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Gap In Huge Global E-Commerce Rollout

Written by Evan Schuman
August 19th, 2010

On paper, global expansion limited to E-Commerce sites should be light-years easier than doing it with overseas brick-and-mortar locations and employees. In reality, not so much. It’s certainly easier. But with tariffs, taxes, postal codes and local customs, delivering a seamless and fully integrated experience is next to impossible.

Gap, along with its Banana Republic, Old Navy, Piperlime and Athleta brands, announced August 12 plans to move from a site supporting one country to one supporting 65 countries by the end of December. The $14 billion chain is tackling the expansion with two parallel efforts: It’s going to build its own physical fulfillment centers in both Canada and the U.K., in addition to crafting dedicated customized E-Commerce sites for those two countries; and it’s using a vendor to add a small Flash module to replicate local checkout.

“We’re going to be feeding all customers into [Gap] as though they were local,” said Kris Green, chief marketing officer of the global vendor called FiftyOne. “Our checkout is built in Flash. They never leave that merchant’s Web site to do checkout. We’ve built conditional logic that is wrapped around elements of the Web site and can be made invisible.”

Gap likes this approach because it eliminates many of the surprises that global consumers often see at checkout. “It’s an easy experience,” said Gap spokesperson Kris Marubio. “If someone shops with us from Switzerland, they’ll see the total full order amount in their currency, including all duties, tariffs, calculating currency exchange rates. Everything will be all upfront.”

Sometimes, though, upfront is not the ideal situation. On Tuesday (Aug. 17), a vendor called Bongo International announced an extension to its parcel forwarding service in the U.S. with the goal of helping U.S. retail sites to unknowingly ship to other countries. Non-U.S. consumers would be given a U.S. address to use for E-Commerce purchases (315 Seaview Ave. in Bridgeport, CT). Some chains might have a hint that it’s a non-U.S. order if an international credit card is used, but the domestic address makes it easy.

Bongo says it makes its money by charging $5 signup fees, plus optional monthly fees, and it mostly covers costs through steep discounts (in the 70 to 80 percent off range) from shipper DHL. The company admits that some retailers are watching out for its service—”Apple specifically targets parcel forwarders. They don’t want the iPhone going overseas,” said Bongo Sales President Greg Sack—and that a large number of people shipping to the exact same Connecticut address could easily make some retailers suspicious.

One way or the other, it looks like retailers will be doing more overseas shipments next year—whether they know it or not.


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