It`s a small world

With the Internet ­reducing the virtual distance between countries and rise of technology that greases the wheels on operations like fulfillment and currency conversion, it might seem an easy matter for U.S. online retailers to flip the right switch to sell abroad. But cultural differences in marketing across borders complicate the picture, as shoemaker Nike learned the hard way.

When Nike launched a shoe in the Middle East bearing a decorative element meant to suggest the shape of a flame, Muslim consumers instead saw in the outline of the design a shape that, to them, suggested Arabic script for Allah. Placing the deity’s symbol so close to the sole of the foot—considered unclean in the culture—led to a marketing controversy and even a brief boycott of Nike before the company made amends for its blunder.

Customs and culture

Nike’s story, though extreme, illustrates the point that in selling online in other countries, success requires more than the right technology—it pays to study up on the local customs and culture, too.

And the concern is not just in product and product display—it’s in how consumers shop, too. In the U.K., for example, online electronics retailer Etronics Inc. has found online shoppers aren’t as inclined to use shopping engines, and that Google search isn’t driving the volume of retail traffic that it does here. “In England, a lot of the ad spend is on banner ads,” says marketing manager David Dwek. “Here, direct response sellers don’t use banner ads so much.”

With so much invested in technology in what may be ninth and tenthgeneration web sites here, it’s tempting for U.S. eretailers to approach foreign markets with the thought of just plugging in abroad what’s been painstakingly refined to work well at home. But if they do so without reviewing cultural considerations that bear adjustment on the site or in the online ­marketing plan—some obvious, some less so—they do so at their own peril.

“When retailers go into a new market, they often focus so ­heavily on logistical issues that they overlook cultural and linguistic issues,” says John Yunker, president of Byte Level Research, which advises ­retailers on selling into overseas markets. In the apparelselling realm, for example, certain countries are sensitive to the failure to use local models, Yunker says. Some cultures are offended by the amount of skin that is displayed without a second thought on some U.S. apparel sites; certain poses are also considered offensive.

Other differences that can affect efforts to sell online abroad may be less immediately apparent and ­buried deeper in the culture, such as, for example, how people like to shop. One mistake made early on by U.S. retailers operating in the German market is that Germans shop the way Americans do—but it’s a debit card, not a credit card, culture.

OBO required

Here’s another example: In China, though the rate of Internet ­penetration at about 7% is still low, growth prospects and interest in Western goods have many online retailers eager to gain a foothold. But U.S. retail sites operate on a fixed price basis and it’s the habit of Chinese consumers to negotiate a price on most things. U.S. online retailers haven’t yet had to figure out whether or how to accommodate that capacity on their web sites because the relatively few Chinese shopping U.S. sites accept that they are shopping in a different environment with different rules and customs—but evolution and eventual competition will change that, says Brent Rusick, CEO of cross border fulfillment and logistics provider Comerxia Inc.

And what Rusick says about China also applies to any emerging online marketplace. “Supply and demand are driving that business today as opposed to customer experience, but that will evolve,” he says. “As the world as a marketplace continues to shrink, it will move from supply and demand being the big drivers to customer experience, price, and how well you communicate to consumers in a local way that’s comfortable for them.”

eBay.com, Sweden’s Ikea, and a few others have already moved in that direction, having localized international web site templates for multiple countries. Some of the largest retailers have been slower to create a foreign web presence. Though it has stores all over Canada, WalMart Stores Inc., for example, has yet to go online there. Other large U.S.based retailers are somewhere in the middle; Sears Holdings Corp.’s Lands’ End, for instance, which handles sales from around the world through its catalog and call center, also has dedicated web sites in Germany, the United Kingdom and Japan.

A resource game

As with any other retailer ­initiative, exporting a web site is a resource game. Traffic and, most importantly, sales must justify what can be a significant investment in ­dedicating a foreignlanguage site, and most retailers take interim steps before making that commitment. Fulfillment and logistics platforms such as Comerxia’s allow U.S. online retailers to sell in other countries without having dedicated, countyspecific web sites to do so, and that’s one way to grow a customer base into one that will justify the launch of a dedicated site.

“The subject of international orders come up quite a bit,” says Tom Lindmeier, director of ecommerce at web and catalog retailer Junonia, which sells plussized women’s active apparel. “Our metrics tell us that if we want to go overseas, Great Britain would be a great place for us to go. They are already finding us over there. But we are a fairly small organization, so we have to make a decision: there is this much interest, but what is our payback?”

So far, that rationale has ruled out dedicated foreign web sites for Junonia and focused accommodations on the site for exU.S. ­customers largely on those for Canada. Junonia is currently streamlining the checkout process for Canadian customers and is working on negotiating a better shipping rate to Canada with UPS. The site currently directs online shoppers from anywhere else to its call center to place an order.

The road to a dedicated foreign site generally starts with retailers localizing more content as volume from other countries builds on a U.S. site, says Rusick. “We recommend that sites start out with the baseline of identifying high on the front page that international ­shipping is available,” he says. Successive steps after that on the way toward a ­countryspecific site include ­increasing countryspecific communication with customers, incorporating IP ­globalization to automatically determine where the online consumer is coming from and then, on product pages and other areas of the site, automatically ­converting price and cost displays into the local currency, he adds.

A moving target

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On the front end, ­merchandising and marketing, less tied up in pure technology and more affected by the local culture and values, can be a bit trickier to manage. “Culture’s a moving target. It’s a living thing, always changing,” says Yunker, who notes that that one way for U.S. retailers to capture those nuances is by turning to local partners. For a small business, those local partners could include the web site’s translators. “Generally, you use incountry translators. If you just look at them as someone who’s providing translation, you are missing an opportunity to get at their knowledge of the culture,” he says. “Have them look at your web site and provide some subjective feedback.”

“Americanisms” such as “home run,” “strike out,” and other idioms don’t ­necessarily travel well across borders, Yunker notes. Nor does humor. “Retailers with marketing materials built around ­playfulness might want to take a big step back before they even hire a translator,” he says. Similarly, while models might be the way to sell products in the U.S., that bears rethinking when tweaking a web site for global traffic or designing a dedicated site to support a specific foreign market. “Make the product the star and avoid some potential issues,” Yunker suggests.

While going with local ­consulting help is one answer, that still can leave some culturallyembedded issues obscured, he cautions. Focus groups, a regularlyused market research tool in the U.S., may not be as effective in other cultures, for instance. “In certain cultures, people aren’t necessarily going to tell you what puts them off, because they don’t want to criticize someone’s web site to their face,” says Yunker. “It’s hard to get at that information in some cultures, particularly in Asia.”

Etronics is still looking for the right marketing formula abroad. It uses Comerxia’s platform to support fulfillment and logistics in selling to a number of ­countries outside the U.S., but Dwek, the marketing manager, says that countryspecific shopping habits provide an extra layer of challenge when it comes to moving off the site itself and into acquiring new online customers.

For example, Etronics has had significant success online at home with comparison shopping engines. So when trying to formulate an online marketing plan for Etronics in the United Kingdom, Dwek’s first thought was to approach the engines, which are developing an international presence and which had offered him the opportunity to test that capacity. “I thought they’d have a lot of data on what people were clicking on and, presumably, buying, but I really got no guidance there,” he says. “It’s been a real challenge to find good advice.”

Dwek’s experience with seeking ontheground consultants outside the U.S has yet to deliver the marketing insights he’s ­looking for. “It seems that most of the available resources try to fit you into their hole, as opposed to their understanding the needs of an American retailer,” he says. “The reality is, it’s different over there.”

Etronics’ experience highlights the core of what faces eretailers ­looking to sell outside their own country and culture. While most direct marketers are accustomed to isolating and adjusting for variables, the number of variables soars when marketing abroad. That makes the U.K.—for now—the best target ­market overseas for Etronics, ­according to Dwek. “We have wondered how we can reduce the number of variables so we can begin to understand what is going on,” he says. “This allows us better control of the variables. Instead of product, price culture and ­language, we’re dealing with product, price and culture.”

The Canadian factor

Closer to home, Canada is often the first major push outside the U.S. for American online retailers. Though it may seem an easy hop across the border, in fact, there are significant differences marketers are wise to bear in mind, says Patrick Bartlett, president of Canada Post Borderfree, which offers technology and services to help U.S. marketers sell in Canada.

For one thing, while a U.S.based retailer’s brand messaging may have ­saturated the home ­market, Canadian ­consumers have not had the same exposure. “They may have some knowledge of your brand, but you probably want to spend more time with Canadians telling them about your brand promise,” says Bartlett. U.S. marketers also may not stop to consider how they are perceived in a country that on the surface, seems so similar—and how understanding the Canadians’ view of the U.S. can turn into a marketing advantage.

Buying online is one thing; buying online from Americans is another, says the Canadabased Bartlett. Canadians who buy across the border in the U.S. know they will have to deal with the issue of price and currency conversion and ­figuring out shipping and handling costs; experience has made it a part of their mindset in a way that’s not top of mind for Americans who rarely have to look outside their home country to find any consumer product. As a result, part of Canadians’ perception of the quality of the shopping experience at an American online retailer is the extent to which merchants make this easy for them versus leaving it to Canadian shoppers to resolve the differences themselves, according to Bartlett.

“American merchants have done a wonderful job of working on the buying experience for their ­consumers. When they go to international markets, they may leave it to the consumers to reconcile these problems and differences. Then they wonder why they aren’t as ­successful on the international markets,” Bartlett says.

Subtle differences

Though the world’s a potential online marketplace, it’s a marketplace that’s not necessarily easy pickings. The subtle and notsosubtle differences in shopping habits and cultural values among countries mean that one size—and one ­marketing and merchandising plan—does not fit all. Irrespective of how successfully their web sites function at home, U.S. marketers are finding that the bid to establish a significant online ­presence abroad raises a new challenge in every country.

“The bottom line is a lot of what we use here doesn’t apply aboard,” Dwek says. “You have to be really cautious in terms of your approach, and you have to create a test plan that allows you to leverage the risk.”

mary@verticalwebmedia.com

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