Confidential

For customers looking to expand their business overseas

4 June 2015

Agenda

– Setting the scene

– The journey to success

• Defining your overseas

ecommerce strategy

• Speaking your customer’s

language

• Understanding international

payment preferences

• Building an international

payments solution

• Looking to the future and

case study

– Summary

– Q&A

The internet never sleeps

You’re ‘always on’, all over the world, and people are looking at you…

New customers Competitors Press and media Investors Suppliers

Confidence is returning to UK businesses…

“Below the radar, growth in Europe

starts swelling UK company profits.”

(Reuters, Feb 2015)

“Businesses are exporting more, in

particular to the Asia-Pacific region,

but they now also feel more bullish

about exporting to Europe since its

exit from recession.”

(BBC)

Exports to the USA in January up

23% vs same time in 2014.

(ONS, 2015)

Number of visits abroad by UK

residents up 4% in 2014, spending

nearly £36bn.

(gov.uk)

The opportunity for ecommerce is even more encouraging.

The global cross-border ecommerce industry was worth USD$105bn in 2014,

and is expected to grow to USD$307bn by 2018.

But we’re not quite there yet

Barriers to overseas buying Consumer Business

Businesses and consumers share many of the same concerns.

Companies who can overcome these can achieve a competitive advantage.

Unreliable and lengthy transit times

Customs bottlenecks

Price opacity

Complex and ambiguous return processes

Limited transparency and flexibility of delivery

(Boston Consulting Group, Sept 2014)

Note: Total retail and online retail sales does not include categories such as travel, cars and prescription drugs. It also does not include food and drink sales at a restaurant or fast-food chain, consumer-to-consumer

commerce, or gasoline sales.

Source: Forrester Research Online Retail Forecast, 2013 to 2018 (Western Europe).

Online retail sales as a percentage of total retail sales by country

So what’s driving this?

UK

12%

2013

15%

2018

France

6%

2013

10%

2018

Spain

2%

2013

5%

2018

Sweden

4%

2013

6%

2018

Netherlands

6%

2013

8%

2018

Germany

7%

2013

10%

2018

Italy

2%

2013

4%

2018

Key question no. 1 – Do we know enough about our new target market(s)?

taxation duties technology

culture visibility

regulation legal payments

currencies brand

banking

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

Key question no. 1 – Do we know enough about our new target market(s)?

Can you also:

• speak to your customers, when and how they want?

• provide customer services and product support?

• cross or upsell?

• renew and retain?

• be legal, compliant, on-brand and culturally sensitive?

• talk to non-customer audiences?

• integrate with the rest of your business systems?

It’s not just about sales over the web

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

Market

and sell

Support

and serve

Purchase Recommend

Ma

inta

in

Se

lec

t

Research Use

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

70% of the world doesn’t

speak English and every year

the percentage of web traffic

viewed in English drops.

In 2013 over 50% of queries

on Google were submitted in

languages other than

English.

As economic migration

grows, foreign language

customers may even be

in your own country.

If this worries you, you’re

not alone…

60% of companies admit

to having no international

content marketing strategy.

(Content Marketing World, 2013)

Key question no. 2 – How prepared is the rest of our business to operate in multiple languages?

Effectiveness/

agility

Complexity/

cost

Single language

communications

Outsourced

language

services

In-house

language

services

Automated translation tools should never be

used without being checked by a real person.

Marketing

& comms IT

Regulatory Finance

Sales

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

Key question no. 2 – How prepared is the rest of our business to operate in multiple languages?

Settling vs holding considerations

• Cashflow

• Internal currency requirements

• Costs of settling

• Banking

• Returns and refunds

• FX fluctuations

• Minimising fraud

Key question no. 3 – What do we do with the revenue we generate?

Did you know?

of online shoppers abandoned their

purchase when their preferred

payment method was not offered.

59 %1

1Source: Frenchweb.fr – May, 2014.

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

Key question no. 4 – What do we need to do to make this happen?

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

Financial Technical Cultural

Different countries have different

perspectives on security.

What are the purchase habits?

When/what/how?

Is your target market comfortable

with buying from overseas?

Be device agnostic.

Can you reskin or add layers for

languages, brands or currencies?

Are you showing local prices at

catalogue or basket stage?

Is your site resilient 24/7?

What’s the risk profile of each

currency?

What are the fraud characteristics?

How do you protect yourself

against FX fluctuation?

Should you start simple and grow

over time?

Building an international gateway and acquiring solution

At its core, a fit for purpose international gateway is about one thing –

improving conversion.

To succeed, it’s not just about collecting payments. You need to understand

the technical, financial and cultural subtleties of your overseas target market.

Where should you focus?

• Website optimisation

• Future payment methods

• Geo-targeted content

• Mobile first

• Big data, insight and analytics

Key question no. 5 – What is our strategy for the future?

1Source: Barclaycard statistics, 2014.

2013 rise to

10% 1

2011

1% 1

2017 forecast

25% retail ecommerce

on tablets

1

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

CustomWeb case study

Switzerland Domestic strategy

Expansion UK Expansion into UK market due to

interesting opportunities

Mobile first Mobile optimisation of content

and information

Phase 2

Expansion to UK/US

Phase 3

Optimisation/outlook

Phase 1

Domestic strategy

Expansion Benelux Added market specific payment

methods and translations

Outlook Wallets?

Market specific optimisation

of content and processes

2012 2013 2014 2015

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

CustomWeb case study

Switzerland Domestic strategy

Market pull Expansion strategy into new

markets UK (market pull)

2012 2013

Domestic strategy:

• Languages: DE/FR

• Payment methods: Visa/MasterCard/PostFinance Debit Card/PayPal

• Currencies: CHF

Business plan/expansion strategy:

• Languages

• Currencies and settlement

• VAT

• Consumer law and regulations > specialty digital goods

• Time zones: hours of customer services

Phase 1

Domestic strategy

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

CustomWeb case study

Expansion UK/US Card countries: credit

card as preferred

payment methods

Phase 2

Implementation

Expansion Benelux AT/DE Alternative payment methods:

invoice, PayPal, ELV etc.

2014

Expansion UK/US:

• English support desk

• Refund policy (market push)

• Deactivation 3-D Secure (Fraud)

• Currencies: reduced to CHF and EUR fixed FX-rates

(due to administrative overhead)

Expansion Benelux/AT/DE:

• Translations/language support

• New payment methods

(regulatory hurdles and collecting fees)

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

CustomWeb case study

Phase 3

Outlook

Outlook Customer specific content

Process and content optimisation

2015

Outlook:

• New checkout experience (wallets: MasterPass)

• Mobile optimisation (tokenisation)

• New payment methods (Bitcoin)

• Target-specific content (landing pages, A/B testing)

Defining

your overseas

ecommerce

strategy

Speaking your

customer’s

language

Understanding

international

payment

preferences

Building an

international

payments

solution

Looking to

the future

To summarise

What does the full user experience look like?

An overseas

sale has become

the norm

Content and prices

that your customer

can understand

Customer recognises

and trusts your

payment methods

You collect, hold and

make best use of the

currencies you collect

Your customer

comes back

What do we need to take back to our business?

• Do we know

enough about

our new target

market(s)?

• How prepared is

the rest of our

business to

operate in multiple

languages?

• What do we do

with the revenue

we generate?

• What is our

strategy for

the future?

• What do we

need to do to

make all this

happen?

Are you seeing an increased demand for mobile

ready websites and apps? Yes, an ever increasing number of enquiries, requests

and implementations. Businesses need to consider

having their website and payment page optimised to

support mobile devices. We are seeing an increasing

demand from businesses to develop a mobile

application presence.

What stage do you start offering local, domestic

websites? Translation of your web presence to meet local and

cultural demand will be costly. We see a number of our

clients translating certain web pages into the language

of the target markets when initially starting to penetrate

a new market. It is worth considering booking your

localised domain name as early as possible.

What are main non-card payment methods

across the EU that should be considered? This is a key area based on detailed research from

companies operating overseas. It is important that

you achieve the ‘right’ payment options coverage. As

an example, if the Netherlands is your target market,

you must offer iDeal. In Germany, you would

seriously need to consider SEPA Direct Debit, plus

Sofort and Giropay.

What do you think about the popularity of

eWallets internationally as an alternative payment

method such as PayPal, Skrill etc? Are they

known overseas and worth it? Yes they are known overseas and they are

increasingly popular, particularly in countries such as

Germany as they allow customers to add a funding

service that is not a credit card. You need to be

mindful that wallet acceptance is relevant to the

country and the consumers that you are targeting.

There is a place for them particularly for specific

sectors and consumer audiences.

There’s a lot in the press at the moment about UK

businesses spending over £2bn per year on

processing payments collected overseas. What tips

would you give them to help reduce those costs? Ensure that you are offering the relevant currencies and

payment types to the markets that you are targeting.

Businesses should consider whether they are settling

funds into multiple currency bank accounts or

minimising their banking exposure to their primary

trading currencies. Businesses also need to be mindful

of the varying interchange rates globally. A card issued

by a Bank outside of the EU will attract considerably

more cost than one issued within the EU.

Help is out there

• UK Government Trade

and Investment

• Ecommerce Europe

• Econsultancy

• Our team

Steve Clay

Head of International

New Business

Barclaycard

Steve.clay@barclaycard.co.uk

www.barclaycard.co.uk/business