The steadily escalating trade war could cost U.S. e-retailers sales from countries like Mexico, France and Italy where many cross-border shoppers are looking for lower prices. But it likely will have less of an impact on Chinese shoppers who are more likely to shop U.S. e-commerce sites for products they trust or can’t find at home.
That’s one conclusion from an annual cross-border e-commerce survey released this week by online payment technology firm PayPal Holdings Inc. PayPal surveyed 34,000 internet users in 31 countries in March about their attitudes toward shopping on websites in other countries.
Plenty of consumers in other countries shop U.S. retail websites: 21% of all respondents to the survey said they had purchased from a U.S. site in the past 12 months, including 34% of those residing outside the U.S. That was second to China, which attracted 26% of respondents to its shopping sites in the past year, including 43% of those living outside of China, according to the survey.
However, if trading partners slap higher tariffs on U.S. goods, raising what overseas shoppers must pay when purchasing from U.S. e-commerce sites, that could deter price-conscious foreign consumers from buying from U.S. e-retailers. Better prices was the most common reason cited by consumers who shop on websites in other countries (72%), followed by access to items not available in my country (49%), the ability to discover new products (34%) and higher product quality (29%). Respondents could select more than one answer.
But there were distinct differences by country in what prompts consumers to shop online across borders. A high percentage of consumers in certain countries cited better prices as the key driver of their international shopping, including Mexico (59% of respondents), France (52%) and Italy (49%).
But the main reason Chinese consumers shop cross-border is to obtain higher-quality products, cited by 54% of Chinese respondents. Access to items not available in their home country was the most important factor in Canada (56%) and also in Germany and Spain (53%).
Language is a significant barrier to cross-border shopping as 76% of consumers in the U.S., United Kingdom and Canada would not feel comfortable shopping at a website that’s not in their language, as well as 74% of Japanese shoppers. It’s slightly less of an issue on the European continent, with only 62% of consumers in France and 51% in Germany expressing this concern.
Other findings from the PayPal survey show:
- Consumers most often shop at overseas websites for clothing and apparel (68%), followed by consumer electronics and toys and hobbies (53% each).
- Consumers in the Middle East are the most avid cross-border shoppers, with 70% buying from foreign websites in the past year. 57% of Europeans, 48% of North Americans and 48% of consumers in the Asia-Pacific region shop online across borders.
- The top barriers to shopping at a website in another country were delivery shipping costs (25%), followed by slow delivery time, concerns that the product might not arrive and customs duties and taxes (each cited by 24% of respondents). 22% pointed to possible difficulties returning products.
- Consumers in larger markets where there are many domestic online shopping options tend to shop less at foreign websites. Only 6% of Japanese consumers purchased from a foreign website in the past year, 32% of German shoppers did so, 34% of U.S. consumers and 38% from those in the United Kingdom. But 84% of consumers in Ireland, 63% in Canada and 66% in Mexico have shopped online cross-border.
For more on the growing opportunity to sell to online shoppers in the world, read the 2018 E-Retailer Global Expansion Report from Internet Retailer.