5 phases of international expansion: from planning to profitability

Written by Max Riis Christensen

Launching an international webshop requires a combination of local experience and e-commerce expertise. The challenge lies in transitioning from a newly launched webshop to a market leader that generates revenue and adds value to the company's bottom line. 

We have found that on the path to success in international e-commerce, there are five phases that all webshops must go through - from initial planning to profitability. Understanding these phases and the specific skills and knowledge required for each is crucial for achieving international success.

Phase 1: Decide

As Franklin Covey wisely said, "Begin with the end in mind." In this phase, it's essential to choose the right country that aligns with your products, ambitions, and budget. To make an informed decision, you need to prepare a business case. It can be a simple or advanced analysis, but it should provide insights into the necessary investments and help you make a solid choice for the future.

Phase 2: Localise

To meet the expectations of new customers, your webshop needs to be localised. Building trust is key, and trust is established through seamless payment processes, reliable delivery, hassle-free return procedures, and an overall positive shopping experience. The specific requirements for localization may vary across countries and industries, depending on cultural norms, competition, and your unique goals.

Phase 3: Optimise

Regardless of how thorough the localization phase is, it's crucial to take the time to verify that everything functions as expected. A strong conversion rate is the key to profitability. We recommend benchmarking the conversion rate against the home market and striving to achieve a similar rate in the international market. This phase focuses on fine-tuning and optimising the webshop to maximise its performance.

Phase 4: Grow

Many promising projects fail due to losing focus and importance within the organisation during the growth phase. We support our customers in navigating this critical stage, ensuring that the revenue generated by the international webshop is significant and that the resulting profit can cover expenses. Maintaining momentum and strategic focus is crucial for sustainable growth.

Phase 5: Succeed

The final phase is all about profitability. We explore ways to optimise processes, marketing strategies, logistics, and customer service to increase the overall profit generated by the webshop. This profit can be reinvested in further growth or directed towards expanding into new markets.

By following these five phases, businesses can successfully expand internationally, leverage their webshops for increased profitability, and lay the foundation for future growth and expansion into new countries.