A US new trade rule has accelerated an ongoing trend of buying across borders.
As shopping from been decoupled from physical stores thanks to e-commerce, consumers are less aware than ever of where retailers are actually located. More and more, shoppers are finding that the best deals may be found halfway around the world, and retailers are creating friction-less experiences to help them get what they want.
In March 2016, the US Customs and Border Protection agency changed a crucial trade rule: Americans can now buy up to $800 of foreign goods without having to pay duties or tax, up from only $200 previously.
A much wider range of foreign goods can now be had for prices comparable to those found in their country of origin. The Wall Street Journal reports that at Melijoe.com, a Paris-based luxury children’s clothing retailer, US orders have increased 27% since the change.
The latest rise in borderless buying was spearheaded in the luxury sector first. The e-commerce site Farfetch was founded in 2008 with the promise of connecting shoppers to boutiques around the world through a single website, and today it ships from boutiques in 37 countries to customers in 190 countries.
Today a more global e-commerce shopping experience is now available to many more consumers. According to a report published in December 2015 by e-commerce service provider PFSweb, 54% of US digital shoppers have made online purchases from foreign sites, and, worldwide, 35% of consumers currently shop on sites based outside of their home country, up from 26% in 2014.
Meanwhile, a PayPal study released in November 2015 found that the UK was the world’s third most popular destination for international online shoppers, drawing 86.4 million customers from the 29 counties surveyed.
On the whole, online retailers will have to start thinking of their customers in more global terms. For more, see our forthcoming trend report, Frontier(less) Retail.
Main image: Farfetch Brand Image. Photography by Billy Ballard. Clothing by J.W. Anderson.