United States Country Guide 2017 Cross-Border Trading Report Your guide to international e-trading
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United States
Country Guide 2017
Cross-Border Trading Report
Your guide to international e-trading
A report researched & compiled by eCommerce Worldwide,
supported by
1
The US Cross-Border Trading Country Guide 2017 is the latest publication in a series of international trading guides produced and maintained by eCommerce Worldwide, our sister associations and supporters for a variety of key territories around the globe. These are designed to operate as comprehensive guides for cross-border e-Trading, exclusively focusing on the B2C markets in their subject territories. The complete set of published Guides are available for download on the eCommerce Worldwide website at ecommerceworldwide.com/countries and on the websites of our approved publisher network For more information please visit www.ecommerceworldwide.com or you can email info@ecommerceworldwide.com 2
CONTENTS
Foreword 4
Executive summary 6
The opportunity 7
Online & mobile statistics overview 11
m-Commerce 15
Cross-border shopping 17
Routes to market & marketing 18
Marketing 21
Legal framework & regulations 27
Logistics & delivery 29
Finance, payment & fraud 36
Taxation 39
Conclusion 41
About Landmark Global 42
About eCommerce Worldwide 43
3
FOREWORD By Landmark Global The size, scope and nuances of the US market have proved a challenge for many European retailers looking to establish a store presence in the country. From experience, however, the team at Landmark Global know that it is You can find more information about a market with lots of opportunity for the savvy Landmark’s services at: international digital retailer. www.landmarkglobal.com Representing one of the oldest and most affluent consumer markets in the world, the US should be approached with a healthy degree of care and understanding. It is a market made up of 50 states, each with its own tax regimes and laws, consumer preferences and infrastructures. 4
US consumers are adopting ecommerce, to the Landmark Global has a strong presence in the
tune of $394bn in 2016. Additionally, 77% of online country, with major distribution and fulfilment
shoppers have said that they are open to shopping centres in key areas, and a team that understands
internationally and 42% have done so already. that this is more than shipping boxes around
Yes, a proportion of this will be with their North the globe. Each item represents a promise to the
American cousins in Canada but the UK, China and customer, financial success to a retailer and the
Australia are also favourite shopping destinations. result of a partnership; a team that helps your
business grow and flourish in this exciting market.
Key to international sales success in the US is
the retail proposition. Customers expect to know This cross-border trading report will give you
the price they will be paying at checkout, have a invaluable insight in to this varied marketplace,
choice of competitive delivery options (or better highlighting key areas of interest and action points
than domestic retailers), localised payment options that you will want to consider. Every business
and service levels that make a business stand out. is different but the core themes highlighted will
Landmark Global understand these challenges and provide some direction to your considerations.
have the resources to make sure that both your
business, and customers, have a good experience.
A market of over 300 million connected
consumers is certainly worth aiming for,
and we are ready to help you
achieve your goals. p
sho nally
42%ernatio
int
US ecommerce spend
$394bn
in 2016
5
18th May 2016
EXECUTIVE SUMMARY
The Platinum Suite | ExCeL London
With the largest global economy, a population of over 324 million and internet penetration of
over 88%, the United States of America (US) is an attractive market by any measure. A strong and
growing GDP per capita of over $56,000 and widespread use of English as a main language makes
this multi-cultural market relatively easy to access. Its sheer size does present some challenges,
with most of the population either on the west coast or in the east of the country. Four main time
zones can make providing customer support a challenge, but internal infrastructure generally
supports rapid communications.
Ranked in 2015 as the number one country for Facebook dominates the social media landscape, and
ecommerce, the US is driven by consumer demand the increasing consumption of video through social
with overall retail worth $4.83 tn, and web sales platforms makes it – and others such as Snapchat –
recorded as $394 bn, up 15.1% in 2015. interesting marcomms channels.
With Compound Annual Growth (CAGR) predicted Email is an attractive marketing tool, with average
for online sales as around 7.4%, it is worth noting order values increasing to $116.10 in Q4 2016, and
that consumer electronics, clothing and personal response rates of 3.7%
care are expected to outperform the market with
Payments is dominated by credit cards, which
CAGR of around 10% each.
account for 47% of all online retail transactions with
The main players in the ecommerce field are PayPal, at over 20%, a requirement as well.
Amazon, eBay and Walmart, and desktop
Fulfilment options are key to competing with
transactions still dominate the device landscape.
domestic merchants. A blend of delivery options
However, mobile device usage is increasing,
should be made available, with 5-7 days acceptable
with 62% of online consumers having access to a
at an appropriate price point. It is important to
tablet, suggesting that desktop dominance may be
clearly state what the delivery promise is and to
challenged over the coming years. In the meantime,
consistently achieve this.
desktop is favoured by cross-border shoppers.
The legal situation is complicated by laws being set
The UK, China and Canada are top international
at Federal and State level. However, most consumer
destinations for US online shoppers. 77% of all
legislation is set at a state level, and areas such as
online users are open to the idea of shopping
returns requirements are left, predominantly, to the
internationally, whilst 42% have done so.
retailer. However, the wider market expectations will
Peak trading periods are like other territories — set these and often include ‘paid-for’ returns.
the US is the ‘home’ of Black Friday. However,
Taxation is a sales tax, and is paid for at point of
there are some differences that are worthy of note.
consumption. 12,000 tax jurisdictions can make this
Digital advertising is particularly strong, with a complicated area. However, imports of less than
overall spend topping $67 bn in 2016. Retail is $800 FOB are duty- and tax-exempt.
the biggest contributor to this, and whilst search
Whilst the US is not one market, with careful
represents 27% of this total, 47% was aimed at mobile
planning and attention to the retail proposition,
formats, pointing to the potential for strong growth
international merchants will find a willing audience;
in these devices.
variety, choice and value are key to success.
Google is key for an effective search strategy,
although some data sets point to Amazon.com being
the top consumer destination for product discovery
in the US market; making a presence in their
marketplace an attractive proposition.
6
THE OPPORTUNITY
Territory overview
World ecommerce rank 1 Official language None; English is language of
Capital Washington DC Government; Spanish (12.9%) also spoken widely
Largest city New York City Gross domestic product $18.03 trn
Area 3,500,000 sq miles Currency US Dollars (USD / $)
Population 324 million Internet TLD .us .gov .mil .edu .com
Components 50 states
With the largest global economy, a world-leading technology sector, and an affluent middle class, the US
is an attractive market to enter. Its population of over 309 million also represents a mixed cultural society,
and whilst English is spoken by 72.6% of the population, 12.9% speak Spanish. The cultural makeup stems
from the Americas’ mixed past, with colonial influences from Britain and France alongside South American,
Caribbean and African cultures figuring widely.
Figure 1 – Regional map of the US. Source: US Department of Commerce
7
Table one below lists all of the states, their approved abbreviations and postal codes. The eastern coast is made up of many smaller states whilst the central belt is made up of fewer, much larger states. State Abbreviation Postal code State Abbreviation Postal code Alabama Ala. AL Montana Mont. MT Alaska Alaska AK Nebraska Nebr. NE American Samoa AS Nevada Nev. NV Arizona Ariz. AZ New Hampshire N.H. NH Arkansas Ark. AR New Jersey N.J. NJ California Calif. CA New Mexico N.M. NM Colorado Colo. CO New York N.Y. NY Connecticut Conn. CT North Carolina N.C. NC Delaware Del. DE North Dakota N.D. ND Dist. of Columbia D.C. DC Northern Marianas MP Florida Fla. FL Ohio Ohio OH Georgia Ga. GA Oklahoma Okla. OK Guam Guam GU Oregon Ore. OR Hawaii Hawaii HI Palau PW Idaho Idaho ID Pennsylvania Pa. PA Illinois Ill. IL Puerto Rico P.R. PR Indiana Ind. IN Rhode Island R.I. RI Iowa Iowa IA South Carolina S.C. SC Kansas Kans. KS South Dakota S.D. SD Kentucky Ky. KY Tennessee Tenn. TN Louisiana La. LA Texas Tex. TX Maine Maine ME Utah Utah UT Maryland Md. MD Vermont Vt. VT Marshall Islands MH Virginia Va. VA Massachusetts Mass. MA Virgin Islands V.I. VI Michigan Mich. MI Washington Wash. WA Micronesia FM West Virginia W.Va. WV Minnesota Minn. MN Wisconsin Wis. WI Mississippi Miss. MS Wyoming Wyo. WY Missouri Mo. MO Table 1 – US state postal codes and abbreviations 8
ECONOMIC STATISTICAL OVERVIEW
Country statistical profiles: Key tables from OECD - ISSN 2075-2288 - © OECD 2017
Country statistical profile: United States 2017
UNITS 2012 2013 2014 2015
PRODUCTION AND INCOME Unit 2012 2013 2014 2015
USD current
GDP per capita 51 370 52 689 54 484 56 066
PPPs
ECONOMIC GROWTH 2.2 1.7 2.4 2.6
Real GDP growth Annual growth % 2.2 1.7 2.4 2.6
TAXES 2.2 1.7 2.4 2.6
Total tax revenue % of GDP 24.1 25.7 25.9 26.4
Tax on personal income % of GDP 9.3 9.9 10.2 10.7
Tax on corporate profits % of GDP 2.0 2.1 2.2 2.2
Taxes on the average worker % of labour cost 29.8 31.5 31.6 31.7
TRADE 2.0 2.1 2.2 2.2
Imports of goods and services % of GDP 17.1 16.6 16.6 15.4
Exports of goods and services % of GDP 13.6 13.6 13.7 12.6
Goods trade balance: exports minus
Bln USD -741.2 -702.2 -752.2 -762.6
imports of goods
PRICES AND INTEREST RATES
Inflation rate: all items Annual growth % 2.1 1.5 1.6 0.1
Inflation rate: all items
Annual growth % 2.1 1.8 1.7 1.8
non food non energy
EMPLOYMENT Annual growth % 2.1 1.8 1.7 1.8
Employment rate in population aged
% 46.0 46.5 47.6 48.6
15-24
Employment rate in population aged
% 75.7 75.9 76.7 77.2
25-54
Employment rate in population aged
% 60.6 60.9 61.3 61.5
55-64
UNEMPLOYMENT % 60.6 60.9 61.3 61.5
Unemployment rate:
% 8.1 7.4 6.2 5.3
total labour force
Last updated: 17 January 2017; disclaimer: http://oe.cd/disclaimer
Source: OECD Data (data.oecd.org). For explanatory notes, see OECD Factbook 2015-2016
(DOI: 10.1787/factbook-2015-en).
9Largest cities: According to the 2012 US census there are 745 places where more than 50,000 people live. Each state has a capital city but the following table shows the most populous cities in the US. Rank City; state 2012 population 1 New York City; New York 8,336,697 2 Los Angeles; California 3,857,799 3 Chicago; Illinois 2,714,856 4 Houston; Texas 2,160,821 5 Philadelphia; Pennsylvania 1,547,607 6 Phoenix; Arizona 1,488,750 7 San Antonio; Texas 1,382,951 8 San Diego; California 1,338,348 9 Dallas; Texas 1,241,162 10 San Jose; California 982,765 Table 2 – Top 10 US cities by population. Source: www.citymayors.com The population distribution is very much concentrated on the eastern seaboard with vast tracts of the central / western parts of the country being sparsely populated. There are also population centres on the western coast. This spread plays to the benefits of the digital economy but presents some of its greatest challenges, creating as it does cultural differences, four time zones and demands on logistics. Source – www.census.gov 10
ONLINE & MOBILE STATISTICS OVERVIEW
The technology pedigree of the US needs little introduction. Many of the globally-known household names
have originated from the country. Internet penetration at nearly 89% is as high as in most European countries,
although geography can make supplying the infrastructure difficult and expensive. Increasing at a rate of
1.1%, the total connected population is still showing signs of modest growth. The same issues with rolling out
the infrastructure also make the use of the internet and ecommerce attractive; in some areas it is difficult to
physically visit the stores of the most popular brands.
* estimate
Year Internet Penetration Total World
users** (% of pop. with internet) population rank ** Internet User = individual who can access
the Internet at home, via any device type
2016* 286,942,362 88.5 % 324,118,787 3 and connection.
2015* 283,712,407 88.2 % 321,773,631 2
2014 279,070,327 87.4 % 319,448,634 2
Table 3 – Status of internet usage in the US: Source: www.internetlivestats.com
Interestingly, the global position of the US in terms of total internet users has slipped from 2nd to 3rd
in global rankings, being overtaken by a more populous country, India. China still retains the number one
ranking on this measure.
Analysis in 2015 showed that the US online market was ranked as number one for attractiveness, being scored
particularly strongly in terms of growth potential and with consumer behaviour. This indicates an openness to
engage more fully in digital channels, and that the country has infrastructure to support this.
Rank Change Country Online Consumer Growth Infrastructure Online market
in rank market behaviour potential (20%) attractiveness
size (40%) (20%) (20%) score
1 +2 United States 100.0 83.2 22.0 91.5 79.3
2 -1 China 100.0 59.4 86.1 43.6 77.8
3 +1 United Kingdom 87.9 98.6 11.3 86.4 74.4
4 -2 Japan 77.6 87.8 10.1 97.7 70.1
5 +1 Germany 63.9 92.6 20.5 83.1 66.6
6 +1 France 51.9 89.5 21.0 82.1 59.3
7 -2 South Korea 44.9 98.4 11.3 95.0 58.9
8 +5 Russia 29.6 66.4 51.8 66.2 48.7
9 +15 Belgium 8.3 82.0 48.3 81.1 45.6
10 -1 Australia 11.9 80.8 28.6 84.8 43.6
11 -1 Canada 10.6 81.4 23.6 88.9 43.1
Table 4 – Top 11 countries for ecommerce. Source: A.T. Kearney analysis, 2015
11Total retail sales were reported to be worth $4.83 tn in 2016 by the US Department of Commerce. The same
report in February 2017 also showed that retail sales via websites totalled $3.93 bn in 2016, averaging 8.1%
of total retail sales over the year. Whilst web sales grew by 15.1% on 2015, total retail averaged 2.1% growth
through the year.
Web Sales ($) Growth (%)
2016 393,854 15.1
2015 341,729 14.6
2014 298,256 15.4
2013 264,279 16.5
Table 5 – US ecommerce retail sales. Source: US Department of Commerce, Feb 2017.
Total retail e-commerce revenue 7.4%
Fashion revenue 7.83%
Clothing revenue 8.44%
Shoes revenue 6.32%
Bags and accessories revenue 6.22%
Electronics and media revenue 6.51%
Consumer electronics revenue 9.68%
-0.01%
Food & personal care revenue 9.69%
Food & beverages revenue 8.76%
Personal care revenue 10.03%
Furniture & appliances revenue 6.76%
Furniture & homeware revenue 8.69%
Home appliances revenue 5.34%
Toys, hobby & DIY revenue 7.55%
Toys & baby revenue 6.19%
Sports & outdoor revenue 6.16%
DIY, garden & pets revenue 6.52%
Hobby & stationary revenue 9.7%
-2% 0% 2% 4% 6% 8% 10% 12%
Table 6 – Retail ecommerce sales CAGR in the United States from 2015 to 2021, by product category.
Source: Statista.com
Overall growth rates in ecommerce are expected to average out at 7.4% between 2015 and 2021. Categories
of particular interest are clothing at 8.44% CAGR, consumer electronics at 9.6% CAGR and personal care at
10% CAGR. Clothing is interesting as this reflects growth trends in other territories and for the international
merchant, a key area where local culture and design is often in demand in new territories. Consumer
electronics will be harder for cross-border sales as manufacturing and distribution rights may limit a
merchant’s ability to sell in to the US.
12In distance-selling, individual categories perform differently and the latest (2014) figures from the US
Department of Commerce reporting distance sales (catalogue and ecommerce) show fashion to be one of the
strongest individual sectors online. Interestingly, the sporting goods, book and music sectors are relatively
small overall and online accounts for almost as many sales as offline. By way of contrast, the drugs, health
and beauty aids sector is the largest mail-order retail sector, whilst ecommerce sales are still only a small
proportion of the total.
2014
NAICS Code Kind of Business Total ($ Mn) E-commerce
Total Retail Trade 4,636,345 298,595
441 Motor vehicles and parts dealers 1,021,184 28,278
442 Furniture and home furnishings stores 99,687 651
443 Electronics and appliance stores 104,012 1,308
445 Food and beverage stores 669,902 1,079
446 Health and personal care stores 299,891 659
448 Clothing and clothing accessories stores 250,775 4,199
451 Sporting goods, hobby, book and music stores 85,375 2,471
452 General merchandise stores 666,873 102
453 Miscellaneous store retailers 116,065 2,713
454 Nonstore retailers 470,196 255,578
4541 Electronic shopping and mail order houses 386,135 254,712
Table 7 – Table showing category distance sales; total and those via ecommerce. Source: www.census.gov
Providing a more focused view on the online retail picture, the tables below highlight the key product
categories and market share of each. In contrast to other global markets, electronics (including computing)
is still growing strongly, whilst apparel and accessories still outperforms at 18.7% growth through to 2020.
Electricals and fashion are the two core categories for retail in general and online is no exception.
2015 2016 2017 2018 2019 2020
Apparel & accessories 16.7% 17.6% 18.3% 19.0% 19.5% 19.9%
Computer & consumer electronics 21.4% 21.6% 31.7% 21.8% 22.0% 22.1%
Auto & parts 8.6% 8.9% 9;1% 9.3£ 9.4% 9.5%
Books/music/video 9.7% 8.7% 8.2% 7.7% 7.3% 6.9%
Furniture & home furnishings 7.1% 7.3% 7.3% 7.3% 7.3% 7.4%
Health & personal care 4.5% 4.5% 4.5% 4.5% 4.5% 4.5%
Toys & hobby 3.8% 3.6% 3.5% 3.4% 3.2% 3.1%
Office equipment & supplies 3.4% 3.4% 3.5% 3.5% 3.6% 3.6%
Food & beverage 2.2% 2.3% 2.3% 2.3% 2.3% 2.4%
Other 22.6% 22.1% 21.7% 21.2% 20.8% 20.6%
Table 8 – Showing US online retail sales by product category: Source: www.emarketer.com
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Second 500 Web Sales Growth Top 500 Web Sales Growth
Figure 2 – 2015 Online Sales Growth by Category, and by Size of Merchant. Source: internetretailer.com
Category insight from Internetretailer.com and top500.com shows some interesting differences in growth
between larger and smaller businesses, as well as key categories for growth. For example, smaller retailers
are seeing strong growth in apparel, computers & electronics, and sporting goods. Homewares and home
improvement are, however, dominated by the bigger brands. Whilst the stronger growth of the smaller brands
is probably inflated by them starting at a lower baseline, it does provide an indication that there is room in the
market for alternatives to the big names; some ideal categories for cross-border merchants.
Previous data-points have shown the overall trends for ecommerce growth in the US. It should not come as a
surprise to note that the leading online retailers (with two notable exceptions) are multi-category.
TOP 10 US RETAIL WEBSITES BY UNIQUE MONTHLY VISITORS
183 MILLION 41 MILLION
107 MILLION 36 MILLION
101 MILLION 34 MILLION
84 MILLION 33 MILLION
61 MILLION 19 MILLION
Figure 3 – Top 10 US online retailers by unique monthly visitors. Source: comScore July 2016
All of the brands present in this top 10 have also seen a substantial increase in the number of unique visitors
over the previous year. For example, Amazon is up from 164 million to 183 million, Walmart has almost
doubled, going from 57 million to 101 million, and Lowes has gone from 19 million to 26 million. Sears have
dropped out of the Top 10 for 2016, being replaced by Kohl’s who had 33 million unique visitors.
14M-COMMERCE
Mobile commerce, as a term, covers two distinct and very different device types - tablet and smartphone.
It is not unusual for a consumer to own both types of device, and increasingly retailers are seeing customer
journeys involving both before a purchase is made.
ecommerce, as a percentage of total retail sales, is growing strongly in the US. However, mobile commerce is
making the biggest gains. Early growth has been particularly strong and in the first half of 2016, Criteo reported
m-commerce growth levels of 30% by the top retailers. This growth brought the share of total ecommerce sales
via mobile device to 52%. Criteo also reported that the share of transactions made via mobile device increased
by 17% in the first half of 2016.
In a similar picture to the popularity of ecommerce brands, the Top 10 online retail site visits by unique visitor
on mobile in 2016 reflects many of the global brands known for their online presence. Similarly, the big US
retail brands also figure highly in the comScore report.
TOP 10 US RETAIL WEBSITES BY UNIQUE MOBILE VISITORS
143 MILLION 24 MILLION
70 MILLION 2 MILLION
68 MILLION 21 MILLION
61 MILLION 19 MILLION
42 MILLION 17 MILLION
Figure 4 – Mobile unique visitors to US retail brands via app or mobile browser.
Source: comScore Inc. (March 2016)
Worthy of note is the poor performance of BestBuy. At the time of the survey, the brand was significantly
underperforming the market in terms of mobile visitors through both app and mobile web. Anecdotal evidence
from a variety of sources, including Neumob, report that Best Buy invested heavily in a new app and mobile
optimised website during 2016 and this performed far better than expected, and is possibly the reason why
Best Buy ranked poorly earlier in the year.
The key to successful app and mobile-optimised website performance in the US is usability, including
navigation, speed, and particularly its ability to cope with peak trading periods. As with other markets,
the app vs mobile-optimised debate is still going strong.
As with all areas of digital trading, there are caveats to the ‘mobile first’ mentality. Desktop still provides an
important role in the customer’s digital journey, and more so in certain sectors.
15Share of Digital Commerce Spending by Platform
Video Games, Consoles & Accesories 49% 51%
Toys & Hobbies 46% 54%
Jewellery & Watches 41% 59%
Event Tickets 36% 64%
Music, Movies & Videos 32% 68%
Sport & Fitness 31% 69%
Flowers, Greetings & Misc Gifts 28% 72%
Digital Content & Subscriptions 25% 75%
Home & Garden 22% 78%
Furniture, Appliances & Equipment 21% 79%
Apparel & Accesories 20% 80%
Total Digital Commerce 19% 81%
Computer Software 15% 85%
Books & Magazines 14% 86%
Consumer Packaged Goods 12% 88%
Consumer Electronics 11% 89%
Office Supplies 11% 89%
Computers / Peripherals / PDAs 8% 92%
Mobile Desktop
Figure 5 – Share of Digital Commerce spending by platform.
Source: Comscore, ecommerce & mCommerce measurement Q1 2016
As this graphic from comScore illustrates, sectors such as consumer electronics and computers are weighted
strongly towards desktop sales, whilst mobile accounts for a large proportion of sales in video gaming,
jewellery and flowers.
Tablets are also an important part of the mobile commerce story, representing circa 14% of total ecommerce
retail sales. Research shows that the number of tablet users is expected to increase.
200
63.0% 63.9%
150 60.6% 61.9%
58.5%
100
147.2 155.5 161.5 166.5 171.3
50 million million million million million
0
2014 2015 2016 2017 2018
TABLET USERS % REPRESENTED
Figure 6 – The number of tablet users in the US and percentage of internet users represented, 2014 – 2018.
Source: www.internetretailer.com
Overall, however, the trend is a rapid move towards the mobile experience. Price point, complexity of the
purchase, and visuals all have a role to play in determining the right focus.
Overall, the US has a strong and growing ecommerce market. Worth over $393 bn and growing at around 8%,
there is a lot of potential for growth. A sound mobile offering will help international merchants gain traction in
this market, not forgetting a sound desktop experience.
TAKEAWAY: There is a lot of growth potential in the US
digital market, and a multi-device strategy is required to
realise optimum potential.
16CROSS-BORDER SHOPPING
A majority of US online shoppers are very open to purchasing goods and services from international
merchants, with 42% having done so, according to research carried out by Ipsos for Bronto Software in
December 2016.
Figures reported by Paypers.com showed that in 2013, 34.1 million cross-border online shoppers would buy
$40.6 bn worth of goods growing to 41.8 million buying $80.2 bn by 2018. US cross-border online consumers
primarily shopped with the UK (49%), China (39%), Canada (34%), Hong Kong (20%) and Australia (18%).
Typically, choice, price, and uniqueness are top of the list as reasons for shoppers purchasing cross-border.
49% The price is better internationally
43% The brands or products I like are not available in the U.S.
35% I wanted something unique not found in stores in the U.S.
20% The quality is better internationally
11% I like the status that comes with shopping internationally
10% I want to purchase products found while travelling or living abroad
Figure 7 – Reasons cited by online US consumers for shopping cross-border.
Source: UPS Pulse of the Online Shopper Survey, 2015
Desktop / Laptop / Notebook Smartphone Tablet
Other device (eg Smart TV, games console, feature phone)
2% 1% 1% 2% 2% 3%
8% 6% 5%
9% 6% 9%
7% 10%
10% 11%
13%
24% 19% 20%
27%
76% 81% 82% 68%
70% 69%
60%
North Western Eastern Middle Latin Africa Asia Pacific
America Europe Europe East America
Figure 8 – Device usage by US online consumers who shop overseas.
Source: PayPal 3rd Annual Global Cross-Border Report
Cross-border internet shopping is still done via a desktop although, at a combined 22% the
mobile consumer should not be ignored.
TAKEAWAY: US consumers are very open to shopping
internationally, with price and choice being the top
motivators. Use your brand’s uniqueness in marketing
activities to appeal to these consumers.
17ROUTES TO MARKET & MARKETING
Many of the promotional tools available to retail marketers globally were born in the US. This section
reviews some of these methods whilst also highlighting key opportunities. As ever, though, localisation is key,
and whilst the tools might be familiar, their implementation can be very different. Peak trading is
a good example.
As with other markets, there are peak trading days for retail in the US and these are reflected online.
The main holiday-based shopping days are around Thanksgiving and Christmas. Thanksgiving is
celebrated on the fourth Thursday of November, with the following Friday being Black Friday.
Thanksgiving
Black Friday
10PM
Cyber
Monday
Thanksgiving purchasers by device
11AM
10PM
54%
14%
32%
TUE WED THU FRI SAT SUN MON TUE
Figure 9 – Peak online shopping hours over the festive period.
Source: SLI systems
The following Monday is Cyber Monday, traditionally Global merchants will be well aware of certain
the peak online trading day. Cyber Monday scores key peak trading periods. However, there are some
strongly, as consumers can do a lot of research over subtle differences in the US market with Black Friday
the preceding few days and then look online to make and Cyber Monday being the key days that consumers
sure they are getting the best deal. It was originally a are well aware of. A plethora of websites exist purely
day designed by pure-play merchants to counteract to provide consumers notice of where the best deals
the peak for in-store shopping, Black Friday. Recent can be found on these two days.
years have seen an increase in promotional activity For example, Blackfriday.com.
online for Black Friday.
Also worth noting is the way in which consumers’
Other retail days are important but not to the same shopping habits are changing around these peak
extent. According to the National Retail Federation’s times. Not only are they increasingly going online,
Retail Insight Centre, average spending on the device type used is changing. 46% of all
back-to-school items has increased by 31% since 2004 online purchases were done via mobile device on
to $72.5 bn (€57.9 bn). Mother’s Day and Valentine’s Thanksgiving 2016, 32% of which was via smartphone.
Day are significantly more popular than Easter,
while Halloween is growing in popularity. The Super
Bowl (final) weekend in February is also a major US
retail event.
TAKEAWAY: Mobile and desktop need to be part of
any US strategy. Plan for peak and understand the local
nuances of these days.
18Social media
With over 170 million social media users in the US in 2014, and the figure projected to exceed 200 million by
2020, social media is as much a part of the retail landscape as in many other territories. According to Pew
% ofFacebook
Research, onlineisadults usage
regularly used by 79% of online Americans, whilst Instragram is used by 32%.
100%
Facebook is by-far the most dominant
US social media platform, with a share
80% of over 45% of total visits to social media
Facebook - 79%
during August 2015 in the US market.
With such a dominance, Facebook is the
60% place for shoppers to discover discounts
and news (www.sas.com). The video sharing
website, YouTube, is also an important player
40% with 21% share. Other platforms are relevant
Instagram - 32% to certain sectors. For example Pinterest
Pinterest - 31% works well in the fashion space. Pinterest has
LinkedIn - 29%
20% Twitter - 24% assisted 56% of active female Pinterest users
‘at least once or twice’ with a purchase of hair
care or beauty products. This percentage is 20%
0% higher than for male Pinterest users (PFS Web).
2012 2013 2014 2015 2016
Research by brandwatch.com in 2016 highlighted:
• Facebook now sees 8 billion average daily video views from 500 million users
• Snapchat users watch 6 billion videos every day
• US adults spend an average of 1 hour, 16 minutes each day watching video on digital devices
• 78% of people watch online videos every week, 55% watch every day
Demographic Composition of Major Social Networks
1.0
100% 3.5
8.9 8.4 5.5 7.4 7.5 8.0 8.7
10.6 7.7
90% 11.1
11.1 9.5
14.1 14.5 15.2 13.7
15.7 11.7
80%
15.5 14.4
70% 16.7 16.6 17.4
15.5 Age 18-24
18.1 18.3
29.2
60% 19.4
16.8 17.1 Age 25-34
20.5 20.9
50%
18.8
20.8 20.0 Age 35-44
40%
25.6 21.7 22.1
Age 45-54
30% 22.2 23.6 23.9
20.3 22.4
46.8 Age 55-64
20%
10% 22.9 26.9 28.1 Age 65+
16.5 18.2 16.8 16.5
15.5
0%
Table 10 – Mix of social media activity by demographic and platform; Source: comScore/marketingland 2016
Whilst the demographics of Facebook usage are fairly consistent across age ranges, Snapchat is particularly
heavily utilised in the 18-34 year old groups. The challenge for brands is how best to use this platform as part
of a commercial strategy.
19Electronics The prevalence of mobile devices
31%
is also reflected in social media
Home furnishings 40% interactions within the physical
Automotive retail environment. A 2015 report
32%
by Deloitte Digital showed that
Entertainment 18% shoppers purchasing baby /
Baby / Toddler toddler and home furnishing
56% categories were particularly likely
Apparel 29% to engage in social media. This has
obvious implications for marketers
Health / Wellness 33% in these categories, both in terms
Food / Beverage 21% of brands wanting customers to
convert in-store and those pure-
Table 11 – Percentage of consumers that use social media during their plays looking to tempt consumers
shopping journey by category; Source: Deloitte Digital with an online purchase.
TAKEAWAY: Develop a localised social media strategy
that matches category expectations, especially in the baby
and home furnishings areas. Consider building in video
content for increased effectiveness.
Search
Google dominates the search landscape in the US with 64% of total search traffic. However providers such as
Bing and Yahoo!, whilst not the majority players in the market, still represent millions of users.
Explicit core search share (%)
Core search entity
Nov 2016 Dec 2016
Google sites 64.0% 64.0%
Microsoft sites 20.3% 20.4%
Yahoo sites 12.7% 12.7%
Ask network 1.7% 1.8%
AOL Inc. 1.2% 1.2%
Figure 10 – comScore Explicit Core Search Share Report December 2016*
*“Explicit Core Search” excludes contextually driven searches that do not reflect specific user intent to interact
with the search results.
From a performance perspective, the same rules around SEO and advertising apply as they do in other
territories. One important element though is recognising localisation and terminology. From a search
perspective, this includes recognising that American English can be very different from British English.
For example, ‘colour vs color’ and ‘pants’ versus ‘trousers’. These are more obvious examples but serve to
highlight the subtleties that could impact the effectiveness of search marketing.
As with other territories, localisation should include the URL / domain name. ‘.com’ is used as the US top-
level domain. If this is available to a business then it offers further reassurance to US consumers wishing to
purchase from a merchant, in addition to the positive impact on SEO.
TAKEAWAY: A Google-based strategy and localisation of
search terms is key. Balance paid-for and SEO investment
and measure effectiveness regularly.
20MARKETING
Digital advertising in the US rose 19.1% in H1 2016 Social media advertising, still largely an unknown
to $32.7 bn, according to the Interactive Advertising quantity for many merchants, represented returns
Bureau (IAB). Historically, H1 represents 53% of of $7 bn in H1 2016, an CAGR increase of 54% over
the annual total and following that trend, total ad the previous year.
revenues for 2016 which are yet to be reported,
Search revenues have stabilised, being a more
should be circa $67 bn.
established advertising channel. However, they are
Reflecting the increasing importance of mobile, the massively shifting in terms of device usage. Desktop
IAB also reported that mobile advertising grew from search was down 12% on H1 2015 to $8.9 bn, whilst
30% of total ad spend in H1 2015 to 47% in H1 2016; mobile search now represents $7.4 bn.
a figure that is sure to increase as mobile becomes
more entrenched in consumers’ digital interactions.
Ad formats - first half 2016
Total - $32.7 billion
3% 1% 1%
3%
Search
7%
Mobile
27%
Banner 10%
Video
Classifieds 47%
Lead Generation
3%
10%
Search
48% Banner
39%
Video
Other
Figure 11: Mix of total US digital advertising spend.
Source: IAB/PWC Internet Ad revenue report HY 2016
The retail vertical is still the strongest sector for digital advertising, responsible for 21% of the
total digital ad spend.
TAKEAWAY: Mobile-optimised advertising is a key
component for any US digital advertising strategy.
21Email marketing
As part of the marketing mix, email marketing still provides an important tool for driving sales, both online
and offline. As with all marcomms activity, the key to effectiveness is in the offer. US consumers respond
well to free delivery offers, with 54% in a 2015 UPS survey saying that this would prompt a purchase.
Marginally behind, at 53%, was a discount offer. Interestingly, store events and direct mail still played
an important role for many consumers.
Likelihood that these promotional vehicles will prompt shopping
54% Emails offering free shipping
Emails with 53% Emails offering a discount
promotions
are more 34% Emails reminding you that you left items in your cart that includes an incentive
likely to prompt 31% Store events
shoppers to buy
from a retailer 28% Direct mail
than other formats
25% Text messages with promotions
23% Emails with product recommendations based on past purchasing
22% Emails reminding you that you left items in your cart without purchasing
21% Emails with product recommendations based on what others have purchased
19% Posts on social media
18% Ads that seem to follow you around the internet showing you a product you recently viewed
Q: How likely are the following forms of retailer advertising to prompt you to shop with a retailer?
Figure 12 – Role of promotional tools in prompting a purchase.
Source: UPS Pulse of the Online Shopper Survey, 2015.
Of all verticals, research shows that retail customers are being the most proactive in adapting to the
emergence of mobile and tablet devices, leading the way in numbers opened on tablet, and second only to
media and entrainment on mobile. According to Experian Marketing Services North America in Q4 2016,
56% of total email opens occurred on mobile phones or tablets in Q4 2016, matching the percentage seen in
Q4 2015. By contrast, only 41% of emails are opened by retail customers on a desktop.
US consumers are still using desktop, so whilst mobile is important, brands should not neglect the ‘traditional’
email experience, but rather adapt and acknowledge the different requirements of each device.
Variables Q4: 2015 Q4: 2016
Total open rate 25.0% 29.0% 15.9%
Unique open rate 15.7% 18.1% 14.7%
Click-to-open 9.2% 8.6% -6.1%
Total click rate 2.3% 2.4% 4.2%
Unique click rate 1.6% 1.7% 5.6%
Transaction-to-click 6.2% 7.5% 22.1%
Transaction rate 0.06% 0.07% 18.1%
Revenue per email $0.07 $0.09 29.2%
Average order $101.41 $116.10 14.5%
Bounce rate 2.7% 3.4% 28.7%
Unsubscribe rate 0.09% 0.10% 6.3%
YOY rate 9.6%
Figure 13 – Email performance analysis for Consumer products & services sector.
Source: Experian Marketing Services North America in Q4 2016
22The Experian report also highlighted some interesting developments in email marketing for the consumer
products & services sector. Open rates in Q4 2016 were up from 25% in 2015 to 29% in 2016. Revenue per email
was also up, as were average order values which moved from $101.41 to $116.10.
TAKEAWAY: Email marketing is still a key tool in
marketing to the US consumer. Ensure the offer is valid
and that priority is given to relevance.
Direct Mail
Direct mail still plays an important role in US consumer product discovery. According to the US Postal
Service, consumers receive 16 pieces of direct mail per week, compared to over 100 emails. 70% of direct
mail is opened and 79% read for at least one minute.
16 100
Emails per week
Pieces of direct mail per week
Figure 14 – Direct mail compared to email volumes.
Source: Xerox Direct Mail eBook 2016
44% of this mail is discarded immediately if it isn’t relevant whilst 80% of consumers are more likely to open
personalised messages. According to a DMA study in 2015, of those consumers who responded to direct mail,
54% went to a referenced website and 45% went on to make a purchase.
Figure 15 – Performance of Direct Mail vs digital marketing channels.
Response rates: Email: 0.2%
3.7% Paid Search: 0.2%
Other digital channels: 0.2%
Direct mail (Mobile, Social Media,
Display Advertising)
Source: Xerox Direct Mail eBook 2016
As a result, direct mail in the US competes very favourably with its digital counterparts. The DMA report
recorded response rates of 3.7% for direct mail, against 0.2% for email and 0.1% for paid search.
TAKEAWAY: Whilst comparing favourably to digital
marketing techniques, the ability to scale and individual
performance metrics won’t make direct mail right for every
business. Perhaps plan to use as a retention tool.
23Optimising customer experience
Retailing is always about the customer experience From a digital perspective, customers are
and this should be in line with a merchant’s particularly concerned with the availability of
proposition. US consumers are no different in support information. For example, 66% of the
this regard and generally have high expectations. shoppers surveyed said that they were happy with
the availability and clarity of information relating to
US customers are generally happy with the
returns. Furthermore, 59% of shoppers were satisfied
local retail experience, both online and offline.
with the ease of finding a retailer’s customer service
Figures from the UPS Pulse of the Online Shopper
phone or contact option via the website. 44% were
Survey (2015) showed that 62% of those questioned
satisfied with the ability to find a retailer’s live chat
were happy with the in-store experience, while 83%
option, and 43% were satisfied with access to live
said the same about online. However, the online
chat within the checkout experience. The last two
picture was varied and satisfaction depended on
points around live chat have some way to go and
device. The ‘traditional’ desktop experience was
the various contact points are even more important
felt satisfactory by 84% of those surveyed while
for a foreign business looking to trade into a
75% said the same about tablet and only 65% about
territory; they all provide potential consumers with
smartphone interactions. The main issues cited were
confidence in the brand.
screen size, size of imagery, and security concerns.
TAKEAWAY: provide clear mechanisms for customer
support and ensure they allow for the time difference;
including across the country.
Consumer confidence Fear of fraud
Consumer confidence in online is affected by many The fear of private data being lost by businesses feeds
factors, but the main areas of concern are fraud, the fear of fraud, particularly as data loss is most
delivery, returns, refunds, and data protection. often associated with payment card details. 57% of
According to a study commissioned by Truste, 92% American consumers are concerned about identity
of US internet users worry about privacy online, an theft, according to the 2014 Unisys Security Index.
increase on the 89% of 2013. Along the same theme, 60% of US consumers also say that they are unlikely
only just over half (55%) of US consumers trust to trade with a business again after there has been a
businesses with their data online, and 58% worry data breach.
about businesses sharing their information with
A privacy survey by GFK highlighted 48% of
other businesses.
consumers avoiding at least one type of online
The more worrying trend is that 74% of internet service; with 18% avoiding auctions, 17% online
users are more worried about online privacy than banking and 16% social networks.
a year ago. Solutions to this are not easy, but steps
Visa Inc’s 2015 digital commerce study found that 37%
include clarity of data use, clarity around gaining
of consumers questioned were not making purchases
consent, and giving customers the option to change
via a mobile device due to security concerns. 21%
their preferences, which all provide confidence that
didn’t make a purchase via a mobile device because
the brand is trying to do the right thing.
they didn’t know if their usual merchant accepted
There are also several trust marks and quality seals card payments via mobile.
available in the US market that would help reassure
consumers, particularly about foreign brands trading
into the country.
TAKEAWAY: Clear communications around processes
and protection will go some way to assuaging fears
around fraud.
24Marketplaces
The benefits of online marketplaces are numerous, but the biggest for a merchant looking to trade into a new
territory is the power of its brand. Even a well-known domestic brand will struggle against established local
brands. The marketplace provides a degree of legitimacy and comfort that reduces the barriers to purchase
for a local consumer. Whether they represent a short- or long-term partner really depends on the merchant’s
plans and brand strategy. In the short-term, the marketplace provides a low-risk method of entering a new
market and learning from the experience.
Many of the globally-known brands are US-based and for 65% of shoppers, their reviews are major
contributors to a purchase decision (UPS Online Consumer Pulse survey 2015).
The top US marketplaces are illustrated in the following table. BestBuy shut its marketplace down to third
party sellers in 2016.
Million Monthly unique visitors
Amazon 188
eBay 122
Walmart.com 110
Newegg 40
Sears.com 15
Rakuten.com 13
Table 12 – Online marketplaces – latest publicly available data; Source: various
A consumer survey by BloomReach in April 2016, revealed Amazon had 53% of consumers’ first
product search, with 27% for search engines and 19% for retailers. This really illustrates the power of
marketplaces in a shopper’s product discovery phase and therefore the importance of the channel for
the international merchant.
TAKEAWAY: Identify a marketplace partner that matches
your audience requirements and suits your ability to fulfil
and service their customer base.
25Loyalty and vouchers Customer acquisition and retention strategies can be very similar globally. However, the American retail market has long been known to be dominated by vouchers and coupons as a promotional tool. Some consumers are avid collectors and users and according to ilovecouponmonth.com, 37% of surveyed shoppers want all coupons to be digital. Digital and mobile coupons Values Projected number of US smartphone mobile coupon users by 2015 74.1m Projected number of digital coupon users in the US by 2016 126.9m Percentage of adult internet users in the US who use digital coupons 55% Consumer behaviour Values Share of respondents who use any type of coupon when shopping 93% People living in households that used coupons for groceries 181.37m Table 13 – Overview coupon statistics; Source: Statista.com Not only are vouchers / coupons widely available, 93% of shoppers surveyed about their couponing use said that they use coupons when shopping. To set some context, 55% of US internet users use coupons. As a promotional tool they certainly have their place, and distribution can be achieved via a number of focused voucher websites. The following table highlights the top 10 by estimated monthly visitors. Each have their benefits and slightly different way of operating. Choice will be down to a merchant’s retail proposition and appetite for discounting or value differentiation. Rank Website Estimated monthly visitors 1 GroupOn 30,000,000 2 RetailMeNot 24,000,000 3 Zulily 20,000,000 4 Coupons 18,250,000 5 ShopAtHome 18,000,000 6 SlickDeals 17,000,000 7 LivingSocial 12,000,000 8 Woot 10,000,000 9 eBates 7,500,000 10 FatWallet 6,000,000 Table 14 – Most popular voucher / deal websites in the US market; Source: www.ebizmba.com March 2017 Where mobile devices meet digital couponing, women are more engaged than men when using applications for ‘voucher’ sites. King Retail Solutions report that 14% of US female smartphone owners use the Groupon app versus 9% of men, 9% use the RetailMeNot app, and 4% use the LivingSocial app. Only 1% of the men surveyed used the latter two. Not all vouchers have the same impact, and there are regional differences to take into account. According to the UPS Pulse of the Online Shopper Study (2015) 61% of respondents in the US wanted a free product / gift certificate / cashback offer based on frequent purchases. Product discounts came in second at 58% and free shipping a close third at 57%. TAKEAWAY: Couponing / vouchers are a key part of the US retailing landscape. Use tactically, as in any other market and be aware of the impact of high redemption levels. 26
LEGAL FRAMEWORK & REGULATIONS
With a federal system of government, there is a wide range of legal influences on any business looking to trade
in to the US. Some legislation is set at the federal level, but most consumer legislation is set at the state level.
The following section provides a non-exhaustive list of key legislation and is intended to highlight the main
legal instruments that will affect a merchant looking to trade electronically in to the US.
Advice from the Federal Trade Commission states that whilst there is a ‘cooling off period’ of 3 days for sales
over $25 made in the physical store environment, an exception is currently in place for sales made entirely
online, or by mail or telephone. This means that unless the sold good is defective or if the seller breaks the
sales contract, then the consumer has no right of return.
However, a survey by e-BuyersGuide.com found that 86% of online shoppers rated return policies of
significant importance in choosing an online merchant. With this level of expectation, international
merchants would be advised to implement a returns policy that competes favourably with other in the
market. For example, free returns and an extended returns period; 30 days isn’t uncommon.
Smallbusiness.com notes that individual states may have tighter regulations in this area but many will
rely on the retailer’s own terms of contract to state the consumer’s rights in this situation.
Data protection is an issue decided at federal level with the Federal Trade Commission having overall
responsibility for its implementation.
Topic Area Relevant Regulations Purpose
Privacy and Data The Federal Trade Commission Act Regulation of the processing of personal
Protection (15 U.S.C. §§41-58) (FTC Act) data
Children's Online Privacy Protection Applies to the online collection of
Act (COPPA) (15 U.S.C. §§6501-6506) information from children, and the Self-
Regulatory Principles for Behavioural
Advertising.
Fair Credit Reporting Act Notification of breach of data security
(15 U.S.C. §1681)
Controlling the Assault of Non-Solicited Regulates unsolicited
Pornography and Marketing Act of commercial e-mail
2003 (“CAN-SPAM Act”), 15 U.S.C.
7701-7713
However, the state of California has its own acts covering data protection which will impact any business
that trade into the state; effectively making it a compliance requirement for most website operators aiming
at the US market.
Topic Area Relevant Regulations Purpose
Privacy and data “Shine the Light” law (Cal. Civil Code. Visibility of data disclosure to third
protection §§1798.83-1798.84) parties
California Civil Code Section 1798.82 Notification of breach of data security
The California Online Privacy Transparency around data security and
Protection Act (CalOPPA); Cal. BPC usage practices affecting consumers
§§22575 - 22579 residing in California
27Intellectual property rights are well covered in the US at a federal level and there are several other
important elements to take notice of, such as the PCI DSS payment card rules and those relating to
the provision of credit.
Topic Area Relevant Regulations Purpose
Consumer The Federal Trade Commission: 16 CFR Protect consumers from any “unfair”
Protection Part 435 Act; The Mail, Internet, or trade practice
Telephone Order Rule
Section 5 of the FTC Act (15 U.S.C. Sec. Protect consumers from “unfair
45(a)(1)) or deceptive acts or practices in or
affecting commerce”
50 states represent a mixed legal picture with most contract law being set at this level. The Uniform
Commercial Code is an effort to harmonise requirements across the 50 states, but is not federal law
and it is up to the individual states to adopt.
The key federal level bodies involved in consumer facing business include The Federal Trade Commission,
who are responsible for ensuring consumers are treated fairly; the Federal Communications Commission,
who regulate interstate and international communications by radio, television, wire, satellite and cable;
the United States Copyright Office, and the United States Patent & Trademark Office.
Law at the state level is a mixed picture, but there are several projects that seek to bring some harmonisation.
For example, the Universal Commercial Code.
Official sources of information include:
www.uscourts.gov US. Courts
www.ftc.gov US. Federal Trade Commission
www.uspto.gov US. Patents & Trademarks Office
http://copyright.gov US. Copyright Office
www.sba.gov US Small Business Administration
www.privacy.ca.gov State of California Department of Justice Office of the Attorney General
http://leginfo.legislature.ca.gov California Legislative Information
TAKEAWAY: This section provides a high level overview
of the complexities of the US legal system. It is advisable
to seek professional, local, advice before trading in to the
country. Design a returns policy that competes with local
merchants and highlight to consumers.
Disclaimer
This section of the eCommerce Worldwide US Cross-Border Trading County Guide document is provided for
general information only and does not constitute legal or other professional advice. eCommerce Worldwide
does not owe any duty of care to any reader of this section of the Country Guide document. You should consult
a suitably qualified lawyer on any specific legal problem or matter.
28LOGISTICS AND DELIVERY
The US market presents some very real logistics challenges, largely due to its size and scale:
• A population of 320 million within 134 million households
• A physical geographical area of 3.5 million square miles and line haul distances of up to 3,200 miles
• Four time zones
As a result, B2C home delivery within the US is dominated by companies able to match that scale,
most notably:
• The United States Postal Service – USPS
• United Parcel Service – UPS
• Federal Express – Fed Ex (now incorporating TNT)
• DHL
There are also regional carriers covering specific cities, states or multi-state areas and companies who create a
national coverage network by contracting with these regional carriers. These companies particularly become
an option when it is possible to manage inventory and returns ‘in country’.
Non-US retailers seeking entry into the US market for the first time will find that there are effectively five
routes to access the US delivery market.
Logistics Choices
Post
Using USPS as the final delivery agent, any retailer’s own domestic postal company can get goods to the USA.
As an example, from the UK Royal Mail’s Standard service with tracked and signed for options would be
suitable for ecommerce deliveries with a 5-7 working day delivery estimate.
In many markets, other service providers are also able to ‘inject’ parcels into the postal network, providing
commercial rates to compete with traditional postal rates, some of which act as the international arm of other
national mail service providers. For example, Landmark Global is part of bPost, the national postal provider
for Belgium and as such it can leverage its strong links with USPS. See Direct Access.
Domestic carriers
In addition to postal operators, domestic carriers in each country will accept online retail orders and ship them
to the US to be handed to local partners for delivery, often global carriers or postal carriers. Service times will
vary depending on the line haul arrangements in place and the US service partner chosen but for example,
from the UK:
• Hermes can provide delivery within 4 to 7 days
• DPD can provide service options spanning 2 to 7 days
Retailers already having a service contract with a
domestic retailer should start by finding out
what options they provide and can use this
as a benchmark.
29Global Carriers For retailers wishing to keep their orders within a single network throughout, the major global carriers all provide collection and line haul services from most places in the world, to the US. By way of an example, the services available to UK retailers are summarised below: UPS • UPS Express Plus – 1-2 business days – delivery by 09:00 • UPS Express – 1-3 business days – delivery typically by 10:30, by 12:00 noon or by end of day • UPS Express Saver – 1-5 business days – delivery by end of day • UPS Expedited – 2-5 business days – delivery by end of day • UPS Standard – day definite by date scheduled – delivery during the day Fed Ex / TNT • International First – next morning • International Priority – next day • International Economy – 3 days DHL Express • Delivery in 2 days with next day delivery to New York Direct Access Direct Access describes a solution where parcel volume is consolidated for each destination to achieve better air transport rates. Upon arrival in the destination country, orders are cleared through customs and injected into local networks (postal and carrier) for final delivery. To manage these more virtual networks Direct Access often comes with a managed service that may include: • Expedited clearance • Multiple points of entry – reducing ‘in country’ line haul costs and lead times • Calculation and payment of duties on behalf of the client • HTS (Harmonised Tariff Schedule) code classification management • Tracking events and proof of delivery (where applicable) • Tracked returns – for unwanted and undeliverable orders There are a number of companies providing such services including Landmark Global, wnDirect and P2P. For example using its postal heritage Landmark Global has 8 of its 22 global operating centres in the US allowing it to provide a 4-7 working day service to the US from the UK. Landmark Global provides an example of the full range of services available from Direct Access operators, allowing retailers to migrate to in country fulfilment and returns management as their volumes grow. These include: • Delivery Duty Paid – calculating the cost of duty, taxes and shipping costs in the preferred currency to be added to the cost of the product at check out to give the customer the full price of their order. • Outsourced fulfilment with full warehouse management, pick and pack and dispatch • Inventory management worldwide • Returns management including quality checking, refurbishment, restocking or consolidated return through collection or bulk delivery 30
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