The Oban Blog

3 Take-outs from Retail Week International Expansion 2016

There has been much to think about and reflect on after attending Retail Week’ excellent International Expansion event this week, and a really top-notch selection of speakers and delegates. Brexit loomed large during many on stage and coffee break conversations, with consensus that the only certainty is uncertainty! That said, many attendees felt that rest of world now presented a potentially more attractive (less unstable?) option to consider, excluding obvious ‘tricky’ markets like Brazil, Nigeria. So, geo-politics aside, what else was consistently discussed?

#1 How do we decide where to land?

It was evident that retailers and e-tailers have varying degrees of sophistication when reviewing market attractiveness and entry strategies. Best if I remain brand anonymous here, but well-known brand X presented very sophisticated market attractiveness and trade partner attractiveness models, (including dimensions and metrics to map competitive dynamics, tax efficiencies, legislative forces, location planning etc. etc.) whereas equally well-known brand Y admitted that ‘flag in map’ had been their approach to date, and that more science was required to make better decisions.

All the speakers agreed that online can play a key role in low risk market entry and data gathering, especially in markets like China where market places such as Tmall Global are an increasingly attractive proposition. So much so, that two key brands admitted that they are very unlikely to create an owned website in China, preferring to work via third parties.

#2 Social media plays a key role in developing markets – but is tricky to manage…

An APAC focused theme, but with relevance to the rest of the world, the discussions kicked off with data across the board clarifying that 60%+ sales now via mobile devices. So far so obvious, but speakers from brands and platforms were pointing out that….

• APAC consumers engage 5+ times online before purchasing
• Majority of touchpoints are social / chat interactions, with younger consumers keen to gain peer views on fashion purchases before hitting the buy button
• In-market celebrities play a massive role, and endorsements / sponsorships are seen as a great way to build brand affinity
• Social authenticity is very important, so attempts to engage locally are best managed via in-market presence, with excellent audience and trend insights

Can offline play a role? Absolutely, but so much interaction is online and mobile, and this trend is only going one way.

#3 In-market platforms have global ambitions

Did you know that Katy Perry is now the global brand ambassador for Alibaba? This a clear signal of Alibaba’s future ambition. The Chinese platform has built a tremendous end to end retail infrastructure, including d2c, b2c, c2c, payment, logistics, and already actively caters for ROW shopping. Baidu is already operating in non APAC countries such as Brazil and Line’s core four markets is also set to expand. So keep eyes on these platforms, they are likely to be coming to a country near you, and soon.

Again, a great event, thought provoking content, and already looking forward to the 2017 edition.