North America currently accounts for approximately one-third
of total E-Commerce spending and, according to Internet
World Statistics, the US made up just 18 percent of all
e-commerce being done in 2007. (http://www.internetworldstats.com/stats.htm)
These
statements show why perhaps InternetNews said it best when
they wrote,“For US companies, multilingual e-commerce and
business sites are no longer optional.”Still not convinced?
Read on to fnd out why the Internet is already serving
as an international business medium for many companies
and why you may not want to be left behind.
In order to consider whether or not to take advantage
of the Internet as an international business tool one must
frst consider the possibilities it may hold. Who is on the
net? Where do they live and what languages do they speak?
What do your prospects look like for doing business in Europe,
Asia or Latin America? In each of these regions Internet
usage has grown 231.2%, 346.6% and 598.5% respectively from
2000 - 2007. (http://www.
internetworldstats.com/stats.htm)
Although these fgures often raise questions of collection
and tracking methods, research shows that all of the various
statistics and information point toward thesame trends.
It is these trends that will be highlighted below.
There are approximately 1.32 billion people online throughout
the world and only about 20% of them are located in the
US. As for the remainder, approximately 26% are located
in Europe and approximately 39% are located in Asia, which
has seen explosive growth in the area of International commerce
over the past decade.
Further, roughly 78% of Internet users are native
speakers of a language other than English. Out of this 78%,
approximately 30% are native speakersof a language
of European origin (mainly French, Italian, German
and Spanish) and approximately 40% are native speakers of
an Asiatic language (mainly Chinese, Japanese and Korean).
(http://www.internetworldstats. com/stats.htm)
It is important also to note that there is a growing and
largely underserved group of non-native English speakers
right in our own backyard. According to the US Census
Bureau, nearly 20% of Americans speak a language other than
English in their homes. (http://www.census.gov/compendia/statab/tables/08s0052.xls)
One cannot overlook the importance of online communication
in the ever-shifting landscape of where online populations
live and what languages they speak. The estimates for future
Internet use and the potential of worldwide e-commerce continue
to grow in scope and proftability.
It
is important to remember that several countries in Europe,
including France and Germany have been shopping online
since the mid-nineties. And now there are newcomers like
Spain and Portugal eager to enjoy their new-found purchasing
power thanks to a very strong Euro.
Consider France - a European pioneer of e-tail marketing.
In 2007, France registered a 37% increase in online purchasing,
which now makes up approximately 4% of all retail transactions
conducted in the nation. (http://www.multilingualsearch.com/)
An estimated 16 billion Euros were spent in online transactions
in France in 2007 according to Fevad (la Fédéra-tion
du commerce électronique et de la vente à
distance) and that number is expected to grow to 30 billion
Euros by the year 2010. In total there are 19 million
online buyers in France. During the past three years,
the amount the average European spent online grew by 35%.
(http://www.internetretailer.com/)
But other countries like Spain are catching up fast with
an estimated 68% of Internet users shopping online
according to a study carried out by the Interactive European
Advertising Association.
In a survey to discover which products Europeans most frequently
bought online showed that tickets for traveling (83%
searches resulting in 55% purchases) took the top spot,
followed by holiday-related gifts (77% searches resulting
in 36% purchases) and music downloads (62% searches and
25% resulting in purchases). (http://www.euroresidentes.com/.../online-shopping-in-spain.html)
Not only are Europeans receptive to e-commerce, their purchasing
power is on the rise. Eastern European economies are
growing at an impressive rate. As many Eastern European
nations look to enter the Euro-zone, their potential
as invaluable consumers grows. Additionally, the weak dollar
has reversed the US’ traditional role from importer
to exporter.
In addition, all studies point toward the growth of the
online population in Europe as well as a growth in European
e-commerce. It is estimated that while in 1998, only 10%
of Western Europeans had Internet access, by 2007 nearly
45% of Europeans have Internet access.
(http://www.internetworldstats.com/stats.htm)
The European Commission on Science and Technology estimates
that €8.3 billion will be spent online annually by
2010. (http://ec.europa.eu/news/science/070202_1_en.htm)
The
number of Asian Internet users has expanded by more than
345% over the last 7 years. There is the possibility
that this, the fastest growing region of the world, may
rise to the top of the list of worldwide Internet users.
At the beginning of 2000, the region had about 44 million
people online. It now has over 100 million users (and it
should be noted that region has still only achieved a 13.7%
penetration rate; there are millions more people who will
likely have online access in the coming years). (http://www.internetworldstats.com/stats.htm)
Further, e-commerce has exploded in this region. A recently
released report from the Internet Society of China shows
that Internet users in China spent RMB 276.76 billion
($35.5 billion) on Internet services in 2006, an increase
of nearly 50% over the previous year. (http://www.multilingual-search.com/)
Japan, too, remains economically strong with one of
the highest penetration rates for Internet usage in the
world. The economic impact of e-commerce on Japan between
2004 and 2009 will increase its GDP by 10%. (http://www.aip.org/tip/INPHFA/vol-8/iss-6/p26.html)
While the US accounts for less than half of total e-com-merce
transactions worldwide, it still holds a small lead in B2B
e-commerce. Online sales in the US will enjoy a solid 14%
compound annual growth rate (CAGR) over the next fve years
but it is predicted that the e-commerce market will grow
at a more rapid pace in Europe as well as the developing
world over that period. (http://www.forrester.com/)
This means now is an ideal time for organizations to realign
business strategies to target these growth markets
before they peak.
US Companies are Being Left Behind If your site
is still English-only and is only geared towards US
visitors, you are not alone. You are actually in the company
of about 42% of US Fortune 500 companies. (http://www.thebigword.com/
) Though this number has vastly decreased from 2004 when
75% of said companies were monolingual, there is still room
for growth, particularly in consumer based companies whose
locations are not limited to the US A prime example of this
issue is Gap, a $16 billion US company with a global workforce
of more than 170,000 running more than 3,100 stores worldwide,
having only an English, American version of their site.
Not to mention that their website, which does a brisk online
business, does not allow for shipping to locations outside
the US.
Companies with multilingual websites gain a tremendous
advantage. For example, Europeans have a long-standing
tradition of using multilingual sales practices that they
have successfully adapted to the internet age. European
and Asian businesses have more experience with international
marketing than do US companies and thus have an edge.
For them, the Internet is simply another weapon in their
international business arsenal.
As a US company, you need to remember that because of the
Internet you could have a competitor you don’t even
know about, located in Europe or Asia, reaching out to your
customer base via the Internet. Furthermore, depending on
the extent of information offered on your site, your
pricing, distribution and other business models can
be studied by anyone with a web browser if this information
is offered in the target language.
And that’s not all. Not only might you be losing
some business by not reaching out to foreign markets now,
you may even be risking potential future losses as
well. Remember that if you have a presence on the World
Wide Web, you have already, by defnition, “gone global.”
Don’t be surprised if there are some who reach your
site and are unable or uninterested in doing business with
your organization because their linguistic and cultural
preferences are not properly addressed.
Natural Advantages If all of the above
information isn’t enough to convince you that there
is a demand for you to globalize your website, then consider
the natural advantages the Internet offers as an international
business tool:
• You automatically have a potential client
base of 1,319,872,109 people worldwide, mainly consisting
of well-educated 18-60-year-olds.
• By virtue of being on the web, your company
is already accessible 24 hours a day regardless of
time differences.
• Research shows that even Internet users
who have never made an online purchase often use the web
to research products and services.
• The success and potential growth of the Euro-zone
can make it much easier to break into European markets.
• Increased political and fnancial stability
in developing markets such as Latin American and
Asia means a new market of viable business contacts is
eager to obtain goods and services.
As Kaizad Gotla, senior analyst at Nielsen-Netratings states,
“The easiest opportunities are in countries where
Internet usage patterns and user/site relationships are
less established. Acquiring users in markets that are currently
in their growth stages will lead to a loyal user base that
will pay dividends for companies in the future.”
(http://webhostinggeeks.com/articles/web-design/30850.php)
It doesn’t have to be expensive or complicated to
create a multicultural website offering. And most importantly,
if US companies wish to avoid the potential of European
and Asian dominance of Internet business, they best consider
addressing the world on its terms - with multilingual, multicultural
website offerings.
ClientSide
News Magazine - www.clientsidenews.com
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