The UK is the world's leading ecommerce exporter with a trade surplus of £720 million in 2013, according to a new study.
The Global Retail E-mpire report, published today by OC&C Strategy Consultants in partnership with Google, analyses the estimated value of online retail based on six of the biggest e-commerce markets – the UK, the US, Germany, the Nordics, the Netherlands and France.
The UK’s online retail economy has generated an estimated trade surplus of £720m in 2013 – by far the largest in the world, thanks to global success stories in the fashion sector such as Asos, Net-a-Porter and Farfetch.
The US and Germany are the nearest challengers to the UK, with £110m and £12m trade surpluses respectively.
Asos relies on centralised infrastructure
Among the trailblazers, Asos now has websites targeting the UK, USA, France, Germany, Spain, Russia, Italy, Australia and China, and ships to more than 237 other countries from its central distribution centre in the UK.
Shaun McCabe, international director at Asos, said: "Our aim is to always offer our products to Asos customers globally and we use our brand and online marketing to build a loyal customer base in new markets.
"Supporting this is a simple and cost effective operation with a centralised infrastructure and team and operational back-end support, enabling us to serve the world from the UK."
Farfetch, global since birth
Online marketplace Farfetch is a fashion boutique that offers shops from 25 countries and delivers to more than 170. More than 80 per cent of its sales take place across a country border.
Andrew Robb, chief operating officer at Farfetch, said: "Farfetch has an atypical story because we took a global approach from the very beginning, shipping initially from five countries to the rest of the world. We believed the proposition of combining items from the best fashion boutiques would have global appeal, so long as we could provide a seamless customer experience.
"We now ship from 25 countries and have customers in over 170. A core part of our success has been implementing processes that work on a global scale, including customer acquisition, shipping, customs clearance and returns.
"We currently have operations in Europe, US and Brazil with websites in English, French and Portuguese. We strongly believe that providing a global product proposition with a localised, multichannel experience is the future."
UK luxury and fashion brands were also found to be performing strongly in the research, with Burberry, Dr Martens and Barbour some of the most searched-for British brands from overseas.
The opportunity for British retailers
Anita Balchandani, partner at OC&C, said: "Over the next decade, online retail will become increasingly international. This represents a great opportunity for British retailers, by providing new ways to grow and expand. At the same time, international expansion poses many challenges and will require retailers to master new capabilities and complexities.
"As a market matures, and new pockets of demand emerge, localisation will be crucial – from tailoring the range on offer, to ensuring that delivery and payment methods work for each market.
"It is equally critical to localise only where it matters to customers, to avoid the cost and complexity of over-tailoring the retail offer by country. Asos, for instance, services customers around the world from a single location in the UK, but executes its digital marketing activity in a localised way, allowing it to strike the right balance between customer relevance and cost."
eBay declares the death of distance
The report also confirms that eBay remains one of the world's largest online marketplaces to customers via any connected device. The site, founded in 1995, now attracts more than 124 million active users globally. Its collective impact on e-commerce is said to be "staggering", with more than 500 million items listed on eBay.
Online marketplaces such as eBay are reported to create opportunities for retailers of all sizes, allowing them to internationalise at low risk – researching consumer behaviour, testing their online offering and benefitting from the traffic and brand awareness of the marketplace itself.
Alex Von Schirmeister, vice-president of eBay, said: "We believe it's time to declare the 'death of distance'. Cross-border trade on eBay in the second quarter of 2013 reached $11 billion, representing 22 per cent of the company’s total commerce and payment volumes.
"EBay enables retailers to seize this cross-border opportunity with minimal red-tape. Retailers and brands choose eBay because we are a partner, never a competitor, and offer a range of services to businesses including inventory optimisation, and assistance with language and shipping solutions.
"Over 95 per cent of British businesses on eBay, both big and small, already export around the world. Across Europe, for instance, brands such as Sojeans, Boohoo and Cyberport are selling internationally through us."
Peter Fitzgerald, director at Google, said: "The global increase in the number of people with internet access, coupled with a rise in consumer confidence, combine to provide the ideal market conditions for e-commerce. The success of UK retailers can partly be attributed to operating in the most advanced ecommerce market in the world, but also to the high level of trust international customers have in UK brands and retailers.
"Looking to the future, any retailer wishing to enter the market must adopt a digital-first strategy to succeed."Follow @DurraniMix
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