Growing a Global Amazon Empire: How to Reach International Markets

April 22, 2020
By The Badger

Expanding territory has been the goal of many leaders. Thomas Jefferson made the Louisiana Purchase to expand America. Andrew Johnson acquired Alaska, and you, as the leader of your business, can expand your reach on Amazon.

Amazon sellers often put themselves in an imaginary box by selling only in the United States, but in this post we’re going to show you how to take the first steps toward reaching customers around the globe.

Why Branch Out

A common thread we see when discussing branching out into international markets with sellers is that the practice is often thought of as something to do in a couple years. Sellers often want to firmly establish their business in the United States and then look into selling in other countries.

Without a doubt, only selling in the U.S can lead Amazon sellers to great results and it is important to allocate most of your resources (time, money, etc.) to selling here, but very few sellers realize the two downsides of this strategy.

Wasted time
Increased risk

Wasted Time

There is only so much time between right now and one year in the future. If you were to start selling your products in Canada, and Canadian sales represent 10% of your total sales, the return on that time is 10% greater.

If we were to tell sellers that we had a magic formula to bump up a seller’s yearly revenue by 10%, surely most of them would be chomping at the bit to find out what that formula is. For you, it could be selling across the globe.

Increased Risk

Never put all of your eggs in one basket. What would happen to your campaign if a major event takes place in the United States that reduces traffic to Amazon? For sellers who choose to only sell in the United States, any change to how Americans shop online will have a massive impact.

Now, what if you sold in three additional international markets and these three markets combine for 30% of your total revenue? From the jump, your risk is decreased by around 30%. Even if these markets somehow don’t increase your total revenue, diversifying your customer base leaves you in a less vulnerable position.

Getting Started

Once you jump through the initial hoops, getting started in international markets is pretty simple. Sellers often fear that the time commitment will be too much of a burden or that it will be too complicated.

As far as time is concerned, getting off the ground in another country won’t require a large time investment. Why? You don’t have any data, so testing what works and what doesn’t with your listings and bids is all you can do.

Most sellers don’t realize just how simple selling in another country is. It’s as easy as clicking a country on a drop down menu and the only thing that looks different is the currency symbol.

Once a campaign is up and running in another market, keeping up with that campaign is hard for some sellers. It’s too easy to get really excited about selling internationally, not build a sound strategy for time management, and have big problems three months later because you forgot to keep up with it.

The strategy we recommend is pretty easy to remember. Find out what percentage of your total sales come from international markets and use that percentage to allocate your time. For example, if you only sell in one non-U.S market and 10% of your total sales are international then 10% of the time you spend on PPC should be working on international campaigns.

International Markets and Your Business

Amazon has a lot of great resources to help you get started with selling internationally. One of the most important topics these resources cover is VAT (Value Added Tax). VAT can seem intimidating and a reason to avoid international markets, but a quick call to the tax administration of a country can quickly get you squared away and ready to sell.

One area where VAT will have an impact is your margins. Let’s take a look at how our English-speaking friends, Canada and the United Kingdom, levy taxes on sellers.

Each country is it’s own animal. Amazon has different URLs for every country, and most people only purchase items in their country’s version of Amazon. This means that competition is different in each of these markets.

If you want to see the best results in each of these markets, check out our comprehensive guide to Amazon PPC.

How Unknown Variables Affect International Sales

Obviously, (at the time of posting) the world is facing an unprecedented situation with the sudden emergence of COVID-19. No one can predict when an unknown variable, such as a global pandemic, will present itself. However, selling in multiple countries can mitigate your risk when an unknown variable comes into the equation.

We discuss other ways to mitigate your risk, such as diversifying your supply chain, in our post about COVID-19 and its effect on business practices.

At times of uncertainty surrounding supply chains, day to day life, and timelines for normalcy to resume, sellers who are in international markets aren’t at the mercy of how the United States is responding.

During the coronavirus epidemic, sellers who have expanded into other countries have weathered the storm by still bringing in revenue from non-US markets. Amazon hasn’t had nearly as many restrictions in countries such as Canada and the U.K. Sellers who’s items have been deemed “non-essential” in the United States are still selling those products in other countries.

Key Takeaways

Selling in global markets can make a dramatic change to your business. Not only does it tap into a new source of revenue, but selling in multiple countries mitigates your risk and helps maximize the return on your time.

By following the guidelines discussed in this post, you can ensure that you’re setting yourself up for success in a variety of global markets.