Cross Border E-Commerce; What to Expect Post Covid-19

Cross Border E-Commerce; What to Expect Post Covid-19

“Successful business people do not wait for opportunities, they create them.”

The market dynamics in the corporate world have never been constant. Moreover, with the novel coronavirus encapsulating the world, retailers, and sellers, entrepreneurs- everyone has been struggling to keep their financial numbers secure and stable. However, things have been a little challenging with the chaos and lockdown instigated by the Covid19 pandemic.


Even though businesses around the world were already curating strategies to make their brands go international and online, the Covid19 pandemic accelerated the paradigm. While the pandemic crushed personal, social, and health activities of people’s personal, social, and health levels, the Omni-channel retailers and brands thrived with cross-border e-commerce. Studies revealed, that during the peak of the pandemic (first half of 2020), Amazon US saw a drastic rise of 26% in sales as compared to the year before the pandemic.


Certain trends have emerged and spiked throughout 2020 in the cross-border marketplace that is pragmatically thought to retain a sustained plateau for at least the next few decades. Online websites like Amazon, Alibaba, Etsy, Shopify alongside the money transactions sites such as PayPal and UPS have witnessed more than double-digit growth with cross-border shopping and shipment.


2020, or the year of the Covid19 pandemic has laid down a plethora of opportunities for B2B and B2C companies to lucrative on trade across the international borders. Cross-border e-commerce in a huge international marketplace has become a wider platform for businesses with life-changing emerging trends post Covid19.

Covid19 and the Emerging Trends in Cross Border E-Commerce


Instigated from China in 2019 and spread around the world like a wildfire in the forest. Covid19 has turned emerging e-Commerce markets such as China, the US, UK, Singapore, and Asia-Pacific into leading giants making revenue worth billions of dollars.


With the coronavirus on the loose, people are cautious about avoiding human contact and prefer online shopping. Cross-border e-Commerce allows retailers and sellers to avail international products and services without the hassle of going out. Moreover, now once the millennials are hooked to technology and their screens, they might find it hard to leave their comfort zones and go back shopping in stores.


E-Commerce before the Covid19 Pandemic:


“After every stormy rain, there is always a chance to reap benefits, for those who look!”


Even the years before the pandemic, the millennials increased the DTC- direct-to-consumer e-commerce purchases. Studies revealed that 52% of the population in the age bracket of 25-35 years old was already buying things online and the numbers increased to almost 60% as soon as the pandemic hit and shuttered down the physical stores. Statistics from the pre-Covid world to midway in the Covid19 era revealed that 61% of consumers from China and India, 50% from Russia, and almost 60% population of Mexico were directly purchasing their goods online from international retailers. Alibaba in China and Amazon in the UK and USA have sell electronics, clothing, and beauty products double the rate in the first half of the pandemic than ever before.


The consequential rise in cross-border trade before Covid19 and during the pandemic has made its way successfully into 2021. It has been predicted that the e-Commerce market in the USA alone is set to surpass a net ROI of 6 trillion dollars by 2024.


Even though the e-commerce market is flourishing internationally, adapting to the key emerging trends, post-Covid-19 is the major survival determinant for all online retailers and brands.


·         Globalization of Social Commerce:


Social media is redefining the digital world, with over 80% of the world’s population existing in at least one of the social platforms. The millennials with their crazy shopping free and easy-to-get-things hack have made online shopping a lifestyle standard. Payments media apps like WeChat in China and PayPal in the USA are also incurring an easy shift to the digital world. No hassle payments, on-time deliveries, gazillion product options, and categories are all just a click away.

Social media platforms allow a thorough search for the product you are looking for and list them down according to the consumer’s preference. Consumers respond well to the products if reviews are available, however more than 90% of them will be hesitant to buy the product if there are no reviews on the website.

The amalgamation of social media platforms, live streaming, exclusive content creation, alongside blogging and influencer marketing have become the experimental variables in the international marketplace. Smart business people are targeting the young millennial to their online existence using the models shadowing entertainment, marketing, and sustainability.


·         A rise in Cross Border E-Commerce Competitors:


It is a common understanding that whenever a lucrative online trend is set, people would acknowledge it and try to harness the benefits. This is why the competition is likely to increase.  As more DTC direct-to-consumer brands and retailers surpass their local market potential, they are more likely to expand into the global market to reap profits.


If we look at the international marketplace today, the major hot selling markets are China and the USA. However, with the emerging awareness and social tools, it is predicted that small markets such as East Asia, Middle East, Australia, and New Zealand, etc will soon have the ball in their court if the rapidly adapt to the e-commerce trends.


·         Sustainable E-Commerce Strategies:




Customer sustainable strategies indicate identifying and implement the basic elements that meet the consumer demands and align with the business goals. Keeping intact the three customer sustainable aspects; the society, the environment, and the economy online retailers have to come up with pocket and eco-friendly e-commerce strategies.

From bio-degradable packaging to reducing the carbon footprints, brands are now targeting recyclable materials to implement customer sustainability. Using material to lower the packaging and shipments costs, online retailers are acknowledging the importance of keeping the consumers happy!


·         Long-Term Customer Relation:


The best business strategy is the one that ensures customer retention even after the purchase. To stay at the top of cross-border e-commerce, and remain unbeatable in the international marketplace, you need to ensure the best customer experience at every step of the shopping. The time they enter your website until the make the purchase, the brand needs to ensure that there are no abandon carts.

Post-purchase cold emails, newsletters, customer feedbacks, responsive chatbots make the customers feel valued by the brand that makes them return to the site for more purchase. Hence, it allows maintaining a healthy loop of profitable sales.

Apart from the major trends, business owners need to ensure frictionless cross-border payments, offer promo codes, ensure on-time and safe deliveries, and a seamless customer experience by providing 24/7 customer support.

Impact of Covid19 on E-Commerce on the International Market


From the start of the pandemic until the mid of May 2020, the internet saw a 7% in the revenues generated by digital buyers. Cross-border e-Commerce is growing by double the rate as compared to domestic e-Commerce. The Omni-channel brands and retailers from Asia, the US, Europe, and China that trade across the borders had a 0% negative impact of Covid19 on their sales. Initially, the international marketplace especially with their expertise in supply chain and certain discretionary items fluctuated, with the numbers going downhill.


However, as soon as the world adapted to the “lockdown” and started utilizing the online opportunities to get the goods delivered at their doorstep the ROI graph saw a positively dramatic increase in sales. Albeit the fact that fashion and beauty are still the most consumer-attracting cross border online brands, yet luxury like electronics have seen the highest growth in the international marketplace during 2020.  


Even though cross-border e-Commerce has been thriving since the pandemic, there have been hurdles such as difficult accessibility to certain regions leading to delays in the delivery of the packages. However, as it has been rightly said that need is the mother of invention, certain brands took a huge leap and have converted commercial flights or personal fleets into shipment freights.


1.       China and the USA:

Years before the Covid19 chaos, China’s State Council developed strong cross-border e-commerce roots in more than 105 international regions. Since the Covid-19 outbreak to 2020, China’s International trade uptick the revenues by 31%, making a whopping 260.6 billion US dollars (equivalent to 1.7 trillion Chinese Yuan). According to a study published by Ren China, cross-border e-Commerce has significantly grown by a factor of 10 since 2015.

Whereas in the US, cross-border online trade increased by sales 7% year over year in the past decade before the Covid19 era. The sales spiked to 42% by May 2020, increasing the revenue by 7% to 10.2% in the first half of 2020.


2.      Australia and New Zealand (ANZ):


The marketplace in Australia and New Zealand has seen both loss and profit during 2020, yet cross-border e-Commerce has managed to survive and thrive. Even though e-commerce in the ANZ region lags behind the leading market giants such as China, the UK, and the US the two countries are expected to generate an ROI of 33.4 billion dollars in 2021 with online sales across the borders. Cross-border e-Commerce is growing exponentially in the ANZ regions with almost 10% in Australia and more than 30%in New Zealand.


3.      Asia-Pacific:


The cross-border trade has grown exponentially in East and South Asia, with an expected ratio of 80% digital consumers by the end of 2021. The largest market in Asia has become fashion and beauty with a predicted annual growth rate CAGR of almost 10% from 2021 to 2025.


4.      Gulf Countries:


The Gulf practiced strict lockdown and precautionary measures as soon as the pandemic hit with almost no effect on e-commerce. However, with the world now recovering from the repercussions of covid-19 and the go-Gulf projects (such as Dubai all set to launch its Expo 2020), it is estimated that the ROI may reach 48.6 billion dollars by the end of 2022.


5.      Italy, Austria and Denmark:


Recovering from the Covid-19 pre-crisis figures, the cross-border marketplace in Italy experienced a 40% increase in e-commerce by March 2020. As things are getting back to normal, Austria, Denmark, Singapore, Vietnam, and other underrated international marketplaces are also witnessing a massive increase in online sales. 


How to Harness the E-Commerce Opportunities Post Covid19


To take advantage of the lucrative opportunities laid down by the novel coronavirus the countries need to adapt to newer policies and tackle the “border” crisis smartly. From smaller firms to large multinational companies, even the ones who did not have any digital presence before 2020, have seen an increase in sales using the various online platforms.


Here are some of the ways through which cross border e-Commerce can become the biggest finance generating aspect for the world’s economy:


  • Overcome the language, currency, tax, and legal border barriers
  • Invest in the freight business and take advantage of drop shipping
  • Use third-party logistics to ease the delivery process
  • Invest in Artificial Intelligent and Machine Learning
  • Keep an eye on the hot international marketplaces, see where the majority of the online buyers exist, and launch your brand accordingly
  • Survey the market, test your products and work on the customer feedback


The Key Takeaway


The accelerated shift to international e-Commerce has been a blow to the brick and mortar stores that may never see the high rise in sales volumes again. With the globalization of e-commerce brands, the key to survival is a robust, adaptable, and diversified cross-border e-commerce strategy.


With 2021 in the rearview mirror, it is high time for the retailers to look forward to 2022 and see what the future holds for e-Commerce. Every cross-border e-commerce retailer and brand needs to up their game in the context of enhanced customer experience, satisfaction, and loyalty. Even though the trends are prone to fluctuations and the market dynamics are never changing, it is better to prepare the battleground and ensure customer sustainability. This will not only help to survive in the domestic e-commerce but help the brands claw onto the international marketplaces with profitable ROIs.


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