International customers get short shrift

When ASOS released its annual results in June, the stats that leapt out at me were those relating to its international performance. Revenues from overseas reached an impressive £53 million for the year, up 103 percent from 2009. Asos chief executive Nick Robertson also talked about his plans for expansion: New websites for the US and Europe to launch this year, accompanied by PR and marketing campaigns. Clearly, for Asos, international growth is seen as a major opportunity.
And yet in our 2010 Delivery in the UK Report, which was published in January this year, we noted that 42 percent of UK retailers don’t offer any overseas delivery at all--not even to the Republic of Ireland. With retailers looking to maximise revenues from their online channel, why is the international market being ignored?

We decided to carry out another piece of research to see how easy it is for shoppers living overseas to buy online. For the research, we created a panel of international shoppers in countries including China, Hong Kong, the US and Canada, Australia and New Zealand, Brazil, South Africa, and several countries in Europe.

We then tested 76 UK retailers that offered overseas delivery. The aim was to find out if international delivery is a minefield--is there a good reason that retailers shy away from it altogether, or don’t promote it as much as they should.

Here are just a few of our findings: 

• Only two orders incurred customs charges. All of our non-EU shoppers were worried about customs charges, as most of the websites they were testing had scary-sounding warnings about them. And yet only two of our orders had any charges levied (and one of those is being contested). Admittedly, this is probably related to the fact that our average order value was £29.33 and none of the orders contained goods worth more than £99. Nevertheless, making the customs situation clearer would put fewer customers off. Maybe what is needed is a resource that retailers can point customers to, showing what the customs charges should be for their country, rather than saying “you may be charged a fee, please contact your customs and excise department”.

• The average delivery charge was £12.27, compared to £3.88 for the UK. When we asked our shoppers what prevents them from buying from UK websites, everyone mentioned the delivery charges. The average overseas charge was £12.27, compared to £3.88 for UK delivery. We saw three different approaches: some retailers had attractive delivery charges of £10 or under, others were charging up to around the £16 mark, but then came the more unrealistic charges, such as £64.99. It is vital that retailers offer affordable delivery charges to overseas customers, otherwise they won’t buy.

• Ten percent of orders failed on the website. This was probably the most sobering finding of the whole report. Our shoppers were on a mission to buy and yet one in ten orders was rejected, usually due to payment or address failure. In every case, the shopper had successfully placed orders on other sites using the same card. Retailers really need to check their analytics and see if dropout at checkout is higher for international customers so they can work out what’s going wrong and why they are missing out on orders from willing customers.

• Address capture was a problem. Some of the orders failed on the website because the shopper was not able to submit his address. But even on the orders that succeeded, address input was often difficult--many shoppers reported confusing user experience and lack of support for foreign characters. The worst experience in this area, however, was a delivery to Brazil that failed because the retailer’s backend system cut off the second half of the first line of address--the part with the house number on it. The package got all the way to Brazil before being returned to the retailer, who sent our shopper an email to say it had received the item and she wouldn’t be getting her £25 delivery charge back.

• Only a tenth of retailers offered a choice of delivery options. In our UK report, 64 percent of retailers offered at least two delivery options--usually a standard service and an express service costing more but faster. But only 10 percent of the retailers gave the international shopper a choice.

• Six percent of the orders were offered free delivery over a certain order value threshold. In our UK report, 39 percent of orders were eligible for free delivery if the customer spent a certain amount. In this international research, only 6 percent of the orders were offered a similar promotion.

These are just a few examples from our findings, but they’re enough to demonstrate the conclusion that international customers are getting a very different service proposition to their UK counterparts. This presents challenges; should retailers offer free delivery overseas if orders reach a certain value threshold? I noticed that on Bastille Day this year, Asos offered free delivery to all customers living in France--this is a nice way to test the waters.

But the fact remains: international delivery works (only one order failed to arrive) and there are customers, especially expatriates and those in English-speaking countries, who are willing and able to buy online from UK retailers. Retailers need to see the potential in overseas growth and treat international customers as a target audience, just as they would their UK customers.

Sarah Clelland is marketing manager at ecommerce services provider Snow Valley.

Read the International Delivery Report, sponsored by Royal Mail, in full at www.snowvalley.com/research.