SUCCEEDING IN THE EUROPEAN ECOMMERCE MARKET How to find the balance between localization and standardization

Webwinkel Vakdagen Utrecht, 23.01.2013

Something about me…

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… 32 years old

… 5 years at Hermes Fulfilment

• International Business Development Manager

• Key Account Manager

… Primary Focus:

• International expansion of online business – Europe, USA, China and Russia

• International Fulfilment & Partner management

• International eCommerce projects

… Clients:

• Home Shopping Europe (HSE 24)

• Wolford AG

• MUJI Deutschland GmbH

• Chal-Tec GmbH

• Bombay Brands LLC

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Did you know that…

... Europe has 740 million population.

... Europe is the world’s largest eCommerce market based on total online revenue.

... internet retail sales volume reached €126.76 billion in 2012 – grew by +14.12% from 2011.

... there are 28 other currencies beside of the Euro.

... the United Kingdom, France and Germany dominate the internet retailing market, accounting for 62.65% of total value sales.

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Capture the Potential of Internet Retailing...

Source: Euromonitor Jan 2013

Each European Market is Different. Take a Look at…

…Language

… Common service times for call centers

… Preferred payment methods

… Currency

… Common delivery lead time

… Returns regulations

… Exclusion of delivery

… Delivery quota

… Sales Tax

…

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… Seal of Quality

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Your customers want to pay with…

UNITED KINGDOM

Others

PayPal

Debit Card

Credit Card

0% 10% 20% 30% 40% 50%

4%

21%

35%

40%

GERMANY

Cash on Deliverysofortüberweisung.de

Credit CardPayPal

Direct DebitingPayment in Advance

Invoice

0% 20% 40% 60%

1%8%

21%23%25%

37%52%

FRANCE

e-carte bleueDirect Debiting

ChequeVoucher

E-PaymentCredit Card

0% 50% 100%

8%9%12%12%

21%79%

ITALY

Others

Bank Transfer

Cash on Delivery

E-Payment

Credit Card

0% 20% 40% 60% 80%

4%

7%

9%

11%

69%

Σ

Credit Card x x x x x x x x x 9

PayPal x x x x x x x x x 9

Invoice x x x x x 5

Online Banking x x x x 4

Cash on Delivery x x x 3

Direct Debiting x x 2

sofortüberweisung.de x 1

Debit Card x 1

e-carte bleue x 1

Cash at Place of Coll. x 1

Payment Methods – must have vs. nice to have

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Σ

Credit Card x x x x x x x x x 9

PayPal x x x x x x x x x 9

Invoice x x x x x 5

Online Banking x x x x 4

Cash on Delivery x x x 3

Direct Debiting x x 2

sofortüberweisung.de x 1

Debit Card x 1

e-carte bleue x 1

Cash at Place of Coll. x 1

19.6% 100.000 € 15 days 5.95 €• French as language is legally

required for „Terms and Conditions“

21% 35.000 € 10 days 5.95 €• Storage costs for unsuccessful

shipments paid by customer

23% 35.000 € 14 days 4 – 6 €• No title in the communication,

informal communication is common

25% 320.000 SEK (= 35.000 €) 14 days 40 – 60 SEK

(= 4.50 – 7.00 €)• Usage of ID-number for online order • Opt-out for written ads

25% 280.000 DKK (= 35.000 €) 14 days 49 – 60 DKK

(= 6.50 – 8.00 €)• Return costs paid by customer• 50% delivery by Local Post

25% - 14 days 49 – 60 NOK (= 6.00 – 8.00 €)

• Special treatment of Spitzbergen• 95% of population (15-75y) buy online

20% 1.140.000 CZK (= 44.760 €) 14 days 4 – 6 €

• Sunday is a business day• Up to 8 local carriers (e.g. alza.cz)

19% 100.000 € 14 days 4 – 6 €• Widespread usage of

parcelshops and packstations

20% 70.000 GBP (= 85.473 €) 7 days 3 – 4 GBP

• Website must be accessible for handicapped people.

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From the Legal and Consumer Behavioral Perspective – the large differences in Europe

VATShippingthreshold

Right of Cancellation

Accepted Shipping Costs

Special Remarks

Shopping with Confidence - Pick the right one…

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Trusted Shop Guarantee - International

Combination of Certification, Seal of Approval, Customer Service and Buyer Protection

Allows customer evaluations

Thuiswinkel Waarborg - Netherlands

Highly appreciated by consumers for certified quality standards (e.g. data security, payment process)

complaint handling in case of disagreement with the customer

La Fevad - France

More than 500 membering companies

Recommended by the press and various shopping advisors in France

Euro Label - International

A cooperation of various national providers of internet certification

Compliance of the European Code of Conduct as prerequisite

Summing up localization and standardization…

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OPPORTUNITIES CHALLENGES

Capture the high sales potential

Be the second, if not the first

? Lack of transparency & experience

? Controllability is lower than at home

? Very heterogenic markets

? High complexity

? Cultural differences

Relatively mature business environment

Get higher brand awareness

Simple solutions in the market

…We can help.

Integrated Supply Chain Solution – The One for Europe.

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The entire supply chain from a single source: from modular concept to integrated solution

SOURCING & PRODUCT

DISTRIBUTIONTRANSPORT LOGISTICS E-COMMERCE

Product Development & Sourcing

Inspection & Certification

International Freight Forwarding

Fulfilment & Back-end Services

Web Shop & Online Marketing

Multi-Channel Fulfilment

Parcel Delivery

2-Man-Handling Shipments

Hermes Otto International

Hermes Hansecontrol Group

Hermes Transport Logistics

Hermes NexTec

Hermes Fulfilment

ADD/UP Connected Channels

Hermes Logistik Gruppe Deutschland

Hermes Ltd. UK

Hermes Italia S.p.A.

Hermes Logistik

B2C Russia OOO

Hermes Einrichtungs Service

Wolford – a Success Story.

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WAREHOUSING 6 RETURNS

PAYMENT & RISK

CALL CENTER

WEBSHOPSERVICE

DISTRIBUTION

FINANCE & ACCOUNTING

14 online shops in Europe and 1 online shop in the US.

Customer Service in 9 languages

7 integrated payment methods

All shipments to Europe stored, picked & packed in one DC.

Delivery to customers in 15 countries with 3 international and local carriers.

Automated system processing of 5 different currencies.

https://www.hermesworld.com

http://www.ecommerce-global.de