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Make 2015 your most profitable holiday season yet


For most online retailers, Christmas 2014 was their busiest to date. UK consumer confidence was riding high, and sales over the holiday period were up 2.2% compared to the previous year. The average online seller will make more than half of their sales and profits in the three months leading up to Christmas as customers search the internet for the best deals on gifts and decorations.

Additional holiday sales that have their origin in the US (like Black Friday and Cyber Monday) took the UK by storm last year. Amazon reported its biggest day of sales ever on Black Friday 2014 – that is, until three days later when it recorded even bigger sales figures on Cyber Monday!

It’s little wonder that expectations of bumper sales are high this year too, and most e-tailers are already deep into preparations to keep up with the increased demand. There’s lots to consider:
 
  • Are you SEO optimised? Will customers be able to find your products out there among all the competition?
  • It’s time to get marketing – get those social media pages scrubbed up and ready to shout about your brand.
  • Are you running a promotional offer? Make sure you advertise it and bring those last-minute present buyers flocking to your site.
  • Do you have enough stock available to cope with the demand?
  • Are the logistics in place to ensure delivery before the 25th?
 

Make the most of the seasonal sales spike – it’s not too late!

Sales are set to increase all the way up to Christmas, so if you’re not one of the 59% of online retailers who started their holiday promotions in September this year (September?!) it’s not too late to give your business an extra boost.

It’s also not too late to maximise sales by diversifying the channels that you sell on. A good place to start is by researching new marketplaces in the countries you already sell in, or launching your products in a new country.

The UK was named in a recent report as the most popular online overseas destination for German shoppers, and the second most popular for buyers in China and the US. Add to that the fact that Chinese and German shoppers spend on average 2.7 and 1.7 times more in each online transaction, and these international markets become an exciting proposition.

International marketplaces like Amazon make it incredibly easy to replicate your listings and manage overseas transactions – so while seasonal demand is at its highest, now really could be the best time to test an overseas market.

A recent study by eBay enterprises showed the top five concerns of international buyers were:
 
  1. High delivery costs
  2. Unavailability of preferred payment options
  3. Poor product information
  4. Long delivery times
  5. Price differences because of exchange rates
 
If you can master these challenges, you’ll be well on the way to a thriving overseas store. Differences in exchange rates can not only result in unattractive prices for international consumers, but will affect your business in other ways when you start to sell overseas.

We’ve identified the three key foreign exchange challenges for e-tailers, and created some in-depth guides to put you in the know.

 
Pricing your product correctly

How to keep your prices competitive enough to entice international buyers, while protecting your margins from adverse movements in exchange rates.

 
Sourcing your products overseas

Many online sellers will look overseas for new product lines this Christmas. It’s a well-established trade route to import inventory from China, where manufacturing costs are often significantly lower, and then sell these products in the UK and mainland Europe. Recent economic volatility in Greece and China has caused exchange rates to move unpredictably, and anyone making international payments will need to manage the risk presented by these fluctuations.
 

Retrieving you foreign currency sales

When you’ve protected your cost price and have a well-established pricing strategy, it’s time to consider what happens after you have actually made a sale. Most online sellers using international marketplaces will have their seller profile connected to their domestic bank account, and will receive sales proceeds in their domestic currency.

The customer does not pay for the purchase in the seller’s own domestic currency, but will use their local denomination. This is received by the online seller’s marketplace, and then converted into the seller’s home currency at a fee.

Unfortunately for online sellers, the rate of exchange offered by marketplaces costs them an average of 4% of their total sales revenue – and in a competitive market when margins are tight, 4% could make the difference between the success and failure of your international venture.

This is our guide to cutting those costs in half!


The foreign exchange experts

Our e-tailer team will help thousands of online sellers to make the most of their international sales this Christmas, making foreign exchange as simple as possible so that e-tailers can enjoy the holidays and have more profits to spend on the things that matter, like turkey … or tinsel!

For more information, or to speak to one of our friendly ecommerce currency specialists, email [email protected] or call +44 (0) 20 7847 9269.  
 
 
 
sources
http://www.retailresearch.org/shoppingforxmas.php
http://www.theguardian.com/technology/2013/dec/03/amazon-uk-cyber-monday-busiest-shopping-day
https://www.trulioo.com/blog/2014/12/10/online-cross-border-shoppers-spend-twice-much-domestic-shoppers/
http://www.forbes.com/sites/fionabriggs/2015/06/08/uk-retailers-poised-to-benefit-from-growth-of-worlds-largest-online-markets-research-finds/
 

 

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