E-commerce abroad, specifically in Europe, has received a shot in the arm with the announcement of the partnership between the king of search engines, Google, and Ingenico Payment Services, a flagship brand of the Ingenico group for digital transactions, through a joint venture called the Export Accelerator.
The two companies have the unique advantage of pooling in their respective expertise to provide the perfect answer to the merchants by tapping potential business and successfully converting them into sales through safe and secure payment methods and risk management techniques.
Opportunities and barriers
The Export Accelerator that will be launched in Belgium as a pilot solution set to address the key challenges in cross-border transactions. Belgium has been the first choice because of its multi-lingual market that is reported to also have a great e-commerce potential.
According to Forrester, the European cross-border online sales are expected to grow by a compound annual growth rate (CAGR) of 11% over the next five years and are forecasted to reach €40 billion by 2018. Recently, cross-border sales accounted for 16% of all Western European online retail sales.
The global B2C cross-border e-commerce market will balloon in size to $1 trillion in 2020 from $230 billion in 2014, according to a report from global consulting firm Accenture and AliResearch, Alibaba Group’s research arm.
However, cross-border e-commerce poses a few challenges:
- When it comes to conducting online business outside the borders, businessmen face the issue of language barrier and risk of fraudulent transactions. While this partnership will take care of the latter, the former still remains a prominent reason for wary consumers and businesses alike.
- EU Cross-border deals invariably result in longer delivery times and higher costs, a deterrent in e-commerce transactions.
- Consumer rights, however, are ceasing to be a challenge ever since the EU has initiated consumer-friendly policies like the union-wide policy of 14 days “cooling off” period during which the consumer can return the goods and the introduction of SEPA (Single Euro Payment Area) for harmonized online payments.
Some interesting facts
Anthony Nakache, head of Online Partnerships Group EMEA, had opined during the Webwinkel Vakdagen event at Netherlands that since the online retailers generate more page views than news sites, they need to cash in on this market reach by monetizing the visitor visits via Google Adsense or DoubleClick. However a study by OC&C Strategy Consultants showed that the British online retailers are closed to the idea of generating revenue via Ads unlike their counterparts in the US, and hence are missing out on an estimated 1.3 billion euros worth of advertising revenues by choosing not to sell advertising space on their own websites.
In keeping with this line of thought, Google also recently announced a “buy button” on paid search list that will enable customers to buy a product within a single web page instead of being directed to a different website. The Google-Ingenico partnership, however, comes at an interesting time when Google’s shopping service is being investigated by the European regulatory body over anti-trust violations- the allegations being that the company favours its own products in search results over its rivals’ services.
What does the partnership offer?
The Ingenico-Google partnership will not feature any Android Pay or Google Wallet. Rather, Google which is renowned for its data analytics tools will provide the necessary business acumen to businessmen in terms of identifying potential buyers and then leveraging these insights to bring in relevant solutions, building more traffic and opportunities. Ingenico, on the other hand, will leverage its superior payment technology ranging from providing local payment methods to advanced payment data analytics that also covers online fraud and risk management.
Expressing great satisfaction and hope over this partnership Thierry Geerts, country director, Google Belgium, mentioned, “The Export Accelerator is a great way to help Belgian businesses to grow online. Businesses that invest online grow twice as fast as companies that don’t. It’s our goal to inspire as many Belgian entrepreneurs as possible to make use of the opportunities provided by the web. There are 11 million consumers in Belgium; the 2.5 billion potential consumers worldwide provide a huge export opportunity. This collaboration with Ingenico Group will make it easier for Belgian businesses to tap into that potential.”
“We are very pleased to team up with Google and to leverage our position in the payment ecosystem,” commented Stephen Buechner, EVP e-payments at Ingenico Group, in a statement. “This cooperation demonstrates our ability to continue to simplify payments for merchants while helping them to easily and securely expand across borders.”
