Why it’s a great time for UK sellers to expand into the US market
With Brexit and increased shipping costs causing headaches for UK businesses selling into Europe, the US is becoming an increasingly attractive destination for expansion.
We sat down (virtually) with Infinity Blue CEO, Al Baker and US MD, Charles Kochel, to discuss the key questions, challenges and opportunities when it comes to selling via e-commerce platforms such as Amazon stateside…
What’s the market size in the US?
Al: “Roughly six times bigger than the UK market, the US is quite literally bursting with opportunity – and plenty more product niches. The challenge here can be finding the right keywords and categories for your products. We work with lots of our UK partners using tools like Helium 10 to home in on search trends to optimise their performance.”
Charles: “Yeah – it’s important to remember that although both our countries speak English, it’s not an exact match. Say if you’re selling hangers for trousers in the UK, you have to remember that in the US, customers want to hang up their pants. We also use imperial measurements too – so you’ll want inches instead of centimetres if you need to supply dimensions for your product and so on.”
Al: “I’m sure you’ll agree Charles, it’s key to get involved in the big US shopping holidays too!”
Charles: “100%. There is a huge appetite for things like Prime Day and Black Friday in the US. Start planning well ahead of time for events in terms of stock levels and promotions, and be prepared to spend more on PPC bids too, as competition for sales will be turbocharged.”
Are the tools different to the UK and EU platforms?
Charles: “Basically, if you’re using Amazon as your platform of choice, by selling in the US, you’ll get to try the latest beta tools first. Amazon uses the US market as a testing bed for their latest platform additions. For example, you can now send customer engagement emails and publish posts, helping you drive greater brand awareness and traffic.”
Al: “If I’m right Charles, another feature recently launched is enhanced brand analytics data, which includes a new dashboard containing insight into which keywords your products are converting on, and your position compared to competition. Being first to try these tools out offers you a head start before they’re rolled out to other parts of the world, giving you the edge over other UK and EU sellers when they finally do launch.”
Is it possible to sell cross-border to neighbouring countries?
Charles: “Registering for Amazon in the USA makes it much easier for you to also sell to our neighbours, Canada and Mexico thanks to Amazon’s Remote Fulfilment programme. Essentially, it’s a lower barrier to entry that you might experience in other markets and nations. Done well, it can open up opportunities to serve thousands more customers, but again – proper planning and market research is needed to be successful, all of which we support our clients with.”
Al: “Yes, and another Amazon-shaped bonus is their offer of discounted referral fees for driving sales from other sources. So, if you sell domestically in the UK and are unable to send individual orders to non-Amazon customers in the US, you can use Amazon attribution to drive traffic to your listing from outside the platform to your product.”
What are shipping times like? Can they cause a headache?
Charles: “It’s probably no surprise that it takes a while for stock to arrive Stateside from the UK but then you need to take into account that the US is vast. Once your stock lands in this country, its journey isn’t over. If you’re using Amazon’s FBA fulfilment service, it’s good to know that they take your stock and spread it around various FBA sites across the country. It’s great once it’s all in place because it means it will reach customers quickly, but while this process happens it could be several weeks before the delivery estimate on your product reduces – meaning the likelihood of making a sale is lower.”
Al: “We always suggest to our clients to send product over in bulk – there’s no point having only one or two items in stock or you’ll find yourself trapped in the cycle of a shipping waiting game. Be prepared for an initially low conversion rate.”
Is it easy to process returns for customers in the US?
Al: “Recovering returned items is expensive if you’re a UK business selling in the US. If you have products with a high return rate or which are easily damaged in transit, it’s best to focus your attention on other SKUs. Start with a few best-sellers with low return rates, rather than stocking your whole catalogue in one go.”
Charles: “Also if you’re using FBA, you don’t want items sitting on shelves for long because otherwise you’ll start incurring storage charges. We can help you identify the right products from your selection to take to the US market.”
Are there any laws it’s worth being aware of?
Al: “Selling in the UK generally means following one set of laws, same if you take your products over into the EU. However, with the US, it’s all a little more complicated. There’s federal law which applies to the whole country, but then states can also make their own laws – and you need to make sure your products comply.”
Charles: “A good example of this is California’s minimum efficiency standards for all electrical goods. With a population of around 40 million, this state is the most populated in North America, so you don’t want to be missing out on such a big chunk of the US market. If you’re selling food items, you also need to be particularly careful with labelling and ingredients.”
Al: “Yes – due diligence and supplying the right paperwork is vital!”
At Infinity Blue, our regional experts work with you to help take your brand from strength to strength in global markets. If you’re considering expanding into the US, speak to us today to find out how we can help you succeed.
