These Are the Hottest Global Ecommerce Markets

Ecommerce, global ecommerce, cross-border selling, cross-border ecommerce, Gilt, Gilt GroupeFavorable government policies, high duty thresholds and the popularity of U.S. brands all contribute to making some global ecommerce markets hotter than others, experts said.

Canada is the most popular country outside the U.S. for cross-border sellers to sell in – nearly 60% (58.5%) do, according to MCM Outlook 2015. More than 30% (31.7%) said they sell into Australia, and 29.3% sell to customers in Mexico.

Jamison Shelton, owner and principal of Global Nuance Consulting, said he has seen “under-representation” of U.S.-based merchants pursuing opportunities in Canada, the UK and Australia/New Zealand, the primary offshore English-speaking markets.

“If you look at the major U.S. online sellers, you don’t see localized domains (in those countries),” Shelton said. “They may ship from their .com operation, but it’s not being specialized, there isn’t dedicated marketing or teams building those individual markets. There’s still a lot of room for growth and maturity for U.S. retailers to expand into key English markets.”

Australia in particular has gone out of its way to encourage global ecommerce, Shelton said, by setting its de minimis value – the threshold below which there are no import duties – at a very high rate of $1,000. By comparison, the rate is $20 in Canada and $200 in the U.S.

Germany, France and the Nordic countries “are also big-opportunity markets people tend to forget about,” Shelton said.

Marshall Porter, senior vice president and general manager of Gilt, said from his perspective that China and South Korea were among the hottest markets for global ecommerce. Latin America is getting hot, he said, while the Middle East is growing but off a much smaller base.

“The activity in Korea has been driven in part by the government, which has lowered duties and tariffs on things like personal products, which is an implicit endorsement by officials of cross-border trade,” Porter said. “Also, savvy shoppers there are using freight-forwarding services, as U.S. merchants become more aware of them. So it’s easier for Korean consumers to justify shopping cross border.”

Similarly, China opening four free-trade zones – Shanghai in 2013, and Guangdong, Tianjin and Fujian this year – has been a boon for ecommerce there, Porter said, making it easier for foreign merchants to do business. “In effect, the Chinese government is saying consumers there are already going to businesses in New York, Hong Kong or Tokyo, and we’re not getting any revenue, so they’re encouraging them to do more cross-border buying from businesses (in the FTZ). It’s been a big shift and will continue to be.”

Those two markets are “growth prone” if merchants take the right steps to take advantage of them, Porter said.

Out of the so-called BRIC countries – Brazil, Russia, India and China – Brazil and China are the hottest right now, according to David Wachter, division president of urban apparel brand Jimmy Jazz. “Unfortunately, high fraud in Russia has detoured us from focusing in on that market,” Wachter said.

Carl Miller, founder and managing director of the Global Retail Insights Network (GRIN), agreed saying BRIC could be shortened these days to “BC,” or even just “C.” “Political and economic conditions in Russia, and the difficulties of delivering packages in India, make them more difficult to deal with,” he said.

As for Brazil, Miller said it’s a highly sought-after prize but very difficult to crack in terms of infrastructure, prohibitive regulations and exorbitant duties and fees, all of which discourage imports. “For U.S. retailers, delivery duty paid (DDP) options aren’t there, so they send products to Brazil as unpaid,” he said. “If a customer decides not to pay, the retailer is on the hook for the costs, according to the Brazilian government, and the package isn’t released to the customer until they do.”

In addition to Korea, the Southeast Asia nexus of Indonesia, Malaysia, Singapore and Hong Kong represent a great opportunity for merchants “who can get lost in China, because it’s too big to navigate,” Miller said. “These markets have become a bright spot because they’re more manageable and represent a sizable population with Internet access flowing and a desire for Western brands.”

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