Tips and Insights to Help Business Leaders Expand into New Markets in Today’s Fast-Changing eCommerce Environment
Covid-19 marked a digital turning point. During the pandemic, consumers were forced to buy nearly everything online; e-Commerce surged and organisations raced to make more goods and services available online. Some experts even predicted e-commerce would completely replace brick-and-mortar stores.
Fast forward to 2022: e-Commerce continues to evolve. Physical stores have reopened and emerged as a powerful tool for engagement. Retailers now have excess inventory they are looking to liquidate. Amidst a recession, consumers are looking for more bargains and deals.
As these market shifts occur, brands are adjusting their sales and marketing strategies. Partnership marketing has emerged as a key focus for organisations looking to grow their business. But there are clear differences in adoption and approach across geographies. Understanding these variations can help brands make better, more informed decisions as they lean into partnership marketing to expand into new markets and find new customers.
How Brands are Leveraging Partnership Marketing in Different Markets
Partnership marketing, refers to any outcome-based marketing partnership that can be scaled via digital technology. What sets it apart from paid search and other sorts of “traditional” online marketing and advertising is the use of partners, affiliates, and influencers who are compensated based on performance. The transparency of the performance model, the variety of partners, and the ability to expand globally are attributes of the channel’s success.
While the fundamentals of partnership marketing are similar across the globe, there is no one-size-fits-all approach. The execution and make-up of partner types vary from country to country. Because the maturity of the partnership marketing channel often correlates with the maturity of e-commerce in each country, there is value in understanding key differences in various countries.
Consumer behaviour differs between markets. For example, many countries in Southeast Asia “skipped” the time of the web and are mobile-first. The result is that a lot of partnership activity is via mobile and social media channels such as WeChat.
Meanwhile, in the US, a survey found 51 percent of American shoppers plan to use online voucher sites or browser extensions to help them shop this holiday. Another study showed almost two-thirds of consumers plan to shop in person this year to see products physically and avoid shipping costs and delays. With this transition back to brick-and-mortar, card-linked offers (CLOs) are gaining popularity. The approach involves rewarding consumers, often in the form of cashback or points, for making purchases at a specific retailer using a participating credit or debit card.
Click-and-Collect is also projected to grow by over 19 percent this year. Brands can offer a reward or voucher to encourage a consumer to pick up in-store. The opportunity to not only incentivise traffic in-store but to increase the margin by not paying for “free shipping” is a great example of shifting partner types to align with consumer behaviour.
New payment trends are emerging. Partnership marketing technology platforms offer payment in various currencies. Cash is king in most countries, resulting in a unique approach to e-commerce and partnership marketing which differs from countries where credit card and online payments are the norms. However, in Japan and wider APAC an increasing number of influencers are now looking for payment in the form of cryptocurrency. How long will it take before the US and Europe follow suit? Will things like invoicing and 30-day payment terms cease to exist with the shift to instant payments?
Scenarios as Tools for Strategy Development
There are many considerations for deciding if, when, and how to expand into new markets using partnership marketing. Trend analysis can be a powerful tool for future planning. However, there must also be a framework to help guide decision-making and ensure success. Following are key steps and common pitfalls to help begin the process.
Step 1: Research and Reflect
To start, brands should be clear on why they want to expand and their business objectives. For example, is it to acquire new customers, build your brand in a new market, or support existing marketing activities?
Then think critically: Do you know the market? Are your expectations feasible? How long will it take, and what investment will be needed?
Refrain from assuming your programme will act the same as another market. Needs differ in terms of consumer behaviour, size, and e-commerce maturity. No market will likely have the same results, so carefully manage your expectations for achievement and success metrics.
Step 2: Rally Your People
Understand that managing a market from the outside runs the risk of failing to fully understand the market and not being able to build the connections required to succeed.
Business leaders should consider the following: Does your team understand the market differences in the area you want to expand? Do they have the knowledge and skills to support those differences? For example, you may need language support or a certain technology platform to thrive in specific markets.
In most cases, it behooves brands to hire a specialised partnership marketing agency to support all the moving parts and help manage complexities.
Step 3: Watch Your Step!
There are some pitfalls to be aware of when expanding your partnership marketing programme globally. One of the most common mistakes brands make is underestimating cultural differences. People have different ways of working and communicating. Ensure you understand this when working with your local teams and building local partnerships.
Time zone differences also need to be considered, as does how you communicate. Use tools to support better communication across time zones, such as video conferencing and Slack.
Now more than ever, brands are turning to partnership marketing to fuel global expansion. While partnership marketing is one of the most profitable marketing channels available to brands, they must strategise before expanding into new markets. Global e-commerce, working with influencers, and global platforms are all trends that are shaping the industry, and brands are leveraging different payment models and tailoring their programmes to consumer behaviour to achieve ROI.
But to truly be successful, brands need to do their research and prepare a strategy that accounts for differences in the new market. They also must consider whether they have the people and support required to successfully work with new partners. A lack of market expertise, not knowing market differences, and misunderstanding cultural differences can all cause problems for brands expanding globally. Ultimately, they’ll need to watch for these pitfalls and ensure they have the support they need to meet customers and partners on their terms.
About the Authors:
Helen Southgate is the Chief Global Officer of Acceleration Partners, she has nearly 20 years’ experience in the digital marketing sector across high-growth companies, working affiliate network, client, and agency side. Helen is currently the Chief Global Officer at Acceleration Partners, responsible for Global Strategy across the business. She has been at AP for nearly five years, initially launching the EMEA part of the business in 2017 and took on the APAC region in 2019. Helen previously served as Managing Director at affilinet, one of the largest European affiliate marketing networks, and on the digital marketing team at Sky PLC.
Kelly Ground, Director, Strategy & Insights, Acceleration Partners brings 15+ years of affiliate marketing experience to provide strategic guidance and support to Acceleration Partners’ affiliate programme management teams. Kelly supports initiatives with new and existing clients globally and supports the teams with insights that challenge them to think differently and be innovative. In addition, Kelly leverages her expertise to provide projected retail trends for planning, strategise client campaign strategies, and support strategic partner recruitment. Before joining AP in 2016, Kelly was Senior Digital Marketing Manager at HSN for over 7 years, driving profitable revenue and significant growth through their affiliate and display programmes.