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Looking for your next big cross-border market? New study shows Mexico is the up and coming ecommerce hotspot

Looking for your next big cross-border market? New study shows Mexico is the up and coming ecommerce hotspot

For U.S.-based ecommerce businesses looking to expand internationally, Mexico is an appealing option. Its consumer base is young and mobile savvy. Internet use and online shopping are on the rise. And based on a recent survey for ClearSale by Sapio Research, Mexican consumers’ customer experience concerns and expectations are similar in many ways to those of the U.S. consumer.

In March 2020, Sapio surveyed over 1,000 online shoppers in each of 5 countries: the U.S., Mexico, Canada, the U.K. and Australia. The findings indicate that selling into Mexico successfully might be easier than you’d expect—as long as you reassure shoppers of fraud protection, create a convenient shopping experience, and avoid false declines-declining good orders by mistake.

 

The Mexican ecommerce market now

Even before quarantines pushed more people to shop online, Mexico’s ecommerce market was growing. Mobile commerce is expected to grow at 23% CAGR through 2021. The cost of mobile internet plans has dropped over the past several years, and free public internet access has expanded across the country. Mexico’s expedited customs process for imports under $50 has made it easier for cross-border merchants and shoppers.

A willingness to shop with foreign brands is driving the ecommerce trend, too. According to PracticalEcommerce, two of the top five online stores in Mexico are U.S.-based (Amazon Mexico and Walmart Mexico). Mexico’s most popular online store, Mercado Libre, is based in Argentina. Two-thirds of Mexican ecommerce shoppers have made cross-border purchases online.

What do Mexican shoppers look for online?

Mexican shoppers want to know the stores they’re buying from are secure and trustworthy. Many hunt for deals online, especially during Hot Sales week in May and El Buen Fin in November. However, in the Sapio survey, Mexican and US shoppers were more inclined than U.K., Canadian and Australian consumers to buy from trusted sites, even if they have to pay more or wait longer for delivery.

Fears of online fraud are strong. Two-thirds of Mexican consumers said the possibility of fraud deters them from shopping online. By contrast, only 41% of US shoppers said the same—even though Americans are 40% more likely to experience fraud online.

In other consumer attitudes about safety and privacy, Mexican and US shoppers align closely. Among Sapio’s findings:

  • More than 80% of Mexican and U.S. online shoppers said they were more likely to buy from sites that they knew had fraud protection.
  • 56% of Mexican and US online shoppers said fraud protection is more important to them than keeping their data private. (Less than half of respondents in the U.K., Canada and Australia felt the same way.)
  • Mexican and U.S. shoppers were the most likely to check the sites they shop on before they enter personal details.

Despite the focus on security, a difficult or too-strict checkout process will drive Mexican shoppers away just as it does Americans. Forty-nine percent of Mexican consumers say they’ll ditch an online purchase if checkout is a hassle. Among U.S. consumers, 50% will do the same.

More than half of Mexican consumers said they’d permanently abandon a website if their order is declined by mistake. Thirty-eight percent of U.K., Canadian and Australian consumers said the same, along with 33% of U.S. consumers. Across all countries, an average of 14% would abandon a shop for good after experiencing fraud there. Clearly, fraud control can’t come at the expense of offending good customers in any market, especially Mexico.

Because US and Mexican consumers' fraud concerns and CX expectations are so similar, stores that balance those elements well in the U.S. have a head start on selling into Mexico. Merchants that need to improve here can leverage those improvements in Mexico, too.

For example, every merchant should study and reduce their false positive rate. Doing so reduces customer churn, increases customer lifetime value and lowers the average cost to acquire each customer. Controlling false declines before expanding into Mexico can help you build customer loyalty and avoid negative word-of-mouth.

Also, your mobile checkout process should be fully streamlined before you move into the Mexican market. Because mobile commerce accounts for roughly 1/3 of all online purchases there, and because shoppers will leave if checkout is too hard, debuting there with a great mobile experience can put you ahead of competitors.

As you plan to sell into Mexico, keep in mind that payment preferences differ from those in the U.S.. Mexican consumers are more likely to pay with a debit card or digital wallet than with a credit card. You’ll need to tailor your payment methods and your fraud controls to suit these preferences.

Win Mexican ecommerce shoppers with great customer experience

Mexican ecommerce is thriving, and U.S.-based merchants can benefit if they offer what Mexican consumers seek. To provide a winning customer experience, let shoppers know how you keep your store safe from fraudsters and be vigilant about preventing false declines. These steps can help you successfully move into the Mexican market and improve your relationship with your customers in the U.S. at the same time.

 

Original article at: https://www.mytotalretail.com/article/why-mexico-may-be-your-next-big-cross-border-market/

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