Selling Online to Americans and Canadians: The Pitfalls.

We all love selling online don’t we? Especially in the UK.

America and Canada are potentially important markets to look at, as there are over 330 million people there. So we want to sell online to Americans, right? (And for simplistic purposes, we include Canada in the term ‘America’ and ‘Americans’ from here on in.)

However, selling from Europe or Australia to Americans can be fraught with problems.

To understand why, you have to understand what Americans consider normal when shopping online, and the American mentality.

So here is what you need to know to sell to America:

Tracking.

If you sell from your own site or are an eBay seller, and/or a Paypal user, then you are absolutely guaranteed to get stiffed pretty quickly if you don’t send everything with tracking. Americans expect tracking numbers with everything. If you don’t have one, they fear fraud as they have an inherent mistrust of foreign sellers.

Tracking -v- Self-Indemnification. 

This is a call you will make depending what you sell.

If you are selling widgets at £5 and it costs £3 to mail them out, tracking is not going to be commercially viable. You will probably send untracked and take the risk.

This means you will have to indemnify yourself against the fraud and chargebacks. So add 20% and suck up the odd refund. Its the price of doing business there. Think of it as a hidden tax.

Simply delay any refunds/claims as long as possible without getting into protracted time-wasting discussion (as some items will arrive during that period).

If you send tracked, try to send tracking numbers with shipping emails if possible. This will save you time fielding all the “Have you got the tracking number” emails that will invariably arrive.

If an eBay seller, upload tracking data there. It helps stave off the item not received fraud and slows down Paypal chargebacks.

Ignore people that ask you to discount postage/items and send untracked and they will take the risk. They wont. They will shaft you.

Delivery. 

Americans only understand free delivery. Make the item cost inclusive of “free” tracked delivery. Anything else, and they will bombard you with emails asking you to confirm the shipping charge covers XYZ postcode in Hicksville, Idaho.

It costs us the same to send anywhere in the States.

Do not get them to use a drop menu system to select location, because they will get it wrong. Here is an example.

us shipping

Not complex to select “USA & World” as location is it?  icon_whistle

But here is what they do if given that option:

uk shipping

And not the odd one. They will do it time and time again. It will become a time sink.

Chargeback and Fraud. 

With Paypal users, all they need to do is pretend the item hasn’t arrived – and they get free cash as Paypal will gleefully refund them from your account. Simple as that. No ifs or buts.

Proofs of posting are meaningless.

The seller will always always always be in the wrong with Paypal.

This is called item not received fraud. Yes, its certainly fraud. But, its almost impossible to prove. So many of them get away with it time and time again. Its a hobby for some of them. Free shopping!

If sending untracked, buy some fake tracked barcode stickers online and stick on the envelope (yes, they exist). That will fool some and dissuade some fraud.

Americans can also charge a credit card transaction back (reverse the payment) on a whim, and on a single phone call with no burden of proof of any wrongdoing at all.

They have no grasp of Sofort, IBAN numbers or other international bank transfer systems, and will think anything other than a credit card or Paypal is a scam. So you won’t get them to pay by any secure,  irreversible means.

Accept that you will be giving some stuff away and write it into your pricing.

Fear of Other Currencies.

Americans understand American dollars (Canadians grasp CAD and USD but they are pretty much the same value). And that is about all they understand. Trying to have them shop in Australian dollars, Pounds or Euros will confuse them.

They only understand dollars and will happily shop in dollars. A shopping cart in anything but dollars will result in a ton of emails asking about currency conversions, “How much does this work out to in dollars?” type questions, how to use a credit card in another currency and other silly stuff.

If it isn’t in dollars, its out of the comfort zone of most.

Charge them only in dollars to avoid that complication. If that means mirror sites or different landing pages, so be it. If eBay, list on the .com site in dollars. Don’t use the pay option on eBay of “US and Canada visibility” from the UK site.

Remember, if using Paypal, Paypal will shaft you on the exchange rate, so take that into account.

Customer Service Issues. 

Another problem with selling to Americans: Americans use chargeback instead of customer service.

They have no concept of time zones outside of the US so cannot grasp why you haven’t replied their email in three minutes at 4am your time.

the-world-according-to-america-2

They will not make international phone calls, so forget that.

As demanding consumers, they expect bells and whistles, including free returns and exchanges (thank Amazon for that). Most sellers want to sell to other continents on a ‘no returns’ basis. Or at best, buyer pays return postage.

That doesn’t go down well there. You will get screamers because of that.

Remember, the first sniff of something that doesn’t suit them or is outside of their normal sphere of experience, you will get the chargeback.

If they are unhappy, and you are an eBay seller, they will gladly one star and/or negative feedback you. Bad DSR’s mean you lose your Power Seller discounts.

Stupidity.

This is a big one. The first rule of selling online to Americans is: Keep it Simple!

Watch this video to see why.

We are not suggesting the entire nation is full of such halfwits, but there are a lot of them.

You can write against a product in big red capital letters “NOTE TO AMERICANS: THIS PRODUCT IS NOT SUITABLE FOR THE AMERICAN MARKET“.

Guess what? Yes, they will still buy it. 

Many seem to only read a description halfway through before hitting “buy”. This means they miss information about delivery times, your international location and suitability of the item in the American market (electricals especially).

If you get the barrage of silly emails asking things they would know had they have read, right after purchase of a product, save yourself the heartache, cancel the transaction before shipping and simply refund them. It will be a harbinger of things to come.

Some of these people will become a time sink if you let them. Dont be shy to dump stupid customers if the stupidity is revealed before shipping. Just say you are out of stock or something.

Delivery Times. 

This one is problematical.

If you are using the Post Office, mail delivery from Europe to the US will be anything between five days and three weeks.

Royal Mail gets mail to the US in about three days. The delay is on their side.

There is no rhyme or reason for this occasional delay; it seems some things get stuck in customs for clearance and some don’t.

The Unites States Postal Service (USPS) is better in some places than others.

However, Americans have little concept of the speed of international mail. We have had emails 24-48 hours after shipping demanding to know why the delivery is late! They are dismayed to find it could easily be another two weeks. Because they don’t read. 

Couriers are much faster of course. But not every item can justify a £50 courier charge (pretty much the minimum you will pay).

If an item is tracked, at least they can see the delay is on their side. When they complain, remind them that US Customs and USPS are beyond your control, and ask them to make an online complaint with USPS.

How to Sell to Customers in the United States of America Successfully. 

Lets recap: Absorb the key points and you won’t go far wrong.

  • Keep everything as simple as possible. Write descriptions in easy language. Use simplified American spellings and phraseology if you know them.
  • Price in dollars.
  • Price with “free delivery”. If tracked, say so, it will make them feel warm and fuzzy. If untracked, say nothing.
  • If untracked, write a margin for item not received fraud into your pricing.
  • If you can afford to send it tracked, do so. Send/upload tracking numbers if feasible.
  • If using Paypal, know the average exchange rate to get dollars into your currency.
  • If using eBay/Paypal, expect a higher than usual fraud rate. Amazon is a bit better.
  • Don’t be shy to dump a stupid customer before shipping.
  • Delay claims/chargebacks as long as possible – some will melt away as items arrive late.
  • Have some pre-written emails to explain for example – again – the speed of international shipping, customs delays, etc. Copy and paste is faster that replying the same stuff over and over.
  • Don’t get into long exchanges with stupid people. Deal with the complaints in the fastest way possible. Sometimes that means a refund. Its built in your pricing, so suck it up and move on.
  • Don’t dwell on it when you have been stiffed by Paypal, a credit card company or a dishonest buyer. Move on, sell more, and make the losses back.

 

Pricing Example.

Lets say I want to sell some widgets on eBay. I need £5 for them. It costs me £3 to send a widget (untracked) to the US. eBay/Paypal fees are circa 14% on total price before volume discounts. As I am sending untracked, I need to add 20% for fraud and to cover my time dealing with stupidity. The dollar right now is about $1.70/£1, so that means $1.85 through Paypal.

Here is the sum: £5 + £3 = £8 product with “free” delivery. Add 14% seller fees and then 20% to cover fraud = £10.94. Multiply the price by the average Paypal usurious dollar exchange rate and we get $20.24.

Psychologically, $20.24 will not convert into sales well, they like everything to end in 99. So price that item at $19.99 including free delivery.

Case Study.

Here is a British site that sells stuff to people who keep chickens: Omlet

And here is their simpler site in dollars aimed at the US: Omlet America

Totally different site. US domain name. American 1-800 number (redirecting to the UK). Paypal accepted. Simpler English. Priced in dollars including free tracked delivery. These guys totally get it! 

Keep it simple. Send tracked if possible. Sell in dollars. Job done. Now go and sell to those 330m+ people. thumbs

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