Cross-Border E-commerce: A Trillion-Dollar Opportunity You Can’t Miss

Technology 2 months ago

Cross-border trade is the next big thing in the e-commerce space. You won’t want to be late to the party.

How so?

Characterized by increased information transparency, deepening technological penetration and sophisticated global supply chains, the world today is perfect for fostering cross-border trades.

Consumers buy from abroad when domestic offerings can’t satisfy their needs or wants. Businesses expand internationally when they’ve reached growth limits in their home markets.

If you work at an e-commerce company, and are hoping to learn more about cross-border e-commerce, you’re at the right place.

This article explores the topic of cross-border e-commerce from an analytical perspective, covering what it is, why it’s important, reasons for shoppers to make cross-border purchases, as well as tactics for monetizing the trillion-dollar opportunity. Let’s get started!

What is cross-border e-commerce?
Why should you care about cross-border e-commerce?
Top reasons for cross-border shopping & winning tactics
Some last words

What is cross-border e-commerce?

Cross-border e-commerce refers to the process of providing goods or services to customers worldwide. As sellers and buyers are located in different geographies, sales are often conducted via an online store or platform.

Broadly speaking, there are three types of cross-border e-commerce transactions: business-to-consumer (B2C), business-to-business (B2B) and consumer-to-consumer (C2C).

As its name suggests, B2C e-commerce refers to the supply of goods or services by online retailers or brands to consumers. B2B transactions are trades between business entities, whereas C2C involves individual consumers providing goods or services to other consumers.

Why should you care about cross-border e-commerce?

Cross-border e-commerce is an enormous market, and it’s growing at an unprecedented rate.

A report by McKinsey & Company projected that the total value of merchandise traded across borders will jump by some 67%, reaching $500 billion by 2025.

Still not convincing enough? The figure is forecasted to hit a whopping $2 trillion by 2030, meaning that cross-border e-commerce could be a trillion-dollar opportunity.

For domestic brands that aspire to grow and scale their businesses, or are facing growth bottlenecks due to limited local market sizes, cross-border e-commerce has presented itself as a solution to fulfill their ambitions or address their greatest pain points.