September, and Essential Retail was there to hear what they had to say.

The eCommerce Futures Conference, run by web hosting firm PEER 1 and partners Intershop, Javelin Group, WorldPay and Dell, brought together speakers from the likes of fashion retailers Coast and Hobbs and pure-plays such as sex toy specialist Lovehoney to discuss their latest endeavours in international expansion.

Various presentations on the day gave an insight into the respective companies' successful initiatives and major challenges when expanding abroad, so we've rounded up some of the key points from the show.

Matt Curry, head of eCommerce at Lovehoney, said that for eCommerce operations to work successfully in new territories it is important to "do the stuff a start-up would do". Established retailers, he said, should not be afraid of looking at the basics of retailing when entering foreign markets.

Lovehoney has had a fair degree of success in Australia, for example, though various business initiatives such as localising its public relations activity. As a retailer that sells an evocative product range, it has been able to use its data to generate cheeky PR such as announcing which regions buy the most sex toys – something that can certainly stimulate local interest in a brand.

Curry's main point of advice to UK retailers eyeing foreign climes was to be wary of the US. "It's a nice looking pie," he said, "but the British have shown a lack of ability to conquer it. There are lots of other opportunities."

The eCommerce Futures Conference also provided a platform for a lively panel debate involving Coast Fashions' head of eCommerce Bianca Mercer, technology and business change director at Hobbs Sharon Lowrie and interim global eCommerce director at Dr Martens Chris Jones.

Coast has in the past received positive feedback for its eCommerce network in the UK and was one of the first retailers to offer 90-minute delivery a few years ago, and today it sells products online in more than 20 countries.

Mercer said that one of the key criterion for Coast when expanding internationally is to have a native speaker for each new territory. In the fashion industry it is important to maintain a particular brand image and this can often be lost in translation, she said, adding that she is "passionate about checking translations".

Hobbs is new to international eCommerce having only expanded to Germany at the start of September and it is currently in the process of moving into the US and Australia.

Lowrie told Essential Retail that the company will monitor sales week-by-week, but is pleased with the strategy so far. During her presentation, she indicated that the biggest obstacle to international retail expansion can be managing expectations of senior management and it is important to get the business to accept that it won't achieve perfection on day one.

Dr Martens' Jones had some key tips for retailers as they look to start their global journeys.

"Never venture into a country you haven't visited personally with a local," he warned, before adding that one of the biggest hurdles to success internationally is when politics gets in the way of practicality and new markets are chosen for internal rather than strategic reasons.

Meanwhile, family-owned children's crafts retailer Baker Ross has recently been trialling its offering through marketplace partnerships in Germany, the US and France. The business's finance director Paul Giuffredi, who spoke to delegates about his business's latest plans, said marketplaces are a cost-effective method of dipping a toe into new countries.

However, his main message for successful international expansion is: "Don't just sell; you have to fulfil the product at a price and form the customer is happy with. If you can't fulfil sales in this manner, you'll get terrible reviews."

There was plenty of advice to consider from retailers that are already broadening their eCommerce horizons in new territories.

As Matt Jeffers, associate director for strategy at industry consultancy Javelin Group, said in his presentation – it's important to look at a whole host of factors when targeting a new market. These include population characteristics, broadband penetration and payment preferences, as well as the kind of brand presence that particular country already boasts.

"The only way you'll get sales first and profits later is in the initial planning," he commented.

It was certainly clear from the presentations and panel debates throughout the day, that retailers will not succeed internationally if they do not pay adequate attention to detail.

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