Why are most online shoppers American?

Ecommerce in the US: The Ultimate Guide

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USA: e-commerce superpower

If you the land of opportunity then what would be the first country that comes to mind? Most likely, your answer would be: the United States of America.

Despite new leadership and some recent political events that tend to spark social media responses and spark funny viral memes, the US has a history to be proud of.

It was many centuries ago when the idea of ​​the American dream was born. America has become the land of opportunity and a synonym for equal opportunity and success. The US is also known for its friendly and happy people: they are confident, enterprising, and freedom-loving.

America is also the land of opportunity and a superpower in the world of online sales. It has the largest economy in the world and is also the leading nation in e-commerce and cross-border exports and imports. It is also the birthplace of e-commerce giants like eBay and Amazon.

On the one hand, the US is a saturated marketplace whose growth may slow down in the years to come. On the other hand, US e-commerce sales are still leading the western world.

America's market size, purchasing power, advanced technology, and sheer love of online shopping make it an e-commerce hotspot for growth-minded online sellers.

US Market: General Characteristics

The US is the third largest country in the world and twice the size of the EU. It is one of the largest consumer markets in the world with a high level of internet usage. They are also leaders in developing the latest technological innovations.

Amazon is the dominant retail e-commerce platform in the US and all in all one of its top five digital objects.

America's power and strength lure many foreign companies to give in to the temptation to enter this market despite the expected high barriers to entry and strong competition.

US e-commerce in numbers

  • Population: 322.9 million
  • Active internet users: 282.1 million
  • Active social network users: 192 million
  • Active Mobile Social Users: 169 million
  • Internet usage rate: 87.9%
  • Retail e-commerce sales (2016): $ 322.17 billion
  • Projected Retail Ecommerce Revenue (2021): $ 485.27 billion
  • Number of e-shoppers (2016): 209.6 million
  • Projected number of e-shoppers (2021): 230.5 million
  • Digital retail growth: 15%

 

Behavior of online shoppers

The US is made up of savvy, internationally oriented consumerswho are very familiar with online shopping. US millennials (18-34 year olds) and women are most likely to shop digitally.

Customer satisfaction and the level of trust are relatively high in the USA, as are customer expectations. The US bears a lot in common with European marketplaces and European consumer behavior.

The strongest consumption takes place during the festive season. It is worth noting the days of the year when US retailers have great sales offers. These include, for example, Black Friday, Cyber ​​Monday and the holiday season. These are the times when you can sell a lot more than the rest of the year.

According to a survey by the Pew Research Center (2016), around 8 in 10 Americans are online shoppers. Approximately 1 in 10 adults in the United States shared their opinion about a product or company on social media. The customer experience and the importance of customer reviews should therefore not be underestimated.

 

A piece of advice for international online sellers looking to trade in America

It might seem like a given, but don't forget about cultural differences, especially when it comes to communication.

You may think: But that's obvious, we all know American culture!

Granted, we know movies, pop music, and other aspects of American culture. However, it does not mean that actual business interaction with Americans is something you are familiar or comfortable with. Many cultural subtleties can easily be overlooked, especially when it comes to day-to-day business communication and tone of voice.

Greater awareness of such cultural differences will help you adapt to any overseas market. In this way, you can increase your chances of business success not only in the USA but also in other countries.

Popular product categories

According to Statista, some of the top product categories purchased online by users in the US (as of June 2016, for both men and women) include:

  • Clothes / shoes
  • food
  • Beauty / personal care products.

Logistics, delivery and shipping

The US is a big country and has one high-performance rail network, motorway connections and an air dispatch system. Your well-developed logistics market has strategic centers with excellent location positioning.

The preferred shipping options in the US are UPS and FedEx. Smaller shops also use the US Postal Service.

Because American consumers tend to be more impatient than those in other countries, most US retailers are offering free and increasingly same-day delivery options. However, the US market is much larger geographically compared to the UK so next day delivery is not as commonplace as it is in the UK.

The vast majority of US consumers are more likely to make a purchase when free shipping is offered. More than half of consumers are more likely to buy products when they have the option of free returns and exchanges.

When it comes to shipping across borders, there are a few challenges that need to be considered. These relate to:

  • Security: The recent outbreaks of violence have made direct connections to Mexico and Texas more dangerous. In addition, vigilance towards the terrorist attacks has made the United States particularly vigilant in the case of the flow of goods.
  • Economy: The US recession had long-term effects on the labor market and production.
  • Regulations: These have to do with paperwork, legislation and import / trade restrictions. The restrictions affect a range of products, including medicines, cheese, alcohol, food, or explosives.

Recommendation from our expert for shipping

Here is the most important information you should provide:

  • Value in US $
  • Exact item description (NIKE red T-shirt size L instead of just clothing)
  • HTS code
  • Country of origin
  • Optional: the link to the product and the Incoterms.

Many companies offer delivery services to the United States. Keep in mind, however, that it can take an exceptionally long time to deliver through the USPS (US Postal Service). Therefore Adrien recommends companies that have daily and direct connections to local networks in another country.

Preferred payment options for US online buyers

According to a survey carried out by American Express (September 2016) cards the most popular payment method among US online shoppers. 73% of American adult online shoppers use credit cards and 62% use debit cards to make purchases.

59% often used online payments, such as saved payment cards, mobile payment apps. 53% mention paying with cash. American Express data relates to both online and offline purchases.

Interestingly, many are US consumers Multiple card holders, with almost five cards per adult.

Mobile commerce in the USA

According to Statista data, the mobile share of retail e-commerce sales in the US is 36% (compared to Criteo data: 40% of online purchases made from a mobile device). Even if the US is a little behind the UK (52%), which comes first, its position is still strong.

The importance of purchasing mobile devices can be seen in the graphics above. Hence, ensuring adequate mobile optimization and a great mobile buying experience is imperative for growth-oriented online sellers.

Cross-border purchasing

The US is one of the largest B2C cross-border e-commerce markets when it comes to exports and imports. The most intense B2C e-commerce trade between the US and the UK is the result of the common linguistic background. China is also a popular online shopping destination.

More than half of online sellers in the US sell to international online buyers, especially those located in Europe.

Source: Landmark Global

Benefits of Selling Your Products Online in the United States

First, America speaks English: the second language with the greatest reach in the world and the most popular online language. So it's no wonder that English-speaking marketplaces are the first choice after your own national market! This gives you access to millions of shoppers from the US and beyond.

The second benefit of selling your product in the US is related to the size and maturity of the market together. This leads to a very, very large number of online buyers. Other benefits include online savvy consumers, a well-developed infrastructure, and an advanced payment culture.

Third is the Technology takeover rapidly with the US population, giving online sellers a wide range of marketing and communication opportunities, such as: B. via social media or apps.

Finally look at you the strength of the USA as a country and the concept of the US e-commerce superpower. Many overseas companies just can't help but aim for the US and add it to your country portfolio. The market's sales potential and leading position appear to exceed the initial burden of barriers to entry.

Challenges for US E-Commerce

First: Entering the US market is perceived as a great challenge.

The competitive internal market, demographic change, constantly changing technology and high consumer expectations require additional effort.

Secondly: Taxes in the USA are an extremely complex subject with many different state and local sales taxes. Interestingly, some online retailers only show the VAT due once the buyer has reached the checkout. However, this step can be very risky as many consumers who see unexpected additional costs abandon the cart.

Third, when it comes to the US infrastructure the challenges relate to the size of the country, the different landscapes and the completely different population densities. Logistical challenges can particularly affect small and medium-sized retailers. You may not have adequate resources or you may not be able to compete without joining a larger sales organization. This can have a tremendous impact on your margins.

In a nutshell

Centuries ago, America made it possible for people of all origins to seek happiness in the newborn land that has become synonymous with opportunity, opportunity, and equality.

What about online sales? Is America a Promised Land Today? It is definitely a premier supplier and an e-commerce superpower with only one legitimate rival: China.

The US is a leader in cross-border e-commerce exports and imports. After all, the market offers many possibilities and sales opportunities, for example with seasonal events such as Black Friday or Cyber ​​Monday.

While it can be relatively difficult to get into the U.S. market and stay competitive once you're in, your efforts can multiply your revenues and bring you business success in a country with one of the strongest economies in the world.

As the saying goes, nothing is impossible in America.

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About the author

Karolina Kulach is an expert in content marketing and a non-fiction author specializing in global e-commerce and online sales trends. Trained in linguistics (MA) and business administration (BA Hons). A well-traveled person with international education & work experience in London, Scotland, Poland and Germany. In her spare time, she engages in creative content ideas, including fancy rhyming poems. Read more articles on Medium: https://medium.com/@karolinakulach/