PayU, the online payment service provider operating in 50+ emerging markets, has announced the results of its US survey which reveals a big opportunity for international merchants to capitalise on US consumer demand not being met domestically.
The survey found that almost half (48 per cent) of Americans who have bought online from retailers based abroad in the last year, have done so at least once a month. Furthermore, over half (53 per cent) have purchased products from China over the past 12 months. Other than China, Americans have purchased products from Europe (33 per cent), Canada (28 per cent), Southeast Asia (21 per cent), and Latin America (21 per cent).
Looking at those who have not shopped online from abroad in the last 12 months, only a quarter of this group (26 per cent) said feeling they should support stores located in their own country was a reason for not doing so. Furthermore, only 30 per cent of those who have not shopped online from retailers based abroad said this was because they could get everything they need from US-based retailers. These two viewpoints represent a major opportunity for international merchants.
A significant barrier to shopping online from abroad amongst nearly a third (29 per cent) of those who had not shopped this way in the past 12 months was high delivery costs (including tax). For those between the ages of 18-24 who hadn’t shopped online from abroad, the main reasons to not do that were high delivery costs and complicated return processes (23 per cent), while only six per cent of people in this age group indicated that they could get everything they need from the local retailers.
Fashion, shoes and bags were the most popular items to purchase for American consumers, with a third (31 per cent) having bought or said they considered buying these products from abroad in the last 12 months. This was followed by electronics (phones, tablets, laptops, computers, including accessories and peripherals) (29 per cent), books (26 per cent), toys, hobby and DIY (25 per cent).
Payment methods are a key factor for American consumers
The survey also showed that payment methods are a key factor for American consumers when it comes to purchasing from abroad, with 55 per cent of Americans saying they would look elsewhere or not make the purchase at all if their preferred payment method was not available.
Additionally, almost three quarters (73 per cent) of respondents noted that they felt safer making purchases online – whether domestic or abroad – if they recognised the brand of the payment service provider, with 36 per cent of those surveyed saying that their knowledge of the payment service provider influences their purchase decision.
The data also showed that when shopping online with retailers based abroad, the appetite for using buy now pay later is still relatively weak in the US market, with only one in 10 Americans who had bought from abroad in the past 12 months using the option. This compared to 55 per cent of those surveyed who noted that they used credit cards most often.
Mario Shiliashki, PayU’s CEO of global payments said: “It is clear that the trend for shopping internationally is accelerating, even in well-served markets like the US. This growing trend represents an ever more attractive opportunity for retailers to boost their growth by extending their business outside their home countries.
“To capitalise on this opportunity, it is important that merchants have the right technology partners to navigate the complex payments and logistics landscape in order to provide the best consumer shopping experience locally – one critical aspect of that is to optimise their ability to offer the most relevant payment methods in every market they expand to.”