Uncrossing the Wires of Cross-Border Commerce

By the end of 2015, cross-border eCommerce is expected to reach more than $300 billion. But are merchants ready to optimize their eCommerce sites to welcome shoppers from other countries? and Digital River set out to understand just that by researching hundreds of eCommerce sites in 10 countries.

In a recent live webinar, MPD CEO Karen Webster and Rick Barbari, Group VP of Payments Products at Digital River, discussed their findings in putting together the X-Border Payments Optimization Index: how prepared merchants are (or are not) to take advantage of the opportunity that is cross-border commerce, and the elements necessary for success.


Webster set up the conversation by recalling a famous cartoon in The New Yorker that said, “On the Internet, no one knows you’re a dog.”

While it’s an iconic cartoon, Webster noted that it’s also “a little last-century.” She suggested to Barbari that the two of them could collaborate on a new one that states, “On the internet, everyone knows you’re a merchant.”

Barbari acknowledged that the statement rings true and added that, “all too frequently, as a merchant, you don’t always completely understand who your customer is. Not that you’re selling to dogs, but you don’t necessarily know where your customer is coming from all of the time.”

That, he remarked, would be an important point to keep in mind throughout the webinar.



The first slide presented showed 3 phrases: “3 Billion,” “$300M,” and “60.”

  • 3 billion is how many people are connected to the Internet, all potential customers for merchants.
  • $300 million is the cross-border opportunity. The estimates vary greatly, but, as Webster said, “even conservatively, $300 million is incremental volume for merchants,” an opportunity that they need to be more efficient in taking advantage of and optimizing.

Added Barbari: “There are many studies out there that peg that opportunity as more than $1.5, $1.6 trillion – those are really big numbers. I think, as a merchant, it’s important to recognize that, while the market is exceptionally large, dialing into that addressable market for yourself is a really good way of making sure that you look more carefully and closely at the opportunity ahead of you.”

  • 60 is the average score for merchants that were assessed by the index, on a scale of 100.

While Webster and Barbari agreed that a score of 60, on its face, is “nothing to write home about,” Barbari framed it as an opportunity for merchants to learn about their strengths and weaknesses. Most notably, the information derived from the study helps to specifically identify drivers of outcomes that merchants are interested in, such as sales, revenues, and chargeback rates – which are not always actionable in and of themselves.



Referencing a slide featuring some specific lowlights from the study (such as a Netherlands apparel shop that required a customer’s date of birth in order to make a purchase), Webster showed the multiple dimensions of friction for a customer, noting that “the door slams shut when little things become big things.”

As for a general potential solution, Barbari discussed the importance of providing options to consumers. Central to that tactic is transparency, which is a major asset to consumers. Merchants should never pretend to offer something that they actually do not; as Barbari stated plainly: “If you don’t offer it, don’t offer it.”



Webster explained that what drove the collaborative effort was a frustration borne out of not knowing how to quantify and provide a benchmark for merchants. She presented another slide that listed the three primary assets the index provides:

  • Understand cross-border customer paint points
  • Benchmark against merchant segment
  • Establishing best practices

Benchmarking goes back to drivers, noted Barbari. “If you shop your own experience, shop your competitor’s, understand the length of time it takes from homepage to checkout,” you can see it through the consumer’s eyes – which is essential.



In discussing the rigorous process that went into creating the index, Webster shared the fact that the 22 “Friction Elements” (including Payment Methods, Fraud, Developer Access, Risk & Compliance) they ended up with were whittled down from around 70.

Analysts on four continents were tasked to shop 160 websites – spanning 10 countries and 9 merchant categories – to get a sense of the shopper experience and document what it was like to be a consumer on the sites.

In selecting the sites, Webster explained, one element was assumed: If a merchant supported more than one language, more than one currency, and offered to ship to more than one country, it was categorized for the purposes of the index as being “in the cross-border commerce business.”

Barbari remarked that such an approach was logical, noting that “merchants need to remember that when you’re selling online, you’re exposed to the world.”

While the study did exclude key merchants’ sites that were truly not trying to be a global experience, it is important for merchants to remember that any site can be accessed by anybody around the world; this, said Barbari, “represents both a challenge and an opportunity.”

The opportunity is that you’ve opened your world up to a much wider audience, while the challenge is the friction points you have to overcome in order to service it.

And “it’s not always substantial, radical, wholesale changes that are necessary,” added Barbari. Little changes, like address fields that are appropriate for country, can make “a world of difference.”



Presenting a slide that looked beyond the average score of 60, Webster shared the facts that “type A” merchants – those that are the most optimized – scored as a high as 94, while the least optimized merchants posted scores as low as 20.

Remarked Barbari, “That’s a really significant swing.”

For merchants, he said, it’s important to make the distinction to know “where you want to play.” That’s not to say that the least cross-border-optimized site is the best in that regard, but if you’re a specialty retailer, and your market is narrower, “it’s not important that you’re least optimized, it’s important that you’re optimized for your market.”

Operating with this awareness, explained Barbari, prevents merchants from being “surprised by how your consumers are seeing [them].”



The study determined that travel is the most optimized segment, while specialty retail is on the opposite end of the spectrum.

Looking at the success of travel, Webster observed that “‘think globally, act locally’ seems to be the mantra for optimizing cross-border experience.”

Barbari, for his part, was not surprised by what segment is the leader and which is the laggard. “There’s a lot to learn,” he said, “from how the more optimized e-travel sites are presenting themselves.”

Travel succeeds, he continued, because it is a “globally savvy” market. Consumers are not just traveling intra-country, but inter-country – and travel sites specifically cater to that market, offering multiple languages (52 percent of them offer six or more languages), globally accepted payment methods, and help.



In reviewing the most optimized travel sites, Webster and Barbari determined that providing a breadth of options in languages and currencies make the customer transaction comfortable as well as minimizing the number of steps that are necessary to complete it.

Barbari pointed out that many consumers have become accustomed to thinking that travel purchases – in particular, airfare – are “hurry-up” opportunities; in other words, the appearance of a low fare is an impetus to act immediately. Based upon this phenomenon, travel sites have done a good job in optimizing the “time to checkout.”

“When a consumer finds a deal, they’re excited to execute it,” said Barbari, adding that the “simple, smooth, shortest path to purchase is a fantastic way to go.”

Webster and Barbari agreed that what the most optimized travel sites are doing with regards to path to purchase stands as a good lesson for some of the sites that are lagging behind in cross-border optimization.



Referencing the slide showing where specialty sites are failing in cross-border optimization, Webster called it “an interesting lesson on a number of dimensions.”

Very few of the specialty sites that the index studied offer multiple languages, or multiple currencies, or functional help to customers. Webster floated the notion that perhaps some of these sites are actually optimized for a local market and just aren’t being transparent about that fact.

Said Barbari: “Transparency is going to make a big difference.”

Since the market for a lot of specialty categories – such as jewelry and pet products – tend to be local, for the merchants to be clear about that would make a big difference in their online performance.

Regardless of whether the market is global or local, explained Barbari, the aspect of help can always be improved. About 30 percent of the sites that were examined require a phone call or an email form if customers wanted help, which is a bad experience any way you slice it, and one that leads to customer loss.



Webster and Barbari found little surprise in the fact that the U.S. has high optimization score overall, with China in second place, just in front of the U.K.

On the other hand, Mexico, Webster noted, is “struggling in a lot of dimensions.”

While acknowledging the “nice race around second place” (between China and the U.K.), what Barbari found interesting is the different friction points within each specific experience.

The U.S. and the U.K. being “tied” in the category of number of global payment methods supported, he said, shows two mature markets recognizing the importance of that element.

“Where it starts to trail off,” noted Barbari, “is in languages.”

94 percent of the sites that were examined offer more than one language, proving that the need is recognized by almost everyone (Mexico is an exception, with 60 percent of its sites only offering a Spanish-language option).

Barbari also observed that some of the sites “in the middle of the pack” are doing certain things really well. France, for example, on average offers 11-plus languages, showing that the country caters to the global traveler.



Webster was surprised to learn that many sites in Brazil require a Brazilian national ID in order to complete purchase, which certainly knocks down the possibility of international customers.

Stated Barbari, “the process of doing business in Brazil is complex.” There are a lot of rules and regulations in place, as well as compliance points for merchants, that make the nation particularly difficult to service from regions beyond it.

As a result, a lot of eCommerce sites in Brazil remain focused on catering to in-country consumers, and little effort has been made to reach outbound – to the U.S. or anywhere else.



Webster and Barbari unpacked the five things that every merchant needs to do to optimize the cross-border experience for their customers:

  • “Speak the language” (accommodate the customer’s language)
  • “Do the math” (allow for currency conversion)
  • “Play the global card game” (accept major payment methods)
  • “Keep help alive” (make help available to the customers at all times)
  • “Slim down checkout” (make it as quick and easy as possible)

As Webster observed, “it’s a pretty good to-do list.”

Barbari agreed, and offered the method of thinking about it in the context of physical experience, when traveling internationally and going into retail stores. All of the points in question apply; if they’re not in place, the customer is likely to leave.

If anything, said Barbari, the lack of any of the elements in the online environment is actually more likely to drive customers away, because they’re often attempting to conduct their transactions on mobile devices that are difficult to navigate.


Barbari stated that it is “imperative” for sites to include the local language. Beyond that, “the six or more cutoff” (the 10 sites examined offered a minimum of six language options) is “pretty logical,” as the Top 6 represent about 30-plus percent of languages spoken worldwide.

Webster added that multiple-language inclusion “has to go beyond the homepage” in order to be useful.


Barbari observed that for an eCommerce site to not maintain price accurately through the transaction process – or allow a situation where customer who made a purchase later finds an overcharge on his or her statement, resulting in a chargeback – is a “terrible outcome.”

It’s tough to prevent on back end, but much easier to do so on the front end.

“Doing the math is not just about converting to the local currency,” stated Barbari. It’s about helping to ensure that the consumer has a full understanding of all of the charges involved (taxes, cross-border fees, fully-landed cost, et al).

Payment methods

The most optimized sites allow payment by Visa, MasterCard, American Express, Diners Club and PayPal.

As Barbari said, this is “a great place to start…[but] more is not necessarily always better.”

He recommended that merchants “take it to the local level” by offering different currencies and favored payment types across different countries and regions. To offer the maximum amount of payment method options in every situation can be confusing and overwhelming to the customer.

Describing examples of how certain payment methods perform better in specific regions than in others, Barbari admonished that “it’s important to know your market.”

Additionally, it’s important that accepted payment methods be made clear to the customer at the very beginning of the online shopping experience.


What’s important, noted Webster, is not only how help is made available to consumer, but when, because the “cross-border environment is a 24-hour cycle.”

Agreeing that global eCommerce is a 24/7 environment, Barbari said that there’s no excuse for a merchant not to make help available at anytime, to any location.

“That doesn’t mean you have to staff a 24/7 call center,” he added. Rather, adding simple things to a site like sizing charts and chat environment can improve conversion rates.


Slimming down the checkout, Webster notes, is an improvement that can apply to all commerce, not just cross-border. “When currency, language [and other elements] are introduced, that creates friction in and of itself;” to then add “multiple pages” for the consumer on her way out the door is an additional problem.

She said she was “stunned” to discover that, on some of the worst performing sites, it took 17 clicks to complete the checkout process.

By contrast, Barbari points out that some of the previously discussed travel sites cut that in half.

He drew an analogy to football, specifically to the fact that teams that do better in the red zone (the 20-yard span closest to the end zone) win more frequently. For global eCommerce sites, the checkout process is the red zone.

“Anybody with a storefront can compete. But not everybody is competing to win,” said Barbari. “And this is truly a game about winning your consumers – not just one time, but making the experience really comfortable for them so they’re coming back time and time again.”

There are very simple fixes to improving the critical checkout process, as Webster pointed out, such as including a one-click option to duplicate the billing address as the shipping address.



In the final slide, Webster and Barbari reviewed the key points from the webinar:

  • Cross-border is a large and growing opportunity
  • To take advantage, act locally and think globally, always be on, and streamline

Barbari additionally offered the value, when observing the detailed results in the index, of looking at what is working (and what is not) in individual segments, rather than just focusing on the aggregate score.



Webster revealed that she had held a listener-submitted question until the very end, because it dealt with an interesting segment that she and Barbari actually hadn’t thought about when initially selecting their merchants for the study:

What about restaurants and QSR sites as cross-border segments?

Barbari commented that, off the top of his head, restaurant sites tend to cater to local environments – but not all of the time. That’s where chain restaurants and specialty restaurants can come into play.

Looking ahead to the next index (PYMNTS and Digital River will be releasing one every quarter this year), he concluded that “it might be an interesting segment to explore.”


To download the full X-Border Payments Optimization Index, click here.

To download the full webinar, click here.



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