Why Australia’s decision-makers should consider cross border business
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Australians have long had a love affair with cross-border trading, including e-commerce, with this market expected to reach $192 billion in 2030, up from $43 billion this year.[1] This growth will in part be driven by new cross-border trade agreements such as the recently-signed The Regional Comprehensive Economic Partnership (RCEP). It may seem counterintuitive in the time of COVID-19 lockdowns, but global cross-border business rose by 18 per cent in 2020.[2] COVID has only exacerbated the shift to online shopping and that’s likely to continue.
This growth has been supported by pandemic-induced themes such as businesses pivoting their efforts into new and changed markets to expand their customer base, and customers engaging with online shopping more consistently. This trend is set to ramp up, as the global economy re-opens and as the preference for online commerce cemented this year accelerates.
Humans have engaged in cross-border trade for centuries. But it’s come into its own through the digital revolution and the proliferation of global online platforms, social media and e-commerce.
As a result, businesses are now much more easily able to deliver products and services to new audiences. At the same time in big markets across the globe, the motivating factors for consumers in buying products from foreign countries are now primarily driven by whether items are available locally and their price compared to the local market.[3] Cross border business is able to bridge this gap and drive transactions.
There are numerous Australian businesses both large and small that have successfully expanded internationally. The enterprises that are most successful focus on finding the right customers, and tailor their advertising language for different locations and customer preferences.
Jubly-Umph, an Australian art, jewellery and accessories brand, is one local business that has successfully scaled up through cross-border trading. They started with understanding their existing customer base and their brand’s demographic using audience insights tools. They then began targeting customers segments in other markets that resembled their existing customers.
“I used Facebook’s lookalike audience function to create a list of people who were like my existing customers and then ran ads specific to the region in which they were located,” says Tasha Miller, owner and content creator, Jubly-Umph.
The extension of this strategy looked beyond demographic and location targeting to identify audiences that resonate with their brand message. This has helped them find customers in new countries such as Mexico, Ireland and the Netherlands.
“This allowed me to reach customers around the world who are united by my brand message to ‘stay weird’. As a result, I’ve received orders from Mexico, the Netherlands and Ireland, countries to which I previously would not have considered marketing,” she adds.
When it comes to tailoring advertising language and information based on customers’ location or preferences, Rose-Hip Vital, an Australian family-owned business that offers pure and natural health supplements for people, dogs and horses, used the experience it had gained expanding into Hong Kong and Singapore to tackle the US.
This is a market where a diverse population of customers means they could localise marketing and especially the language of their ads, in order to become more customer-oriented.
“Facebook makes advertising to audiences in other countries very easy. Its language optimisation tool means we could automatically translate ads into the default language of the potential customer’s phone. It also supports easy testing of ad creative, messaging and offers, which is essential, no matter which market you are in,” says Justin Diamond, director, Rose-Hip Vital.
For Sabo Skirt, a clothing, shoes, swimwear, sleepwear and formal wear collection founded by two Brisbane-based besties Thessy Kouzoukas and Yiota Karalouka, delighting customers is key in cross-border markets. They have targeted international clients who want a style not available overseas through their online store.
“We optimised the end-to-end experience from when a customer first hears of the Sabo brand, to browsing the web site, buying, receiving the orders and customer service. Every time a customer touches our brand is important and we work hard to ensure they understand how valued they are,” George Kouzoukas, marketing manager at Sabo Skirt explained.
The business has also built strong relationships with DHL and Australia Post, with emphasis on keeping open communication channels and regularly updating customers to ensure they are satisfied with the shipping process.
Miller’s advice when it comes to starting out on your cross-border business journey is to plan ahead and take on initiatives to grow through the pandemic and beyond.
“Creating a plan for different eventualities, or disaster prepping my business, as I like to call it, for lockdowns, staff working from home and shipping disruptions has meant we were ready to go when those things happened. This has led to my biggest-ever year of sales.”
Making the most of Facebook’s suite of solutions and resources is Diamond’s advice for businesses exploring cross-border opportunities.
“Without Facebook, we would not have experienced the growth we have achieved over the last three years. It’s a game-changer when it comes to acquiring new customers in a highly controlled, affordable and scalable manner.”
Facebook has a whole suite of solutions & insights to help your business access new customers beyond your locality. Head on over to Facebook’s Cross Business Hub to learn more about how the different solutions can help kick-start your cross-border journey today.
[1] https://www.afr.com/policy/economy/digital-trade-worth-192b-by-2030-push-on-for-new-global-rules-20181009-h16eky
[2] https://www.forbes.com/sites/johnkoetsier/2020/10/21/44-of-global-ecommerce-is-owned-by-4-chinese-companies/?sh=426d13e51645
[3] Facebook IQ, Re-emerge study by Ipsos, Facebook commissions online study of people aged 18+, July-August 2020
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