International E-commerce Expansion Flashcards

A subscription box company wants to ship monthly boxes to Japan but faces high return rates. The most effective first step is:

Answer: Conducting detailed Japanese consumer research to align product selection with local preferences and seasonal expectations

High return rates in a new market typically signal a product-market fit issue; understanding local preferences, unboxing expectations, and seasonal relevance (like Japan's gift-giving seasons) is the foundation before other tactics.

What is 'DTC cross-border' e-commerce and what is its primary advantage over marketplace selling?

Answer: Selling directly to end consumers internationally via a brand's own website; advantage is full control over brand experience and customer data

DTC (Direct-to-Consumer) cross-border e-commerce means selling through your own website internationally, giving you full control over brand presentation, customer relationships, and first-party data unlike marketplace selling.

Which metric best measures customer acquisition efficiency when entering a new international market?

Answer: Customer Acquisition Cost (CAC) compared to Customer Lifetime Value (LTV) in that market

Comparing CAC to LTV in each specific market reveals whether customer acquisition spending is economically justified given local purchasing patterns, churn rates, and average order values unique to that market.

An international e-commerce merchant wants to accept local payment methods in Southeast Asia. Which regional mobile payment ecosystem covers the most countries in the region?

Answer: GrabPay with cross-border partnerships across Singapore, Malaysia, Thailand, Philippines, and Vietnam

GrabPay operates across multiple Southeast Asian countries and has partnerships and integrations that give it broad regional coverage among the region's dominant super-app ecosystems.

What is the 'digital services tax' (DST) that several countries have implemented, and how does it affect cross-border e-commerce platforms?

Answer: A tax levied on revenue generated from digital services (including marketplace fees and digital advertising) earned in a country, regardless of where the company is headquartered

DSTs (implemented in France, UK, Italy, and others) tax revenues from digital marketplace services, advertising, and data monetization in a country even if the platform has no physical presence there, increasing operating costs for global platforms.

A merchant discovers that their international product listings rank poorly in local search engines despite strong US SEO. The most likely cause specific to international SEO is:

Answer: Failing to implement hreflang tags and country-specific domain or subdirectory structure

Hreflang tags signal to search engines which language/country version of a page to serve to which users, and proper URL structure (ccTLD, subdomain, or subdirectory) helps search engines correctly attribute content to the right geographic market.

What does 'customs bonded warehouse' offer that makes it strategically valuable for international e-commerce fulfillment?

Answer: Allows goods to be stored without paying import duties until they are released for sale, enabling merchants to defer duty costs

A customs bonded warehouse lets importers store goods under customs supervision without immediately paying duties, deferring those costs until goods are withdrawn for sale, which improves cash flow for international merchants.