An international presence with global success was once something brands could only aspire to.

But with the arrival of ecommerce, countless brands have successfully scaled their reach to international territories, across all categories from Glossier and Ikea to Myprotein.

Despite these successes, scaling an ecommerce brand into new markets is not without its challenges.

Companies need to ensure adequate investment is provided for their global expansion, while also being aware of the new market’s complexities and how to navigate rising costs in ecommerce.

In this blog, we explore the challenges of expansion into a new market and how you can overcome them to achieve efficient scalability for your brand and global customer reach.  

A lack of market knowledge

Success at home doesn’t necessarily mean success abroad. As such, a business cannot expect to effectively scale into a new market without adapting their go-to-market strategy.

Investigating the market that you're seeking to enter is the natural first step for scaling into new territories. But finding the right insights to effectively fuel a global expansion isn’t always easy.

When preparing for the challenges of scaling into a new region, many companies get distracted by their total addressable market without considering the macro and micro factors that impact it.

Consumer awareness and education of a product is one such factor to consider. If, for instance, your target market consists of an audience that is well-versed in your product – coffee, for example, or wine – then your messaging would need to be specific and expert-driven to appeal to those consumers.

This is just one example. But it’s essential that you assess the market in depth to identify the demand for the product, the current competitor landscape and how the culture of the market affects consumer choices.

• Understand your new target market: Look beyond the total addressable market and take a deep dive into the customers that will be using your product. 
• Conduct deep customer research: Go beyond your usual research and explore cultural preferences and nuances that might impact your expansion. 
• Make it relevant: Understanding local traditions, celebrations and holidays can help position your brand seamlessly with the local audience.  

Limitations of your ecommerce platform

Whilst ecommerce can help brands cross borders, the tools and technology that enable it can also pose challenges – and that includes your ecommerce platform. 

Your chosen ecommerce platform is a crucial factor when scaling for international success. 

While your existing ecommerce platform might have helped you grow in your local market, expanding into a new market brings a host of factors to consider. 

Take your website domain, for instance. 

A key consideration when scaling your ecommerce brand. International domains give prospective customers confidence in a brand, increasing their likelihood of making a purchase. A separate top-level domain is an effective means of achieving this. You’ll also need to set hreflang tags to show search engines the language and geographical targeting of your new site. 

Your checkout and payment processes are another important factor to consider. 

To identify the right payments and processes for your target market, you’ll need to take a deep dive into consumers’ preferred payment methods. 

These can vary by country. Germans, for instance, have a cultural disinclination towards the use of credit, instead preferring PayPal for their online commerce. Americans, on the other hand, go the other way, with buy now, pay later (BNPL) and credit popular in the region. 

Indeed, with the US BNPL market expected to surpass $100 billion in 2024 and global BNPL transactions expected to increase by $450 billion by 2026, the technology is becoming more and more popular with brands. Offering BNPL options on your site capitalizes on this consumer trend and could encourage purchases from new audiences within your target territory. 

If your ecommerce platform doesn’t support the preferred payments systems, schemes and habits of your target market, it’s worth switching to one that does. 

For scaling brands looking to enter new territories, payments can be complex, often requiring immense market research and multiple vendors. 

THG Ingenuity makes it easy. Wherever you’re scaling to, our solution offers the gateways, methods and habits of your target consumers, all delivered by a single vendor, so you can hit the ground running as you scale.

• Localize your website: Use international domains and translate your online copy to appeal to local consumers – a dedicated translation partner like THG Fluently makes this easy. 
• Focus on the finances: Conversion rates, foreign currencies, payment habits and methods – these are just a few elements of moving into a new market. 
• Understand your current ecommerce platform’s limitations: If it is not designed to support the intricacies of global expansion, it might be time to re-platform.

Challenges in your logistics and fulfillment infrastructure

Understanding the logistical and fulfillment challenges of new markets and ensuring your operational set-up can handle them can be complex.

Indeed, one of the biggest hurdles that brands face is ensuring that their target market has ready access to a fit-for-purpose warehouse and fulfillment center infrastructure.

Consumers today demand fast delivery. As such, choosing a logistics partner that can help you fulfill orders quickly and efficiently must be top of mind.

The regulatory requirements of your target market must also be considered. Labelling, transportation requirements for combustible products, vehicular regulations – these can vary between different markets, and are just some of the elements you’d need to consider.

At Ingenuity, we understand the complexity and challenges that come with operations.

We have over 200 fulfillment centers worldwide, globally situated to ensure client and customer satisfaction. Our end-to-end operational solutions helped expand the beauty brand ELEMIS into 16 markets, with quick delivery and availability of stock prioritized throughout.

Wherever you expand into, your fulfillment and logistics infrastructure should remain a top priority.

• Different markets pose different operational challenges: Conduct in-depth research to understand the logistical and regulatory nuances of your target market for a smoother roll-out. 
• Choose a logistics partner you can trust: Understanding a new market’s fulfillment challenges can be difficult – a reliable partner with market insight and capabilities makes it easier. 
• Make final mile a success: Final mile considerations might require in-market courier networks that can be costly to access. Find an expansion partner that’s able to pass on cost efficiencies through economies of scale to ensure cost-effective growth. 

Expanding into foreign markets brings new growth, an increased customer base and greater revenue.
It can take time for brands to do this alone, but Ingenuity has the experience and capabilities you need to execute new market expansion at pace.

Thankfully, scaling into a new market doesn’t need to be complex. THG Ingenuity brings everything your brand needs under one roof, simplifying the complexities of digital commerce to help you discover greater growth in new markets.

If you’re looking for the right partner to scale your brand further, THG Ingenuity can help. Get in touch and take the first step towards international growth.