According to the Office for National Statistics, sales volumes fell by 2.8% in 2023; the lowest they have been since 2018. Whilst investors prepare for a subdued 2024 in the UK due to unavoidable factors such as inflation and taxation, consumer behaviours have changed.
However, there are emerging international markets across the globe in which retailers looking for growth should take particular interest. According to Jonathan Sheard, Vice President of Sales at ESW, retailers must not only reassess their strategies but strongly consider looking further afield in different continents such as the Middle East and Asia for increased opportunities.
International demand for British brands in 2023 was driven by cross-border shoppers in the UAE, where more than a third of shoppers (36%) purchased cross-border from the UK; followed by Australia (28%), South Africa (26%), India (26%) and Spain (23%).
Lumina Capital Advisers believe “the Middle East represents a rare global bright spot for UK companies.” Research gathered by ESW’s latest report Growing International Ecommerce Markets, has highlighted the emerging global markets for Ecommerce such as Mexico, South Korea, and Japan.
Why have these countries become popular hotspots for retailers?
Mexico
In Mexico, brand reputation holds significant value among shoppers, yet when it comes to online shopping, price and discounts the utmost importance. The major factors motivating cross-border shopping are price competitiveness and product availability. 80% of online shoppers engaged in cross-border transactions in 2022. Notably, platforms like Facebook and WhatsApp have an extensive reach, connecting with 93% of the population. Looking ahead, a substantial 68% of individuals intend to maintain or increase their online spending in 2024.
India
India is considered one of the global leaders in Ecommerce, with 125 million online shoppers. One of the reasons India has been highlighted as a hotspot is due to the market’s projected surge of 18.29% by 2026. Over a quarter of these consumers engage in online shopping regularly, averaging more than 72 online purchases annually, second only to China in the Asia-Pacific region.
Japan
Japan takes the position as the fourth-largest Ecommerce market in the world. Consumers in Japan have a strong preference for online prices that are lower than those available in-store, coupled with the expectation of shorter delivery times than the global average. In addition, the Japanese Ecommerce sector has seen a doubling in size over the past nine years. Looking ahead, 61% of consumers plan to maintain their online spending habits throughout 2024.
South Korea
Online retail is the largest sales channel in South Korea. One of the reasons consumers are likely to shop across the border is mainly because they feel they can get better prices from not just neighbouring countries, but Western countries. Online transactions account for 60% of total purchases, with only 40% in-store purchases. Cross-border Ecommerce witnessed substantial growth in 2022, reaching $4.7 billion. 66% of shoppers plan to either maintain or increase their online expenditure throughout 2024.
Maintaining a satisfying experience for customers
Today, brands benefit from mass amounts of external data sources that highlight not only where the existing opportunities are, but also the trends that lead to future opportunities. Brands can also take advantage of the use of partners who can manage the entirety of the order process from compliance, data security, fraud protection, taxes, and tariffs to checkout, delivery, returns, customer service, and demand generation. This allows brands to optimise their operations and focus on core competencies while ensuring the experience is seamless and satisfying for their customers.