Revealed: 4 essential tips for cracking the German ecommerce market
All eyes on Germany
This year, Drapers declared Germany the ‘priority growth market’ for ambitious ecomm advertisers, particularly fashion brands that are keen to expand globally, such as Nest client Ted Baker.
The opportunity here is huge – not only because of Germany’s position as the largest nation in Europe – but also because there has been a huge behavioural shift towards ecommerce recently within the country, with 43% of respondents in a Bitkom survey stating that they have been buying more online since the start of the pandemic.
And that means that now is a great time to expand into Germany. Some of Nest’s fastest-growing brands have succeeded by scaling up in the EU – and having a clear strategy for the lucrative German market is key for this. Still, this market is notoriously challenging to enter into.
Succeeding where many fail
Some of the most dominant global brands – including the world’s largest retailer Walmart – have failed to expand into Germany as a new market, as a result of applying unmodified marketing strategies that worked in their domestic market, rather than considering a localised approach.
Within the fashion sector, companies of all sizes, from Gap to Ganni, have also seen difficulties cracking Germany. Due to a number of cultural factors, the German market requires more localisation than many other similar economic powers – and it takes a lot more than just translating your copy into German. Brands that fail to adapt to the tastes of the market are often the ones that fail.
At Nest, 80% of our clients are focused on winning customers within Germany, and we have a proven, localised approach. For example, menswear brand SPOKE initially struggled in the German market but employing Nest’s proprietary strategy resulted in a turnaround in performance with a 60% drop in CPA.
Time and time again we see brands making the same mistakes when entering this market. We’ll explain how to avoid these common pitfalls with four essential tips.
1. Substance over style
Broadly, resonating with German consumers requires advertising focused on product features and factual statements. Whilst American copy takes a lighthearted tone, relying on imagery to tell a story, Germans require reliable information and authentic content to trust a brand. For example, user-generated content on social media repurposed into paid social ads resonates particularly well in terms of authenticity.
2. Transparency is critical
Establishing pricing at the beginning of the customer journey is key, as the German market is incredibly price-sensitive. Logistics costs are equally important, as Germans are known to have the highest returns rates in Europe. Providing detail on shipping and offering free returns will likely increase conversion rates.
3. Payment methods must be varied
In a country known for being risk-averse, offering multiple payment options is essential, as this aligns with consumer expectations. Services such as PayPal and paying by invoice dominate as the preferred payment methods in Germany, whilst credit cards remain less popular. Investing in BNPL schemes, albeit still in their infancy, could present a strong opportunity for those looking to market here, as their resemblance to the invoicing method already lends well to the German consumer.
4. Localisation is a must
Accurate translations are paramount in cross-border advertising. In this market particularly, native copy must be used and portray the correct tone – direct translations often don’t resonate. Additionally, ensure your website is customised to the German consumer with the correct currency and size measurements.
Marketing in Germany undoubtedly has huge potential, but failing to adapt for the German consumer means that many brands get caught out. However, getting these nuances right can help unlock potential in this core market, as a stepping stone to global success.