As the pandemic does a slow fadeout, eCommerce companies are increasingly looking to expand their cross-border reach without taking on the administrative and payments headaches that seeking conversions in other markets typically involves.
There are the building blocks that make it easy for customers to get the products they want: a suite of order management, digital asset management and product information management solutions.
However, companies must also ensure that customers can actually pay for what they want, wherever they are, navigating a complex web of regulatory compliance, taxes, refunds and acceptance of preferred payment methods — not to mention the task of trying to find the smartest path to routing transactions to optimize authorizations.
The barriers are daunting and potentially expensive for even the savviest enterprises looking to scale internationally.
Two longtime players in the space, eCommerce Software-as-a-Service provider (SaaS) BigCommerce and eCommerce enabler Digital River, are hoping the partnership they announced last week provides a compelling solution to the problem, Digital River CEO Adam Coyle told PYMNTS’ Karen Webster.
It’s an ambitious move to create a more powerful platform model that can give rise to the next-generation Shopify or other major marketplace or online cross-border B2B seller.
The solution is aimed squarely at midmarket and large enterprises that don’t have the resources to buy and manage the tangle of tools that were table stakes for international expansion until very recently. Far better, Coyle argued, for companies to opt for an eCommerce engine that integrates localized payments out of the box.
Putting Digital River’s payments orchestration at the center of BigCommerce’s offering is a way of ensuring fewer regulatory hassles, fewer declines and fewer disputes — and ultimately developing whole new offshore markets that were inaccessible before.
“It’s having the infrastructure to be actually operating as a local in those regions because we believe that having a local entity, a local presence, is going to get you a better response from local card issuers than a cross-border response that’s been localized,” he said.
Webster noted that the sheer complexity of international payments and payment types is often too much for even larger businesses to take on. That’s where new integrations can shine.
“We frequently see merchants looking to expand the types of payments they can accept around the world increasingly realizing that things that are common to us in the United States — like Visa, Mastercard — are not necessarily the preferred payment types” in other markets, Coyle said.
Cross-border commerce has become the new promised land for online sellers, as the pandemic has forced companies and governments to allow more international commerce fluidity during product shortages. That new outlook needs a tech stack to match.
A look at how the refund process works — or doesn’t — across multiple geographies can provide a good picture of the daunting complexities.
“All payment methods have a different refund mechanism,” Coyle said. “If you’re a merchant that’s doing, let’s say, $50 million a year in global online sales, you’re never going to have the scale in your business to be really efficient in Romania or whatever country you want to pick. We can bring that scale to you because we aggregate volumes and we aggregate that experience across many, many different clients.”
The Digital River and BigCommerce partnership takes advantage of trends within trends, such as a heightened emphasis on tax and data privacy compliance.
“Sometimes, it’s a regulatory concern,” Coyle said. “Sometimes, it’s a tax concern, and [they] don’t really know how to pay taxes in Bulgaria or Paraguay or wherever. Sometimes it’s a payments concern, meaning, ‘I’m getting tired of having to change my implementation and write code every time an acquirer in Brazil decides to change their message spec.’”
New Brands, New Markets
The BigCommerce deal builds on Digital River’s sweet spot of streamlined global selling.
Saying that the embrace of application programming interfaces (APIs) and microservices is helping players “flatten the stack and enable us to be more nimble as we look to bring new payment types and new capabilities in,” Coyle noted that as areas like B2B cross-border mushroom, this ability becomes vital.
As to where interest is greatest, Coyle said that the U.S. and Europe are as hot as ever, but that emerging markets want access, too, and they’re getting it via these fully loaded platforms.
“From, I’ll call it the brand standpoint, you see Latin American brands who are dying to sell into the global marketplace, you see Asian brands who are dying to sell into other parts of the world,” he said. “It’s fairly uniform from that perspective, although the practical realities can vary on the consumer side, on the selling side, depending on where you are.”
“We do see a lot of demand right now in B2B,” he added. “That’s the one I would say is probably the most interesting in some senses. I think B2B sellers are still relatively new to the online selling game. And we’re seeing a lot of demand from even high-ticket items, complicated B2B sales increasingly moving online, and that’s certainly going to be an area of growth.”