On September 22, the "Independent Stations Still Fighting - Independent Station Brand Overseas Cloud Summit" held by Airwallex was successfully concluded. 1 roundtable discussion + 9 topic sharing, this live broadcast brought together 10 overseas industry bigwigs from Shopify, Google, SHEIN, Zero One Venture Capital, Weizhuo, Deloitte, Miss Ren Cross-border Brand Research Institute, etc., focusing on the two major themes of independent station overseas trends from the perspective of capital and low-cost traffic marketing, with forward-looking views and new cases, attracting tens of thousands of viewers in the live broadcast room.

The text summary is as follows :

● Assessing the situation: roundtable discussion on the opportunities and trends of brand transformation in the overseas industry

● A hundred schools of thought contend: Shopify/Google/venture capital/Deloitte experts analyze the independent station industry ecosystem

● Competing for the low point: Airwallex shares the principles of cross-border payment cost control

● Reduce costs and increase profits: SHEIN/Weizhuo/Miss Ren and other pioneer sellers share low-cost operation strategies

Assess the situation

Opportunities and trends for brand transformation in the overseas industry

In the post-epidemic era, European and American countries are mired in high inflation, and the interest rate hikes in many countries have also exacerbated the instability of the world economy. According to data from the Ministry of Commerce, China's cross-border e-commerce imports and exports reached 1.69 trillion yuan (RMB, the same below) in 2020, an increase of 31.1%; in 2021, the scale of cross-border e-commerce imports and exports reached 1.98 trillion yuan, a year-on-year increase of 15%. In such a seemingly contradictory market background, are the comparative advantages of China's cross-border export e-commerce still obvious? Compared with domestic e-commerce and the domestic business ecosystem, is China's cross-border e-commerce still a track worthy of attention for domestic entrepreneurs?

Corey Chen, Vice President of Airwallex China and Head of Corporate Account Business, served as the moderator of the roundtable discussion. He discussed the above topics with Tao Yangfeng, Vice President of Zero One Venture Capital and a well-known cross-border e-commerce investor, and Zhou Rui, Industry Manager of Google's Key New Customer Team.

Tao Yangfeng: China's cross-border e-commerce still has advantages, but it is showing a polarization phenomenon. At the product level, low-end consumer categories are limited by the competitive pressure of the stock market and have a downward trend; but at the regional level, some brands that have shifted from Europe and the United States to emerging markets such as Southeast Asia, the Middle East, and Latin America are growing positively .

For China's cross-border e-commerce exporters, the supply chain is a very important advantage . On the energy side, the price of traditional energy is stable, and the potential of new energy is huge; on the industrial side, the manufacturing industry cluster is complete; on the talent side, the reserve of high-tech talents such as engineers is growing; plus the resource base accumulated over a long period of import and export trade, the above together constitute a complete supply chain system that can support the steady development of domestic cross-border e-commerce.

For overseas users, there are still some bad shopping experiences such as long delivery cycle. Where there are pain points, there are opportunities, and where there are opportunities, there is room for development, so cross-border e-commerce is still a track worthy of attention .

Corey Chen: Compared with the traditional models of cross-border e-commerce such as site groups, distribution, and traffic investment, why have the main brand models such as DTC and independent sites become new business formats favored by more and more cross-border e-commerce?

Zhou Rui: Why should sellers focus on building brands? In an era of increasingly fierce market competition, more and more consumer choices, and rising traffic platform costs, it is difficult for sellers to survive in a healthy state by quickly gaining new traffic in the early stage, so building brands is particularly important. Brands can drive word-of-mouth marketing and bring premiums to products .

Why do we need to build an independent website? An independent website is an important way to shape a brand , reflect brand elements, and complete conversions. An independent website can also enable sellers to have independent pricing power to generate more profits. An independent website can also accumulate user data and feed back marketing /products. At the same time, an independent website can also use marketing methods to increase user repurchase and increase the value of the user's entire life cycle. In addition, the cash flow turnover will be faster .

Corey Chen: Indeed, whether it is brand building, user experience, or back-end operation processes, the independent station model allows sellers to personally control more links. Back to the previous topic, as the global industrial chain layout undergoes changes in the post-epidemic era, how will the trend of supply chain diversification affect key fulfillment links such as production, procurement, logistics, and warehousing?

Tao Yangfeng: Sellers first need to make steady plans , pay attention to the rhythm, and stop losses in time if the situation is not good. In addition, they need to do a good job of product positioning , have a clear understanding of the business they are doing, do not rush in blindly , and control cash flow.

Corey Chen: The cash flow turnover speed may vary from brand to brand, in addition to its own operational capabilities. Another key factor is the length of the fulfillment cycle. Whether it is the first batch of cross-border e-commerce sellers in the early years, or the emerging brands that have quickly entered the cross-border market with the support of capital in recent years, everyone has a common question, that is, whether to build local warehouses and localize the supply chain during the overseas fulfillment process?

Tao Yangfeng: Whether the supply chain is localized is mainly related to the brand's main categories . It is highly recommended to develop localization for large categories, but for categories with many SKUs, complete localization means increasing inventory pressure. Some predicted hot products can be stocked in overseas local warehouses. Therefore, brands need to consider their own product categories, but from the user's perspective, the localized experience is definitely better.

Corey Chen: In the field of financial technology, Glocalisation is to improve the efficiency of the overall system by keeping some businesses, products, and supply chain fulfillment global and appropriately localizing other parts, so as to find the best solution to match the corresponding situation in the dynamic market and different categories. Through today's discussion, I believe that the development of the cross-border e-commerce ecosystem has a great chance of success in the future, and I hope to bring more new ideas to all sellers and ecological partners.

A Hundred Schools of Thought

In-depth analysis by experts in the independent station ecosystem

Venture Capital Circle: Looking at the trend of cross-border e-commerce going global from the perspective of capital

Before talking about the future, let us first understand the past. Looking at the history of cross-border e-commerce development, it started from the embryonic stage of the B2B foreign trade era before 2005, to the budding stage of moving from "foreign trade" to "cross-border e-commerce" in 2010, from the development period dominated by platform sales in 2015, to the explosive period of over one million industry sellers before 2019, and then to the epidemic era 20 years later. It has gone through 5 stages. After the "wild growth" period of the outbreak, it has now returned to the steady growth rate of "intensive cultivation", with a fragmented structure and a value fault zone of 3-5 billion US dollars.

According to the current situation of the industry, the future development trend of cross-border e-commerce is 1: from the past focus on selling goods to the development of focusing on product attributes , which will bring about changes in channels. Trend 2: China's cross-border e-commerce must achieve a balance of "profit" in the development of "quality", "quantity" and "speed" in order to maintain a reasonable profit. Compared with overseas DTC brands, domestic sellers have higher operating efficiency, but the brand still needs to be continuously shaped. Trend 3: Pay attention to digitalization and compliance , and make good use of various tools to do a good job in brand planning and improve efficiency.

Website building platform: Building DTC infrastructure with Shopify

With the rise of e-commerce and social media in recent years, the DTC (Direct-to-Consumer) model has removed the middlemen such as wholesalers and retailers, entered the market from a more segmented field, and attracted consumers through cost-effective products. With its greater autonomy , it also brings the advantage of feeding back product design and operation management through first-hand user information, and can establish a more direct and continuous connection with consumers , maximizing the lifetime value of consumers.

More than 50% of the top 20 apparel DTC brands use Shopify to build their websites, including well-known brands such as Kylie Cosmetics, Crate & Barrel, and Omnidesk. Shopify can provide fully integrated and fully functional backend management, and can conduct cross-platform promotion on social media through a single portal. It also has a rich third-party developer ecosystem, seamlessly connects to enterprise applications, and creates a top user experience for merchants.

Tax compliance: Discussion on tax compliance of cross-border e-commerce enterprises

As the domestic efforts to reduce taxes and fees continue to increase, the "Golden Tax Phase IV" has ushered in the era of "taxation by numbers", and the scope of tax assessment has become stricter and more standardized. In order to cope with the challenges brought by the digital economy internationally, the Organization for Economic Cooperation and Development (OECD) has taken the lead in formulating the "Base Erosion and Profit Shifting" ( BEPS) two-pillar plan . In addition, the European VAT reform since last year has accelerated the tax compliance of the cross-border e-commerce industry .

Common tax and customs issues, such as overseas indirect taxes, and tax issues related to import and export, are they compliant? Enterprises can consider setting up different functional companies overseas, combining the better local tax incentives to reduce local tax costs and improve compliance. When reducing the collective tax burden of enterprises, we should also pay attention to the potential risks of the current high-tech tax incentives , whether the tax profits are reasonably distributed among various entities, and other details.

(Image source: Deloitte China)

In the era of tax audit big data, the daily operation and management process of an enterprise is like a transparent body. In addition to being familiar with import and export-related tax policies, cross-border e-commerce companies must also pay attention to tax compliance issues in their operations, and some common tax risks must be taken seriously.

Independent Station 0-1: Avoiding Pitfalls and Boosting Volume on the Road to Brand Transformation

Sellers who switch from selling on third-party platforms to building independent websites need to beware of three misunderstandings. First, they need to switch from selling to branding , and second, they need to avoid the misunderstanding that marketing = advertising. Brand marketing has a process of reaching-planting-endorsement-conversion, and sellers need to use a multi-channel approach that combines performance marketing with brand marketing to create brand volume. In short, brand marketing = content × advertising. Content is the foundation of marketing, and advertising is an amplifier. Misunderstanding 3 is "I have an independent website, and I will start advertising today." The premise of advertising is good website optimization and a clear operation team.

The purchasing path of consumers is complex and nonlinear. If you want to expand the volume, for sellers who want to transform to independent sites, a more common strategy can be used as a reference: collect data for testing in the first month ➡ release the best combination for preheating in the second month ➡ go all out to promote sales in the third month. During this period, Google has various advertising products and marketing strategies to support sellers in achieving volume growth.

Competition for the Lowlands

Cost Control of Brand Overseas Expansion from the Perspective of Global Payment

According to data from SaleCycle in 2022, about 80% of sales losses come from buyers adding products to their shopping carts but not completing payment1 ^. This shows that the payment experience actually determines the final conversion of all previous sales and customer acquisition behaviors. Similarly, payment connection methods with website building tools, payment page design, anti-fraud and other payment technologies are also important factors affecting sales conversion rates.

From the perspective of payment, how to improve the conversion rate of independent stations by increasing revenue and reducing costs. First of all, acquiring is the key, which can maximize the conversion rate of acquiring; secondly, maintain marginal profits and use Airwallex's one-stop solution to enhance the operational efficiency of overseas companies.

Grasp every link of acquiring and rationally view the payment success rate from a macro perspective

In the strategic development of e-commerce, merchants cannot just focus on the positive growth of payment success rate, but should rationally analyze the payment life cycle and reach a balance point that can support sustainable growth.

When the consumer clicks to pay, the acquiring link that carries the flow of funds will go through "receive payment request ➡ pass risk screening ➡ pass verification ➡ authorization ➡ request payment" to finally complete the payment process.

1. Receive payment request

In the first step of acquiring payment, it is necessary to maximize consumers’ willingness to buy . There are many reasons for order loss, such as excessive additional costs, additional registration, non-support of preferred currencies, lack of trust in the website, insufficient payment methods, etc. Sellers need to minimize the impact of cumbersome payment operations and increase consumers’ willingness to buy.

● Support local payment methods :

The use of digital wallets by consumers around the world is diverse and fragmented. We maximize support for local mainstream payment methods and ensure that customers can complete transactions using the payment methods they are most accustomed to.

Of course, with such a large number of local payment methods, if you do not use a third-party payment platform and choose to sign a contract with each local payment method separately, you will not have the advantage in terms of efficiency and price. Airwallex has global funding capabilities and can help merchants connect to 71 local payment methods around the world. It is deeply localized in Europe, Southeast Asia and other regions, and merchants can easily open and match their own payment methods.

(Data source: Airwallex internal statistics in 2022)

● Optimize the smooth payment experience:

When filling in payment information, every detail of the consumer experience will have an impact on the success of the transaction. In this process, Airwallex's intelligent error correction function can play an important role. After the user fills in the payment information, the intelligent error correction function can review the payment information, automatically report errors and make correction suggestions to avoid information errors and improve the accuracy of the user's payment information.

(The content of the picture is for illustration only and is not real information)

Airwallex has also developed a card storage function that securely stores payment information through payment tokens. After the user enters the payment information once, it will be archived in the payment function and there is no need to fill it in again in the future. By automatically filling in the card information, customers can save time and energy in the payment process.

2. Pass the risk screening

Growth is a double-edged sword. The more attractive and the better the sales of a product, the easier it is to be exploited by fraud organizations. In more established overseas companies, the anti-fraud team may even reach a scale of 100-200 people. In order to deal with fraud risks, risk control tools are particularly critical.

In the era of risk control 1.0 , the main focus is on entry-level risk control based on rules . When consumers violate risk control rules, they will be blocked, but the setting of rules is often difficult to grasp. In the era of risk control 2.0 , the main focus is on big data AI learning risk control . The big data intelligent risk control engine can judge the risk level of transactions based on historical transaction data summary and multi-dimensional transaction data analysis, accurately blocking fraudulent transactions while allowing legal transactions to the greatest extent possible.

3. Pass verification

Airwallex uses industry-leading risk models to calculate transaction risk scores and operates big data artificial intelligence technology, allowing customers to define black and white lists based on their own business characteristics, risk preferences, local consumption habits and other factors, and customize risk control mechanisms with advanced machine learning risk control models to flexibly trigger 3DS verification, thereby accurately combating fraud and credit card fraud without affecting the payment experience of high-quality consumers.

4. Authorization:

● Directly connected to the card group, more stable and secure. Compared with some payment companies that are only acquiring gateways and "resell" number segments, Airwallex is a global member of international card organizations such as Visa, Mastercard, and UnionPay. As an acquiring bank directly connected to the card group, it can ensure the financial security and compliance stability of bank card acquiring. At the same time, it has better rates, faster settlement speed , and high capital turnover efficiency. One merchant corresponds to one merchant number, avoiding the financial security and compliance risks caused by multiple merchants sharing the wrong merchant number.

● Flexibly configure the optimal MCC to further optimize the payment success rate. MCC (Merchant Category Code) is simply understood as when a merchant requests payment, different products will have a dynamic code in the card group, indicating the merchant's main business scope and industry affiliation. If a merchant uses a code that does not match the category, it will be punished accordingly.

Airwallex supports local acquiring in Hong Kong, Singapore, Europe, Australia, and the United Kingdom , which can significantly increase the success rate of bank card acquiring compared to cross-border acquiring. On the technical level, Airwallex's MCC dynamic optimization capability also comprehensively improves payment success rates from multiple dimensions.

5. Request payment

● Reduce foreign exchange losses. Airwallex can flexibly choose multiple settlement currencies based on the location of the merchant acquiring entity, minimizing foreign exchange losses for enterprises.

● With better settlement timeliness in the market, Airwallex’s settlement cycle is as fast as T+1 to T+4, helping merchants avoid financial risks, improve capital utilization efficiency, and efficiently transform every revenue into development momentum.

Save costs and improve capital utilization efficiency

1. Multiple settlement currencies to choose from, flexibly saving foreign exchange costs

Traditional payment service providers only support a single currency. Merchants need to perform a secondary currency conversion because the store pricing currency is inconsistent with the settlement currency, which incurs foreign exchange costs. Airwallex allows merchants to open accounts online and conveniently, allowing merchants to select the merchant settlement currency from 7 currencies including USD, HKD, EUR, etc. , to retain the profit of each transaction to a greater extent.

2. One-stop access to the entire chain of fund collection, management and payment

With Airwallex, you only need one choice for multiple funding links. From acquiring to currency exchange, payment, card issuance, and fund management, it enhances end-to-end timeliness and saves comprehensive funding costs.

3. Airwallex launches a new Shopify payment plugin

In July, Airwallex officially launched its payment acquiring plug-in product on Shopify. Merchants on the Shopify platform can start secure and efficient Shopify payment acquiring with just a simple setup.

● Support 33 payment methods

It provides 33 payment methods, including Visa, Mastercard, UnionPay bank cards, and local payment methods such as WeChat Pay, Dana, Kakao Pay, etc., seamlessly adapting to the payment habits of local consumers.

● Exclusive local Chinese customer service to provide customers with a quality experience

A 24/7 dedicated local customer service team can easily and promptly resolve daily payment management needs such as reconciliation, risk control optimization, payment success rate improvement, dispute resolution, etc.

Currently, Airwallex's acquiring solutions have been launched on multiple mainstream website building platforms, providing convenient plug-in docking options for merchants on website building platforms. In addition to plug-in docking, Airwallex also provides flexible docking methods such as hosted page integration, core component docking, and fully customizable API integration.

Scan the QR code below now to unlock the new Airwallex global payment acquiring experience.

Reduce costs and increase profits

Pioneer seller shares low-cost operation strategy

Influencer Marketing: Building a Quality Brand through Influencer Marketing

Marketing in collaboration with influencers is a powerful tool for cross-border sellers to improve their product power, channel power, and brand power. It can help consumers understand products and enhance their trust, shorten purchase decision-making time, and improve transaction efficiency. For brands, they can also obtain high-quality advertising materials and product feedback. Influencers can be simply divided into KOLs (Key Opinion Leaders) and Influencers (social media influencers). Brands need to choose the influencers and social media platforms that suit them, rather than blindly pursuing fame and traffic.

How to start cooperation with influencers? You can consider four aspects: compensation, frequency, content, and contact . Content is particularly important. You can attract attention and inspire action through the influencer's outstanding creativity. On the YouTube platform, influencers can @ brands through medium and long videos, share shopping links and discount codes, and on Instagram, they can add relevant # tags and snap links to interact with fans. On TikTok, influencers can also attract distribution by adding tags and discount codes to increase brand awareness.

When choosing an influencer, you can get a general idea of ​​the influencer’s type through the quick updates /personal positioning/cooperation email/homepage style on their homepage information , and check the content of their posts and the quality of their comments to determine whether they are high-quality. Be sure to avoid influencers with few comments, single comment content, poor quality materials, and false advertising. If necessary, you can choose an excellent overseas marketing agent to escort your company’s overseas expansion.

(Photo source: WeDTC )

Brand Practice: How to Build a Cross-Border Brand

Sellers often ask if there is a "good" category that can create a "good" brand? What is the key to brand success ? Is it product selection? Or marketing? No, it is positioning . Think about user positioning - who is your precise user, think about product positioning - what is your product. Find the difference, the same category with different positioning, the brands created can be very different.

The shortcut to capture the user's mind is to become the first . What if you can't be the first? Refer to the "non-cola positioning method" to become the first in the market segment . Many brands make a mistake, which is to want to attract every consumer and ignore the importance of maintaining a narrow focus . Successful positioning requires consistency, just like Zoot, a brand founded in 1983 that focuses on triathlon clothing and accessories. The user positioning is triathletes and enthusiasts. In 2020, the number of participants in this sport worldwide was only 1.36 million, but in 2021, the brand's revenue has reached US$39.7 million.

How to build a brand strategy based on positioning? First, understand who the users are and research user portraits /demand pain points/solutions on the market. Secondly, look at brand positioning , develop product solutions, and determine the brand's mission and image. Finally, think about how to build a connection between the brand and the user , choose the right marketing method, connect with the user and promote purchase conversion. So for independent station brands, they are not afraid of positioning incorrectly, but they are afraid of having no positioning at all.

(Photo source: Ms. Ren’s Cross-border Brand Research Institute)

Low-cost traffic generation: Three tips for independent site SEO

If an independent website wants to do a good job in SEO, it must first find keywords that users really care about, so as to attract accurate traffic. Only with accurate traffic can the conversion rate be improved; secondly, analyze the page SERP (search engine results page) ranking, integrate keyword proof words based on the content of the page that ranks before Google and collect SEO layout; you can also use paid SEO tools for comprehensive analysis. The more keywords rank on Google, the higher the natural weight of the website and the higher the traffic. Optimizing the front-end code allows search engines to better understand the structure of the website and improve search engine rankings from a technical perspective.

Clothing brands going global: Becoming an OBM supplier at SHEIN offers more possibilities

When clothing sellers go overseas, they often face great pressure to prepare inventory in overseas warehouses, high operating costs, and significant differences in logistics costs. If a product is unsalable, it is difficult to choose whether to return it or destroy it, and it is difficult to train core talents for the operation team, etc. Recently, SHEIN, as a "unicorn" company in the field of self-built websites, launched an OBM supplier recruitment plan.

If you have registered a brand trademark, if you own a store on an e-commerce platform, if you are running a clothing brand, you can use the OBM model to support merchants in supplying their own brand products for sale on the SHEIN brand platform. By participating in promotional festivals such as the global wedding season planned by SHEIN, iterating on shooting visual effects according to SHEIN's merchant operation suggestions, and filling gaps in the large-size market, you will have the opportunity to increase brand traffic and sales.

This live broadcast will bring together the first-line platforms of the independent station ecosystem within 4 hours to interpret the trend of going overseas; 10 industry leaders will share their practical experience; integrate venture capital parties to discuss the financial and tax structure and investment trends; focus on cross-border payments to explore the principles of cost control; pay attention to the marketing front, decipher low-cost traffic diversion solutions, and share brand overseas prospects and low-cost marketing guidelines for independent station sellers. In the future, Airwallex will continue to build digital cross-border payment and financial infrastructure to help companies conduct online acquisition, easily realize global payments and simplify corporate financial operations, and use a one-stop technology platform to help modern companies achieve global business growth. Pay attention to the Airwallex Cloud Riding Plan and participate in more cross-border e-commerce boutique activities.

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