Study: 54% of consumers expect to increase cross-border shopping

54% of global consumers are expecting to increase their cross-border purchasing over the next six to twelve months. However, flexibility and transparency in the digital payment experience is necessary to make that happen.

This is according to global payments and financial platform Airwallex's recent Cross-border eCommerce report. 

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“eCommerce is more global than ever,” said Kai Wu, chief revenue officer at Airwallex.

“Despite ongoing economic uncertainty and slowing global growth, it is clear that consumer spending will continue to grow. With the global cross-border e-commerce market set to reach USD 7.9 trillion by 2030. It is critical for international merchants to solve consumer pain points and deliver the best possible customer experience in order to thrive in this competitive market." 

To increase cross-border spend, trust in personal data security is key. This is because 61% of consumers perceive international merchants to be trustworthy, while 65% expressed confidence in the security of their personal and financial information when buying from international markets. 

When it comes to international merchants, China was the top country that consumers from the United States (41%), Singapore (35%) and the UK (35%) shopped internationally from. 

Meanwhile, shipping costs and transparency are ranked as the most important factors when evaluating the shipping policy of an international merchant (41%) while lengthy refund processing times represent the most prominent challenge for consumers (47%).

Why is it so popular?

One of the reasons why cross-border shopping has become so popular is due to the greater product options when shopping internationally (34%). This reason closely competed with the desire for better quality products and lower prices, said the report. 

In Singapore, China and Hong Kong, greater product availability and superior product quality came out as top key factors. 

Another reason leading to its popularity is the global nature of social media. Social commerce recognises that social media is inherently social, and merchants are quickly leveraging social media platforms to create content and engage with consumers. 

In fact, 59% of consumers will likely make online purchases from international merchants through social media platforms. Consumers in China (86%), Hong Kong (76%) and Singapore (62%) showed the highest appetite for social commerce.

In addition, accessing better deals and offers on social media platforms (49%) was the top global motivation for consumers to buy from international merchants, followed by personal recommendations (42%) and interactive online selling (38%).

On average, consumers use Facebook the most (28%) to make online international purchases, followed by TikTok (22%) and Instagram (20%)

How to optimise for global success? 

According to the report, merchants should leverage influencers and social proof to build trust. Endorsement from international influencers and content creators has a significant impact on consumers’ decision to purchase from an overseas merchant, the report found. 

Merchants should also spend time generating authentic customer reviews on local websites. This is because 75% of consumers claim that ratings and customer reviews play a more important role in decision to buy from international sellers versus domestic sellers.

Additionally, these reviews serve a double function of increasing consumer trust and helping brands rank on local marketplaces and search engines. 

Merchants should upgrade its end-to-end payments too. This is especially since 77% of consumers would likely abandon their cart if their preferred payment method is not available.

At the same time, 54% are unlikely to return to online stores that do not transparently disclose additional fees such as currency conversion and international transaction fees. 

Out of all the payment methods, credit cards ranked as the most frequent (39%) followed by global digital wallets (26%). 

Lastly, merchants should manage fraud and risk whilst increasing payment authorisation rates ad build consumer confidence with logistics solutions. 

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