As we greet a new decade, the world has never been more global. E-commerce has made it possible for any business to be an international business. Many international e-commerce brands have looked to the lucrative possibilities of selling to American customers.
Successfully taking a business into the American market can lead to exciting opportunities for your business, but you’ll want to make sure to maximize those opportunities. So, how can you best reach the American consumer?
1. Optimize your taxes.
Tax optimization should be a priority when moving into the American market.
Sadly, too many companies overlook this step. International companies desiring to enter the United States market often create a physical presence in the country, which subjects them to American corporate tax rates of around 30% to 40%. If your company establishes an overseas operation in a tax haven such as the British Virgin Islands or Hong Kong, it is possible to circumvent these tax liabilities.
Some people fear shipping to American customers will take too long if they do not create a physical presence in the United States. A simple solution to this problem is to use warehouses in Canada and Mexico for shipping and holding inventory. This allows you to ship to American customers within three days. I can’t emphasize this enough – tax optimization is a critical step in your expansion into the American market.
2. Make customer service a priority.
American consumers are used to a high level of customer service from the businesses they frequent. It’s important to understand what customer expectations will be as you expand into this new market.
According to a 2019 Gladly Survey, 84% of customers will switch to a different company after three negative experiences with customer service, and 17% of these customers leave after just one bad experience. The way you treat your customers will be a major determining factor in the outcome of your brand’s expansion into the American market.
The best way to ensure customers feel taken care of is to respond to questions quickly. According to Gladly’s findings, consumers expect a response to email inquiries in about three to four hours. Live chat is also gaining traction as an efficient way to communicate with customers. Consumers expect a response to a live chat inquiry in under a minute. There’s a reason it’s called “live chat.” The expectation is that it is constantly being monitored.
A failure to meet these quick response rates can, unfortunately, leave a bad memory of your brand in customers’ memories. Avoid this issue by making customer experience a top priority, a quintessential aspect of your e-commerce operations.
Although American expectations for customer service are high, these expectations are frequently not met. Consumers are always looking for a new brand that will take care of them better than all the others. This gives you an opportunity to break into the market by showing consumers you have a higher quality of service than the competition.
3. Cut out the middleman.
It is a common practice for international e-commerce brands to partner with large distributors when expanding to the American market. Companies such as Amazon and Walmart have profited greatly from this practice.
Large distributors will sell your product but keep a portion of the revenue. This may be convenient, but it cuts down your profit margins. More and more successful brands are realizing they can increase profit margins by cutting out the middleman and selling directly to customers.
It can be difficult to compete with e-commerce giants like Amazon and Walmart when trying to break into the market, but with the greater profit margins you’ll receive from selling directly to customers, you can focus on improving your marketing efforts and strengthening your branding strategy. This way, your direct-to-consumer strategy is sure to pay off quickly.
4. Design your brand with care.
A consumer’s first exposure to a brand is a critical moment. When expanding to a new market, think carefully about what you want consumers’ first impressions of your brand to be. You’ll want to be sure people’s first impression of your brand is a memorable one. It’s important to not only be memorable, though. You also want to make sure that your brand is remembered in a positive light.
It’s likely your business has already established a persona for your brand in the markets you currently sell in. Determine whether or not to use the same branding in this new market. Do some research into the brand preferences of your target demographic in the American market.
Look at things like color palettes, typography and logos. Even if choosing a color seems trivial, it can be a critical part of a consumer’s decision to buy from your brand. According to research from the Emerald Group, around two-thirds of a person’s decision about a brand during the first exposure is decided on color alone.
No part of your branding process is too trivial to pay attention to. Well-designed brands sell products. Be intentional with your branding strategy.
5. Partner with influencers.
Industry influencers are people who already have traction in your target market. They might have a large following on Instagram, YouTube or a popular podcast. Partnering with one of these influencers will be a huge advantage during your expansion. These people have already done the upfront work of building trust with an audience and establishing themselves as a reliable source. With an influencer’s help, you can reach new audiences more effectively.
When looking for an influencer to partner with, you should find someone who really believes in your product. It’s important that the person representing your brand believes in what you’re selling, because audiences have an excellent eye for spotting inauthenticity.
In fact, the most successful influencers have built trust with audiences by proving their authenticity. Hiring someone who (with the right size paycheck) is willing to represent any company will not help you acquire customers as effectively as someone who genuinely enjoys your product.
It’s important to keep your own brand’s personality in mind when searching for an influencer to represent your brand. If your brand is sophisticated, find someone who shares those qualities. If you have a casual and humorous brand, the people representing you should be the same. With the numerous influencers out there, keeping this principle in mind will help you narrow down the list of people to reach out to.
6. Understand American marketing channels.
With over 2 billion active users worldwide, Facebook globally dominates the majority of social media users’ time. Because of this, it is likely your brand has utilized this platform regardless of which national e-commerce markets you are currently in.
The U.S. market is no different than other countries in that Facebook is a highly important marketing channel to utilize. In fact, 80.4% of U.S. social referral to e-commerce came from Facebook. It’s imperative to be using Facebook as a marketing channel.
The difference between the U.S. and many other countries is that the U.S. uses other social media platforms besides Facebook at a much higher rate than most other nations. Americans are typically on Instagram and Snapchat in larger numbers than residents of other countries. Use these platforms to reach broader audiences.