Get Paid: Multiple Channels Add Power to International Campaign
As the international marketplace becomes increasingly sophisticated, and international markets continue to grow both in strength and scope, U.S. marketers are rethinking their global strategies. While many companies have tested the international waters via one channel, such as the Internet, retail or direct mail, few have reached their full international growth potential using a single-oar approach.
When you rely on a mix of vehicles, you can strengthen response for each channel employed, especially when you include two or more of mail, periodicals, telemarketing, radio/television, package inserts, card decks, Internet or e-commerce. From years of experience in the domestic marketplace, we know that appropriate use of multiple channels can have a symbiotic effect on each of the channels used, e.g. direct response drives retail sales; direct mail drives customers to the Internet. The same is true around the world, but for international campaigns, there are a few extra tricks to maximizing sales while minimizing channel conflict. These include:
• Shipping and handling fees that recognize international fulfillment realities;
• A consistent approach to pricing and payment across channels; and
• Establishing the facilities required to respond promptly and thoroughly to customer complaints.
Shipping and Handling
There are a number of challenges associated with fulfilling international orders from the United States, including the high cost of delivery to foreign countries and the local customs and duty regulations in your destination markets. Whether you advertise via the Internet, mail or another channel, shipping and handling prices need to reflect the real cost of shipping to your recipient’s home country, while remaining reasonable for the customer.
You may choose to eliminate certain types of products from your international offering because unreasonably high duties payable by the customer upon delivery often result in costly returns.
One way to reduce costs and customs headaches in major markets is to outsource packing and shipping to a local company in your customer’s market.
Preferred Payment Methods
While check and credit card are important mail-order payment options in most countries, in every country the cultural attitude toward payment method often is different.
According to a 2000 Nua Internet survey of 460,000 Belgians on the Internet, 75 percent would not give their credit card number for online purchases. There are many would-be shoppers in the world who don’t want to purchase with credit, or who don’t feel safe giving their credit card details online to a merchant they have not met. You can expect these people to come shopping once other options, such as Internet bank transfer and direct debit, are widely available.
Companies selling to countries such as Germany, Austria, the Netherlands, Norway, Belgium and Japan need to be aware of important payment methods such as bank/giro transfer and direct debit. A bank/giro transfer is a form of payment in which the customer instructs his or her bank or post office to directly transfer a specified sum to the beneficiary’s or company’s bank or post-office account. The customer does not send payment directly to the company. This method is particularly relevant for payment on invoice, such as subscription renewals and catalog orders. If you are comfortable with invoicing for goods, the bank transfer payment option will be your most important payment option across several European markets.
The bank transfer payment method is an attractive alternative to credit card payment for Internet transactions in Germany, Holland, Belgium and most Scandinavian countries. This is not a real-time payment method, and can’t even be said to be online, because customers have to leave your site to access their Internet banking facility. It has the advantage of being less easily repudiated than credit card payments, however, and is relevant to a significant portion of the marketplace that do not carry credit cards.
Direct debit is a very important payment option for customers in Europe. Rather than enclosing a check with order, customers simply fill in an authorization to debit their bank account directly. This payment option generally can be used for mail order or e-commerce campaigns, and has the advantage of being easy to offer and clear. Direct debit files can be submitted to the banks for authorization in much the same way as batches of credit card information.
Clearing International Payments
It is important to clear international payments through the appropriate channels. It is not possible to process foreign currency credit card transactions through a U.S. merchant account without a currency conversion shown on the cardholder’s statement. This means the published price and the end price on the customer’s statement will not be the same, which could result in chargebacks. Similarly, it is not possible for companies to accept foreign, local-currency giro credits or originate local-currency direct debits using their U.S. facilities.
For companies that are heavily committed to a particular market and have offices and local staff to service that particular market, investing time and energy in developing a local banking infrastructure makes sense. In many countries banks will require local incorporation, security deposits and extensive information about a company before they will provide merchant accounts for card processing, direct debit or high-volume check clearance.
Alternatively, multicurrency payments can be cleared through an international payment processing company. This is a convenient option for companies testing new markets, new payment methods, or that are targeting several markets and want to maintain centralized control over payment receipts. International payment processing companies have access to a worldwide network of banking contacts for clearance of all major currencies and all popular forms of payment. They are able to establish foreign currency merchant accounts for card processing in their clients’ names.
Whatever channels and payment methods are employed, it is important to establish the facilities to respond quickly and thoroughly to customer queries and complaints. Early on in the sales process, provide mail, telephone and e-mail contact details to your customers so they can contact you easily.
Whether your company chooses to handle customer service in-house or to outsource, be sure to hire representatives who have strong written and spoken communication skills in the languages of your major markets.
Finally, have a strategy in place to deal with inevitable return and refund requests. Will customers return products to your company or to a local representative? How will they be refunded? Consistent treatment of customer queries and complaints greatly will contribute to repeat sales in each of your marketplaces.
Renée Frappier is marketing manager for PacNet Services Ltd., an international payment processing company based in Vancouver, Canada and Shannon, Ireland. She can be reached at firstname.lastname@example.org.