Price, Shipping Costs Motivate International Buyers, PayPal Study Finds

Cross-Border Consumer

Good news for online merchants selling products and services to customers in international markets. According to a new PayPal Cross-Border Consumer Research 2015 report (PDF), cross-border sales are on the rise, and the U.S. is the most preferred destination for online shopping.

The findings reveal a number of interesting consumer insights.

Key Takeaways

The research investigated the online and cross-border shopping habits of more than 23,200 consumers in 29 countries to understand how and why people shop online, and how they pay for cross-border transactions.

Some of the key findings of the PayPal Cross-Border Consumer Research report are:

  • The greatest prevalence of cross-border shopping is in Ireland (79 percent), Austria (78 percent) and Israel (71 percent)
  • The majority of cross-border purchases are made on a computer, although mobile devices are more popular in the developing countries
  • Clothing and apparel (49 percent) is the most popular category for cross-border purchases, followed by consumer electronics (32 percent), entertainment and education (31 percent), and travel (31 percent)
  • The majority of consumers (64 percent) prefer large global stores when purchasing from another country

Price and Shipping Costs Drive Purchases

A key finding was consumer attitudes towards price and shipping costs. About 73 percent of surveyed respondents cite better pricing as a key reason to make an international purchase. It’s also interesting to note that 50 percent of respondents say free shipping is a potential motivation for cross-border shopping. In fact, 47 percent of them say delivery costs prevent them from making international purchases regularly.

In other words, being sensitive to product and shipping costs can boost your chances of attracting customers in the international markets.

Why You Need to Focus on Mobile and SEO

Mobile commerce is a key driver of global online shopping, the study says. The assertion is based on the numbers that clearly prove mobile matters more than ever. For example, 47 percent of online shoppers used their smartphones to make a purchase last year.

It has also found that Nigerians who conduct nearly 37.8 percent of their online spend using smartphones lead in mobile shopping. They are followed by China (33.6 percent).

The trend suggests growing demand for online shopping apps that save time and make transactions safer and simpler.

But it’s not just mobile commerce that is driving cross-border purchases. Fifty-eight percent of cross-border shoppers said they go directly to the website they have used in the past to make purchases. 40 percent go to websites they know the address for, while 36 percent visit sites recommended by friends and family.

It goes without saying that SEO plays a key role in drawing consumers to international shopping.

Cross-border selling is tricky, but if done right, it’s also extremely rewarding. You just need to have the strategy and means to make the most of it.

Shipping Photo via Shutterstock

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Shubhomita Bose Shubhomita Bose is a Staff Writer for Small Business Trends. She covers key studies and surveys about the small business market, along with general small business news. She draws on 8 years of experience in copywriting, marketing and communications, having worked extensively on creating content for small and medium sized enterprises.

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