Preparing your brand for international expansion requires specific strategies to address each new market. Jonathan Aeschlimann, co-founder of online retailer Divbrands, explains how his company simplified its focus on customer service and succeeded in the U.S.
There’s no universally accepted blueprint to plan an international expansion. Each scenario comes with its own challenges to consider. The right fit for one market and set of consumers may not necessarily be transferable to those with different demands, so understanding the nuances of customer experience in each new region is critical to expanding overseas.
Our company Divbrands, the creator of brands such as mynuve.com, based in Bratislava, Slovakia and Budapest, Hungary, was looking to grow beyond its European markets into the U.S.
But the early days of our American dream were far from plain sailing. We use a direct-to-consumer model; by selling to shoppers without the need for wholesalers and other intermediaries, it cuts out the “middle man”. But logistical issues and long delivery times hindered progress when we first entered the U.S. market in early 2020.
The right fit for one market and set of consumers may not necessarily be transferable to those with different demands.
Despite e-commerce increasing during the COVID-19 pandemic, we initially saw slow sales. But once business began to build through brand recognition, the main hurdle to clear was the delay in getting products to customers.
Managing customer expectations
Nearly three-quarters of mainstream consumers are more likely to buy from a brand that offers fast delivery, and 38% of consumers would not shop with an online merchant again after a negative delivery experience. Focusing on customer service can be critical in making your expansion a success.
We were initially taking up to three weeks to ship to U.S. customers. In a demanding market where shoppers are used to just one- or two-day shipping, we needed to rework logistics to better serve customers. We teamed up with Google Business Solutions (GBS) to develop a new strategy and gain clearer insights into how to grow the business on an international scale.
“We first met the GBS experts in February 2021. It was invaluable to find people who had successfully overcome challenges similar to the ones we were facing,” explains our second co-founder Lourenço Maciel.
Simplifying strategy: a two-part process
Restructuring allowed us to drastically cut delivery times. With the help of GBS, we partnered with Chinese logistics specialist JD.com.
For our brand, delivery depends on two key elements: processing time, between the order being made and the parcel leaving the warehouse in China; and shipping time, between the parcel leaving the warehouse and reaching the final customer in the U.S.
To improve processing, our teams established standard operational procedures — reviewing JD’s internal processes to determine specific time slots to transfer orders so they could eradicate wasted time. Furthermore, by improving data flow between systems, we were able to pass shipping information to JD in a simplified format.
To improve shipping, our teams downscaled to focus on products that offered the best value to customers — offering U.S. shoppers the items with the best shipping time-to-cost ratio. Combining these two steps allowed us to get orders to customers in three to seven days, cutting wait times by more than half.
It preserved the possibility of free shipping, too. For online-only retailers like Divbrands with no physical store, keeping additional fees to a minimum is a key component of keeping customers happy.
New-found logistical agility went hand-in-hand with providing improved customer service. We established a customer centre for the U.S., which allowed people to get in touch by email, phone or chat.
“The foundation of customer satisfaction is a high-quality product, great communication and, ideally, word-of-mouth recommendation too. You also need simple and fast customer support. If one of those things fails, our customers won’t be satisfied with us,” says our chief operating officer, Daniel Aksioutine.
Our new streamlined approach has seen customer satisfaction increase steadily over recent months. Between May and September 2021, the number of support tickets — questions or issues raised by customers — submitted after making a purchase fell by more than one quarter, with the number of complaints regarding long delivery times also dropping significantly.
Meanwhile, customers rating their experience with Divbrands as “great” rose from 62% to 73%. And the U.S. share of Divbrands’ total sales nearly doubled in those five months, from 15.5% to 30%.
We recovered from a rocky start by prioritising what was most important to customers. Focusing on simpler strategies and key partnerships means brands can be better equipped to drive sales overseas while offering a high-quality customer experience.