With seven out of every ten online shopping carts being abandoned, affiliate marketers are beginning to see real value in understanding the reasons behind it and in forging a new paradigm in respect of their strategies to convert their international traffic.
The international opportunity
According to atKearney.com global e-commerce has grown 13% annually over the past five years, with China, being at the top of the growth pile. English however remains by far and away the most commonly spoken language on the internet with many of the internet users from non-English speaking countries having the ability to read and understand English. According to internetworldstats.com about 80% of all web pages are in English and for many multinational corporations, English IS their official company language.
In many cases affiliate marketers are receiving international traffic to their sites and doing all of the hard work of enthusiastically persuading them to the buy a product without actually getting the commission that would normally accompany the sale.
Shipping Costs and Delivery Times
Excessive shipping costs are by far the top reason for online shopping cart abandonment according to a recent Forrester study, findings which are echoed by econsultancy.com, which outlines that along with the lack of free and discounted shipping another key factor which leads to a customer abandoning their shopping cart is long delivery times. Increasingly savvy online shoppers are demanding that the product arrives the next working day and is delivered at no extra cost. Affiliate Marketers have come to the realisation that they must actively participate in the price-transparent marketplace in order to compete and convert their international traffic into sales or risk leaving a large percentage of their achievable revenue on the table.
The road to profits
Even so there are still a very large percentage of affiliate marketers who send all of their potential customers to the same vendor, regardless of their geographic location. When the potential customer from a foreign country notices the inflated time and cost of delivery, the added inconvenience of having to pay in a foreign currency and an unfavourable returns policy, the obvious consequence is abandonment of the site and the purchase taking place through a more native vendor for the customer. So after having done all of the hard work in persuading the visitor to buy the product, the affiliate loses out at the very last hurdle simply because the traffic was not redirected to a suitable local vendor and via the correct affiliate program. If an affiliate is receiving more than a trivial amount of international traffic this can add up to a huge loss of revenue year on year.
The Amazon Problem
Let's take a look at an example of the problem which Amazon associates face, which has the potential to cost them a large percentage of their commission each and every month and why Amazon is uninsentivised to do anything about it. (This goes for iTunes, Groupon, Ebay, William Hill, British Airways and any other global program which runs country specific affiliate programs.)
Amazon has ten store fronts across the world in the United States, Canada, Brazil, France, Germany, Italy, Spain, United Kingdom, China and Japan. Each store front also has its own affiliate program.
Picture this: A visitor lands on the affiliates site and starts reading one of their blog posts about a new book which they are enthusiastically recommending. The visitor really likes the sound of it and decides to go ahead and purchase the book. So far so good!
She clicks on the affiliate link and arrives at Amazon.com.
The trouble is, she lives in the UK and doesn’t want to:
- Pay the extra for shipping or wait up to 32 business days for delivery
- Have to worry about the returns policy if the item arrives damaged
- Pay in US dollars instead of Pounds Sterling
- Pay any tax which may be added on the importation of the product
So instead of buying immediately, she goes to the UK store – amazon.co.uk – and buys the book there. The same sort of thing may happen with a visitor from any location outside of the US: A Canadian may go to amazon.ca, and so on which is why Amazon has absolutely no incentive whatsoever to do anything about the situation as it currently stands. The affiliate marketer puts in the time, money and effort to generate the sales, Amazon generally gets the sales through one of their international store fronts, but the affiliate only gets paid for the sales which have taken place through his local store front and via the corresponding affiliate program.
Hardly seems fair, does it?
It would seem that 2013 is set to be the year that affiliates look to target those previously neglected revenue streams.