The 7 Pillars of International Export

Digital export

Implementing a digital internationalisation project is a complex process that cannot be underestimated and requires adequate planning of activities.
First of all, it must be considered that, since it is an investment, time, resources, willingness to change and preparation are required with respect to a number of fundamental variables. Among these, the first is certainly the selection of one or more target markets.

Destination countries are usually chosen on the basis of their attractiveness, which can be defined according to several criteria. Some companies, for example, let themselves be guided by the success and development potential of the online channel by selecting the most promising countries from this point of view; others favour cultural similarity or proximity to the markets already covered; still others prioritise the assessment of market accessibility in terms of regulations or standards to be met.

Whichever criterion is chosen, therefore, whether one opts for a relatively close market or a distant one, an arguably even greater challenge remains to be met. The second activity essential to the concrete activation of a digital presence abroad is, in fact, the identification and subsequent implementation of the export model best suited to one's own business reality. I export models constitute the set of choices that the company makes with reference to a series of aspects that, due to their importance, could be defined as 'pillars' of an export strategy.

Commercial channels

The first pillar concerns sales channels. These represent the sales channels through which the company's products are conveyed to customers.
As part of an online internationalisation process, there are a number of digital alternatives including:

• online retailers: Retailers are trading companies that distribute goods directly to end consumers, i.e. by holding ownership of goods purchased from Italian manufacturers. In reaching final consumers, retailers may use e-commerce sites exclusively (in which case we speak of pure online retailers) or they may combine some physical shops with digital initiatives (multi-channel retailers). An Italian company that decides to sell abroad through an online retailer can basically opt for two alternatives. The first is to sell abroad through an Italian retailer, the second is to opt for a foreign retailer with a domain directly in the target country or in a third country; 
• marketplace: marketplaces are online trading companies that are able to aggregate a typically very fragmented offer without assuming the risk of unsold goods (i.e. they do not acquire ownership of the goods) but play a pure intermediation role; 
• private sales sites or 'flash sales': private sales sites are online trading companies that propose a selection of the offer of typically well-known manufacturers or brands and organise sales campaigns lasting up to 4/5 days at heavily discounted prices, without assuming the risk of unsold products (they buy products on the basis of orders collected from customers). In some countries, this sales channel is very popular as it represents an opportunity to approach products that would normally be much less accessible; 
• own e-commerce sites: are the e-commerce sites developed directly by manufacturers who want to sell their products abroad. 

Selecting the online sales channel to be used to target a certain market is a complex choice that requires first and foremost a knowledge of the target e-commerce market. If, for instance, the online scenario is highly concentrated, and dominated by local players, and significantly competitive, the exclusive use of one's own site may not be very effective.

Logistics

The second pillar concerns the logistical channels, i.e. the solutions by which products can be physically distributed in a given market. In order to define the alternatives, several aspects must be considered, including the configuration of the distribution network, the mode of transport, the level of outsourcing of activities, and the level of service required. 

The selection of one solution over the other depends, for example, on the value of the product, the expected volumes, the level of service required, and regulatory/customs complexities or constraints. In general, factors in favour of a solution with relocated stock in one or more warehouses in the target market are a particularly stringent service level, a low value of goods, and high volumes. Conversely, the more the order-delivery cycle time is not a constraint, the higher the value of the product and the lower the volumes, the more preferable it may be to serve the target market from a warehouse in the country of origin.  

Digital marketing

The third pillar is the marketing and communication. These are the digital tools through which a company promotes its brands and/or products in its target market.
Developing marketing and communication campaigns in a different, perhaps culturally distant market implies additional difficulties in choosing the right mix of channels to use. One has to deal with the identification of tones, themes and content consistent with the tastes of the market, which are often difficult to understand by professionals of a different nationality from that of the target country.
This is the case, for example, in China, which is often inaccessible to Western companies without the intermediation of local experts.

Organisation

The fourth aspect to consider is related to theadaptation of the organisational structure. Organisational change can be a critical phase in the life of the enterprise trying to move towards digital export.
The situation or stage with the least specialisation is the one in which there is neither an export manager nor an e-commerce manager. The company organisation can therefore evolve in two complementary directions: on the one hand with the figure of thetraditional export manageror specialised in offline export, on the other hand with the figure of thee-commerce managernot necessarily also oriented towards the foreign market.
However, an effective digital export strategy requires that the two coincide or work together with a high degree of coordination.

Financing

The fifth pillar concerns the sources of funding. Export, including digital export, is primarily an opportunity to increase profits abroad. If the export initiative is successful, it will be able to sustain itself in the medium to long term. However, entering foreign markets entails a number of upfront costs for the company, which, in addition to being an obstacle to internationalisation, increase the uncertainty and riskiness of the operation.
The ability to find and manage sources of finance thus becomes a prerequisite for seizing the opportunities provided by exports. In some cases, the enterprise is able to finance itself in whole or in part. In most cases, however, the enterprise needs external resources, including private debt capital, private financing, or public financing specifically related to the use of digital.

Payment Systems

The sixth pillar is the payment systemsThe payment system, i.e. the set of procedures and means by which money is transferred between buyer and seller online. A payment system that is overly complex, opaque or simply far removed from the payment habits of consumers risks jeopardising the success of a digital purchase. 
There are various payment instruments, ranging from the most standard, such as credit/debit cards, to the recent "wallet"digital. Each of these payment instruments may be more or less suitable depending on the type of consumer, the target market and the product offered. 
In particular, much attention must be paid to the specific target market, as each country has its own peculiarities in this regard, and it would be reductive to think that a credit card is sufficient as the sole means of payment.

Legal Aspects

The last pillar concerns the legal aspects. Digital exporting requires an understanding of the legal and tax procedures and requirements, customs requirements, regulations and contractual rules to be followed when selling online in foreign markets.
Some of the most important legal aspects concern the initial requirements, the pre-contractual phase, the conclusion of the contract, privacy protection, delivery, post-sale aspects and regulations on the resolution of any legal disputes. In this case it is advisable to rely on experts, typically specialised law firms.
The internalisation of these skills is only conceivable for companies with such significant export volumes to justify the cost-benefit ratio.

Defined the pillars of the Export modelIt is important to emphasise that the application of the model is influenced by several contextual factors, including the country of destination and the commodity sector. Finally, it must be considered that there are no universal rules, but it is the individual company that must customise the export model and make it fit its own reality.