PayPal has made another marketplace friend abroad — this time in the Middle East.
Its latest partnership is with Aramex, a Dubai-based provider of eCommerce logistics and transportation solutions that offers a marketplace to serve consumers in 15 countries across the Middle East/North Africa region, the U.S., Europe, South East Asia and Africa. Because of the marketplace’s (www.ishoptheworld.com) integration with PayPal, it allows consumers to buy easier from merchants across countries and in one seamless transaction.
“Today’s online customers are increasingly discerning when it comes to goods bought online — they search for specific products from specific countries, often unavailable in their home country — and ishoptheworld.com allows these consumers to shop for products from almost anywhere in the world, safer and easier with PayPal,” said Kivanc Onan, PayPal regional director for Turkey, the Middle East and North Africa.
Because of its logistics side, Aramex provides shipping to regions where specific products are not as readily accessible. This aligns with the company’s overall goal of boosting global eCommerce and providing consumers with more efficient ways to shop online across countries. This is done by reducing the supply chain gap between buyers and sellers.
Mazen Mourad, senior eCommerce manager at Aramex, also shared similar sentiments about the impact of its new payments relationship.
“With this innovative marketplace, merchants from across the world — from the U.S. to China — can list easily and free of charge, with no hidden costs, such as transaction fees. This is a unique proposition like no other in the now-cluttered B2C marketplaces. The marketplace eliminates all the hassles of cross-border logistics for the merchants when it comes to export documentation, customs, clearance and costs,” Mourad said.
For PayPal, driving eCommerce across borders has been a particularly important achievement in the past year as it’s continued to grow its global footprint. One reason for the immense growth of cross-border commerce, of course, is that one device that more and more consumers across the world (especially emerging markets) are getting their hands on: smartphones.
The results of PayPal’s latest study on the preferences and practices of cross-border shoppers show just how much the mobile device is opening up a lot of opportunity for cross-border commerce. But mobile is only one half of the picture of what is going to drive eCommerce, according to Melissa O’Malley, director for global merchant and cross-border trade initiatives at PayPal.
“There’s been a lot of research on the growth of emerging markets and how mobile is driving it,” she said, “but to actually see people in those markets verifying that is really exciting for anybody in eCommerce.”
Along with all the positive things that drive cross-border, the PayPal study also determined the potential downside (from the consumer perspective). A lot of that lies in the category of shipping costs, which O’Malley says is “a huge indicator of whether or not someone is going to click ‘buy.’”
She explained in an interview with MPD CEO Karen Webster that PayPal has explored that issue in two ways: in terms of even considering to buy from a merchant outside their local market or — post that decision (but before final purchase) — if it causes cart abandonment. That second factor needs to be kept in mind for merchants, because shipping costs can still be an ultimate deterrent for consumers.
The study found that shipping cost “is paramount” to cross-border shoppers, as about half of them said it would deter them from making an international purchase. On the flip side, free shipping would make people more likely to buy from a website in another country. “But it has been cited as the number one reason for abandoning a purchase from a website in another country,” O’Malley notes. She points out that this is one of the big reasons that PayPal has added free shipping to its list of benefits to PayPal accountholders. It just plain helps merchants “close the deal.”
She cited one example that’s particularly relevant in this new partnership: “If you’re a consumer in India and you made a purchase with PayPal yesterday and you want to buy something from the United States and for some reason you don’t like the product or the way it fits, you can return that purchase, and we will refund the return shipping costs.”
“When you look at research like this and you apply it to the business practice that we do or how we make recommendations to our merchants to enter a new market successfully, that is the really exciting part of this,” concluded O’Malley. “We have ways to lower those barriers and help make it successful for a merchant to go cross-border.“
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More