Jorij Abraham, Managing Director at Ecommerce Foundation, highlights the importance of a global trustmark for cross-border ecommerce
This editorial was first published in December 2019, in our Cross-Border Payments and Commerce Report 2019 – 2020, which provides a comprehensive overview the major trends driving growth in cross-border payments, cross-border commerce, and marketplaces.
The rise of ecommerce is continuing to grow at a rapid pace. The total transaction value of ecommerce worldwide is estimated to be USD 3,391,727 million in 2019 (+ 10.7% compared to 2018). This is matched by an impressive number of online shoppers (3,756 million estimated users, almost 40% of the worldwide population). The US and China represent the biggest markets globally (when it comes to their online spending) whilst countries such as Argentina, India, and Japan have an impressively high growth rate.
However, whilst these figures are striking, there are still barriers to the wider adoption of ecommerce. One of the most prominent factors is trust in the online store. Whilst the level of cross-border ecommerce is on the rise, there is still the tendency to stick to your own nation’s online stores or within a small radius. The following figure demonstrates the level of consumer confidence within the EU when shoppers buy online from a domestic store and cross-border.
Barriers for consumers when buying online
Reduced consumer protection: consumers generally state that they do not know their rights in the global marketplace. However, they do understand their rights within their own country/region and feel uncertainty when purchasing from further abroad.
Concerns about delivery: convenience is a key driver for ecommerce. This is also extending to delivery where consumers are wanting more efficient and cheap (preferably free!) options. So what happens when the delivery firm can’t be contacted easily or only in a different language? Perhaps after finding the perfect item, the delivery takes up to three weeks.
Dispute resolution: no one likes having a problem with their purchase, whether that be online or in-store. And when there is a problem, consumers expect a clear way to its solution. Legislation is catching up in this area with examples such as the EU’s system. Without the certainty of having the problem solved and a lack of easy to understand information about this, consumers will shy away from cross-border ecommerce.
Types of online trust
Trust is a very open term, and it can extend to many aspects of the ‘customer journey’. When a consumer has decided to make a purchase, factors such as the transparency of the purchase process can play an important role. Below there are two examples of the types of trust when dealing with online transactions:
Privacy and security: 22% of consumers never shop online as they distrust the internet. A consumer’s personal information is important to them, and there is still a perception amongst certain consumers that online companies can be careless with their data.
Trust and the language barrier: developed markets such as the US, UK and China exhibit a stronger preference for global stores or those in their own language. The latest research from PayPal highlights the global differences in ecommerce when it comes to language. When looking at those who don’t feel comfortable with making purchases on a foreign website in a non-native language, the results are interesting. Consumers from English speaking countries such as the US, Canada, Australia, and the UK agree with this sentiment the most, alongside other countries such as Russia and South Africa.
A Global Trustmark: an independent way to increase trust in ecommerce
One way to increase the trust that consumers have when purchasing online is a global trustmark, such as Safe.Shop. The graph below demonstrates this clearly. In this case, consumers were asked:
As the graph shows, 70% of consumers felt that this would have a positive impact on their trust for an online store.
A global trustmark provides a visual indication that not only has a third-party verified the online store, but that the store itself has gone through the effort to make a top priority gaining the confidence of potential consumers. A vzbv report stated that 76% are more likely to choose a website with a trustmark.
In terms of a direct and easy-to-implement strategy, displaying a trustmark is one of the top choices for ecommerce businesses. A trustmark is great for small/medium-sized online shops as well as for those expecting new shoppers, or when shopping cross-border. This is because a trustmark can act as a substitute for certain consumer trust points, such as previous experience with the online shop. This is backed by another report stating that shoppers will be more receptive to trustmarks on an unfamiliar online store. This therefore suggests implementing a trustmark could be a great plan when targeting foreign markets.
Summing up
A consumer’s confidence and trust when shopping online plays a crucial role in their decision to buy. In order to drive growth (and therefore revenue) boosting this confidence is key. A crucial part of the puzzle in solving the trust issue is a trustmark. By putting forward a trusted third-party to verify an online shop, the trust barriers consumers encounter when shopping cross-border can be overcome.
About Jorij Abraham
Jorij Abraham is an ecommerce generalist with more than 15 years’ experience in integrating marketing, business processes and information technology to build online turnover. He is currently the Managing Director of Ecommerce Foundation, a global digital trading entity with the aim of fostering global digital trade.
About Ecommerce Foundation
Ecommerce Foundation is an independent organisation with the mission to facilitate ecommerce through the development of practical knowledge, market insights, and services.
About Safe.Shop
Safe.Shop is the Global Ecommerce Trustmark initiated by Ecommerce Foundation, helping online shops selling nationally and cross-border by creating consumer trust. Safe.Shop services include an ecommerce Global Code of Conduct certification, a Consumer Review System, and an automated Trust Score.
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