If you run an e-commerce business targeting the U.S market and want to expand into the European Union. It may surprise you to learn that your current marketing strategy may not work in the EU.
Europe consists of 28-countries, all with their own unique culture and identity. Successfully penetrating the European market requires you to adjust your marketing approach to each country.
If you think that Europe offers your e-commerce business an opportunity you can’t pass up. Read through these 5-tips for expanding your strategy into the European market.
B2C e-commerce is set to extend its reach in 2018, with total sales in Europe topping €602 billion.
The top-3 e-commerce markets in the E.U are, in order of size; The United Kingdom, France, and Germany. Of these, the U.K is the leader, with nearly €118 billion in annual sales. France follows the U.K as Europe second largest e-commerce market, with €93.2 billion in sales. Followed closely by Germany with €93 billion.
What’s trending in the U.K might not be of any interest in the French or German markets. Before you launch your product into the EU, make sure you do a thorough analysis of market trends in each country.
The E.U has 24-official languages across the continent. This language barrier makes communicating with your target market an issue if you only offer your website in English.
Other than the U.K, none of the other member country’s speak English as their primary language. If you were to send a sales offer to a French or German citizen, the chances are that they won’t even read it.
Speak to your e-commerce web development team and arrange a plug-in for your site that eliminates the language barrier. This plug-in software automatically translates your site and your sales information into the local language, without the need for your prospective customer to worry about converting the page.
If you’re used to American tax law. Then it may take some time to get your head and your bank account around the complexities of European tax legislation.
Each country has their own sales tax rate, with some choosing to use the VAT (value added tax) system, while others prefer the GST (government sales tax) model.
Don’t try and navigate the European tax legislation by yourself. If you make a mistake, it could cost you your business or land you with huge fines. Arrange to meet with an accountant that understands the complexities of European tax code and how it applies to each member country.
As with tax law, the legal system in Europe differs from country to country. Meet with a law firm and hire an attorney on retainer to assist you in handling any legal issues that may present themselves in the future.
The international business climate is becoming increasingly protectionist, with president Trump instituting tariffs on trade between the U.S, Europe, and China. Before you commit to any product, make sure you run it past your accountant and lawyer to see if tariffs will affect your profitability.