cotton traders

1

Closer to Home: The Expat Market

2

The British Expat Community

4.7 million British Expats around the world.

Top destinations include Australia, USA, Spain, Canada and France.

Same top destinations for last 20 years, with Australia top.

Approximately 25% of Expats are retired.

3

Cotton Traders Expat Survey Findings

76% said the way of life was the best thing about living overseas followed by climate (45%).

55% said they spend their free time socialising (strong community ties – likely to recommend good product or service).

76% intend on staying overseas.

February 2014. Based on 550 respondents

4

How it Began

We received requests from customers living overseas.

Cotton Traders target audience aligned with retired British Expats.

Researched the main areas for Expats in Europe (avoiding customs regulations).

Project Team – Website, IT, Supply Chain, Marketing and Finance.

5

Early Days

July 2012 – opened up delivery to France, Spain, Ireland, Cyprus, Malta and Portugal.

Promoted to customers – parcel inserts, email and in store.

Orders from day one with no advertising.

UK customers with a second home abroad, some who had moved permanently.

Worked with a media agency who specialise in Expat market.

6

Performance To Date

SS13 – added 6 new countries (Italy, Greece, Belgium, Netherlands, Sweden and Denmark.

SS13 +58% vs AW12

AW13 +74% vs AW12

SS14 projection +35% vs SS13 (added Germany in June)

AW14 budgeted sales +68% vs AW13

They order more frequently than a UK customer

They have a larger average order value than a UK customer

7

Performance To Date

France and Spain are our top performers.

8

Challenges Faced

Challenge 1Difficult to reach – may be intentional.Expat publications are limited and have low circulation. Advertising is relatively expensive – poor CPA (but generate awareness).

SolutionMore creative in finding ways to reach them

Working with partners.

Going back to basics

9

Challenges Faced

Challenge 2Product mix needs to be suitable given warmer climates

SolutionIntroduced ‘Winter Sun’ section to website for AW months.

Invested in new technology allowing more tailored solution.

10

Challenges Faced

Challenge 3Customer feedback requesting changes to payment process.

SolutionListened to feedback and we introduced PayPal in June.

Removed our Delivery = Billing address rule

Currency converter

11

Challenges Faced

Challenge 4Logistical issues – high delivery costs and PO Box addresses.

SolutionLeveraged our partnership with Next to achieve favourable rates.

Operate on break-even basis for delivery costs.

Costs based on volumetrics – introduced smaller bag

PO Box address issue unsolved as yet

12

Challenges Faced

Challenge 5Limited tactical eCRM promotion due to margin erosion.

SolutionAgreed with business to have one ‘Overseas Exclusive’ email per month.

Resulted in some of our best sales days.

15

The Future

We undertook full macro analysis of potential markets.

Decided to open up delivery to Australia, Canada, Switzerland and Croatia on .com website.

Local market opportunities as well as Expats.

Research revealed some local market ‘quirks’ to be addressed e.g. Canadian Ecommerce.

Internationalise the website.

Customs considerations for non EU countries.

16

Closer to Home: The Expat Market

Expat customers are nice to have...but harder to find.

More cautious approach, but a good way to test a market with low investment and low risk.