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Radosław Opałko, Media4U:
It’s my great pleasure to welcome you all today to the Media4U headquarters in Łódź. My name is Radek Opałko, and at Media4U, I am responsible for sales and international expansion. Today, we are meeting to discuss a bit about cross-border. We’ll discuss it from two perspectives. On the one hand, from the perspective of a manager who deals daily with introducing a brand to foreign markets, and on the other hand, from the perspective of an expert who helps various organizations with international expansion. So, I am very pleased to welcome my esteemed guests, Dagmara Ollesz-Miącz.
Dagmara Ollesz-Miącz, TATUUM:
Hello, good morning.
Radosław Opałko, Media4U:
Director of e-commerce at TATUUM, a brand that sells online in over 20 countries. Right. And Olga Pijanowska, cross-border manager, e-commerce manager at Makes You Local, a company that specializes in introducing brands to foreign markets, and an expert from the Chamber of Electronic Economy, and the head of the Cross-Border Group.
Olga Pijanowska, MakesYouLocal:
That’s correct. Good morning, it’s a pleasure to be here.
Radosław Opałko, Media4U:
I’m out of breath [laughs]. Ladies, first of all, thank you very much for managing to come here in person despite your busy schedules. We are breaking the post-pandemic pattern of meetings, the camera, the monitor. So, my respect. Moving on to the essence – Cross-border or international trade, it’s a term that has been highly trending lately. It’s becoming a more natural direction for Polish companies due to the stagnation on our market, related to various aspects like inflation, the war in Ukraine, and others. According to the Chamber of Electronic Economy report, over 60% of the surveyed companies declare their intention to take their goods beyond the country’s borders.
So, I have a question at the outset because every manager now faces this aspect, what to pay attention to, how to prepare for it, what aspects, what criteria to consider. So, I would like you to talk a bit about how it looks from your side. Maybe Olga, you can start.
Olga Pijanowska, MakesYouLocal:
Once again, I warmly welcome everyone and thank you for the invitation. Very often, when I meet with companies planning expansion, I show them a chart that aims to visualize the path they should take before starting sales in foreign markets. The first element is the decision, so in my opinion, it is really the most important to make the right decision, to consider whether we are ready for this expansion. Are we ready? Here you need to answer yourself, do we feel stable enough in the domestic market and can we afford further investments, thus further development?
Deciding on which market to choose is a bit more complicated, as there are many possibilities, just as there are many countries in the world. We have some hints. Maybe we are already receiving some orders from abroad, so we should check if they are native residents or the Polish community living in that country.And when we get closer to the target country, of course, we should research potential competition that we will compete with, check their payment methods, delivery options, how they promote themselves. Naturally, also get to know our future customers, check their shopping tendencies. All this to ensure fewer surprises when we launch the store in this new market.
Radosław Opałko, Media4U:
But I know there are different approaches. Gradual expansion or entering several markets at once. Who is it for? Can you give some advice to managers who might be listening to us?
Olga Pijanowska, MakesYouLocal:
I usually recommend starting with one country, especially if we have no experience. If it’s the first country, maybe it’s better to start with a less demanding, cheaper one, because we will certainly make mistakes, and these mistakes will cost us less if we choose a less demanding market. I often encounter companies without experience thinking about expanding to the German market. I then check if they realize how demanding that country is. Marketing alone, Google Ads are two or three times more expensive, with significant competition and the strong position of Amazon, so perhaps it’s better to choose a smaller country for the first market. Go through the entire process and once we gain experience, then potentially return to a more demanding country like the Scandinavian markets or Germany. So, answering your question, it all depends on how we feel, what capabilities we have, whether we are working with someone who will help us or if we want to handle everything ourselves.
Radosław Opałko, Media4U:
The term Amazon came up, which naturally raises a question for me because we can think of the expansion strategy in various ways. Some do it through marketplaces, others immediately decide on their own store. What would you suggest, for whom, in what situation, what is your opinion on this topic?
Olga Pijanowska, MakesYouLocal:
Unfortunately, there is no straightforward answer. Everything needs to be analyzed individually based on what assortment we sell and also to which country we want to go. Mentioned Germany, Amazon is very strong there, so if we determine that it is more of a product, a category that matches Amazon’s offer, maybe we should enter the German market through a marketplace. In Romania or the Baltic countries, it might be enough with our own store. So, unfortunately, I cannot give a definite answer now. Everything must be checked individually.
Radosław Opałko, Media4U:
Yes, because there are many aspects to consider. Shipping, logistics, segment, whether it’s drop shipping or not, so many aspects must be considered when planning such an activity.
Olga Pijanowska, MakesYouLocal:
Yes, additionally, we have stores of manufacturers offering large items, so in this case, I would start the analysis by checking potential partners who provide logistics services because this will be crucial. For smaller shipments, it may not matter as much if we are talking about neighboring countries.
Radosław Opałko, Media4U:
Yes, as far as I know, there are aspects to consider that in some countries, for example, shipping disqualifies if it doesn’t arrive within 24 hours. And I think this should all be considered when planning such an operation.
Olga Pijanowska, MakesYouLocal:
Absolutely, that’s why it’s best to research potential competition, check how they do it, what their delivery times are, what payments they offer, and answer whether we can match them.
Radosław Opałko, Media4U:
Sounds like a significant analysis, probably quite time-consuming.
Olga Pijanowska, MakesYouLocal:
Yes, that’s why if we can’t answer all these questions ourselves, we should devote more time to this analysis because it’s crucial. Maybe we should seek help from experts. As Makes You Local, we also prepare a so-called market scan, which is very helpful, but also as part of free consultations, having colleagues working daily from our local offices, I can answer many of these initial questions.
Radosław Opałko, Media4U:
Sure, well, if you don’t feel that you have the power or competence, it’s good to seek advice from such experts. And I’ll direct the question to Dagmara because, as I mentioned, you are already in over 20 markets. How did it look for you? What decided that you initially chose those specific markets and then successively added more?
Dagmara Ollesz-Miącz, TATUUM:
It varies greatly, considering we sell abroad through our e-shop and marketplaces. My personal adventure with cross-border sales started two years ago, shortly after the pandemic, and I really took my time deciding which country would be first on my list. I started by considering the resources we already have within the organization to minimize potential costs and risks, and to make it as safe and rational as possible, without requiring a massive investment, but rather as a test and process. So, of course, Germany tempted us, and I checked how feasible it was. But as Olga said, the verification of marketing costs in the fashion industry, including returns, which are significant, as the German market has a high return rate. So, deep analysis, preparing a budget comparison between different markets, led us to the Czech market, especially since we operate in an omnichannel model. We already had stores in the Czech market, so I saw it as an advantage and support in entering a market where we are not entirely anonymous but are already building our position and brand recognition.
Radosław Opałko, Media4U:
Yes, I read about cases where many companies found that the return policy wasn’t adequately analyzed, and the cost of reshipping and theoretically free returns could completely derail the business plan of such a venture. So, I understand that perfectly. Out of curiosity, could you share your experiences? Do you have a country that turned out to be a pleasant surprise for you? Or, on the contrary, despite some forecasts and analyses, something went much worse? Could you share a bit?
Dagmara Ollesz-Miącz, TATUUM:
The Czech Republic is a pleasant surprise because the beginnings of our expansion were very difficult. I set specific sales and margin goals, and it wasn’t like we opened up to the market, started marketing activities, and suddenly everything exploded with success. It took several months to understand what we needed to improve, what we needed to do, the significant impact of organic positioning, and that it is indeed a process, not an immediate game changer.
The Romanian market is definitely a challenge for me. I think it has enormous potential, and I absolutely do not give up. However, it is a market that requires deep analysis from us because we are not achieving the goals I set. We have some technical elements that limit us, so we have a plan to improve, but I see very significant differences when comparing the Czech Republic, Slovakia, and Romania, where consumer behaviors and customer expectations are completely different.
Radosław Opałko, Media4U:
Yes, because often there are specific aspects of a country. From what I know, listening to various expert opinions, Romanians are unique, with their own Valentine’s Day, different shopping models for Black Friday, and so on. I think it all needs to be analyzed. Very strong position of eMAG, which is the dominant marketplace there, and you need to think deeply whether to go through eMAG or with your own store. The word process came up here, and I would like to pursue this topic. The word localization often means different things. Can you explain how the process looks like, why localization is not just about translation?
Olga Pijanowska, MakesYouLocal:
Before answering your question, I’ll refer to what Dagmara said. The Czech Republic is probably the second most popular direction after the German market, and it’s great that you are doing so well because few people know that the Czech Republic has over 55,000 online stores. So, even though it’s a close market, and consumers seem similar to Polish consumers, competition is enormous because Poland has the same number of stores, even though we are several times bigger.
Romania is challenging, with payment on delivery being a big trend there, and people often order several similar products from different stores and only pick up one package. So, we need to think about reliable return services or having a partner who can help us with that. Localization is the process of adapting a store to the needs and conditions of a given market and its e-commerce culture. Localization is often confused with translation.
Translation is more for official documents or technical descriptions, while localization for online stores and websites involves creating a natural feeling. Marketing aspects are more important in localization than in regular translation.We should consider shopping trends in the market, adapting to customer specifics. For instance, language is usually more formal in Germany, less so in the Czech Republic or Slovakia. Localization involves many crucial aspects, and there are many mistakes made at this stage because translating a store one-to-one doesn’t work.
Radosław Opałko, Media4U:
Yes, I’ve seen approaches where people use Google Translate and hope for the best, thinking they’ll change it later. Companies often seek savings, thinking why hire a professional translation agency when they can use chat GPT, DeepL, or Google Translate. But unfortunately, there are consequences. Dagmara, how was it for you? How long does it typically take to incorporate a new country? I know the technical side because we work together on building systems, but how long does the overall process take?
Dagmara Ollesz-Miącz, TATUUM:
It depends on what we are talking about. For me, the biggest challenge was adapting the system and functional, technical, and technological aspects. In terms of translations, organizing logistics, and customer service, it takes about two to three months to organize such a process. The first time is, of course, the hardest, and it took us a bit longer for the Czech market. Now, I think I could enter a new market in two or three months in terms of translations and localization. But remember that entering new markets requires our attention, nothing happens by itself. We will certainly change our strategy and be much bolder now because we have experience and know-how. However, at that time, it was a significant challenge.
Radosław Opałko, Media4U:
Yes, everything depends on the strategy, even in terms of logistics, whether we ship everything from a warehouse in Poland or open local warehouses. All these aspects must be considered.
Dagmara Ollesz-Miącz, TATUUM:
As I said, we have a strategy of foreign expansion through our e-shop and marketplaces. They are very different because the e-shop is a long-term strategy, allowing us to build brand awareness and presence in the market. It’s different on a marketplace where we have limited possibilities to present our brand among competitors. Our optimal model is to run both e-shop and marketplace because it meets our short-term and long-term goals.
Radosław Opałko, Media4U:
Sure, it depends on the market specifics and what works best.
Olga Pijanowska, MakesYouLocal:
Can I ask a question here?
Radosław Opałko, Media4U:
Of course.
Olga Pijanowska, MakesYouLocal:
I am curious if you enter markets simultaneously with the marketplace and your store? Is it a strategy planned earlier, analyzing the market, and you are sure it’s a marketplace market?
Dagmara Ollesz-Miącz, TATUUM:
For us, the marketplace we choose matters, we don’t select one just to be on it. We care about being on marketplaces that position us well and specialize in fashion.
Olga Pijanowska, MakesYouLocal:
So an additional sales channel.
Dagmara Ollesz-Miącz, TATUUM:
Exactly. We went broad in choosing countries on Zalando to diversify risks. It was hard to say immediately which country would be the best, and with our partner’s support, we managed to attack most European markets.
Radosław Opałko, Media4U:
You anticipated my question about risks. How do you analyze risks? What risks do you consider when entering new countries? Can they be grouped, or is each country specific?
Dagmara Ollesz-Miącz, TATUUM:
You can never completely eliminate risks. Every new thing is about stepping out of the comfort zone, which limits growth. We try to minimize risks through good preparation, thorough research, analytics, and budgeting. So far, we haven’t had an experience where a market was so risky or ineffective that we had to exit it. There are markets where we perform much better, and for us, the German market through a marketplace is leading. But there are also markets where the scale isn’t large, but we study how customers behave to prepare new markets for expansion through our e-shop.
Radosław Opałko, Media4U:
So, you haven’t found a market too risky to exit?
Dagmara Ollesz-Miącz, TATUUM:
No.
Radosław Opałko, Media4U:
That’s commendable.
Dagmara Ollesz-Miącz, TATUUM:
It depends on the market and approach. In the German context, we weren’t ready for the e-shop expansion but tested it through the marketplace.
Radosław Opałko, Media4U:
Sure. Let’s talk about common mistakes. Olga, you’ve given presentations on this topic. Could you share some common mistakes and how you helped clients overcome them?
Olga Pijanowska, MakesYouLocal:
Mistakes happen almost always, big or small, at every stage. The most common ones are improper market research and choice, poorly conducted localization, translation errors, not ensuring proper delivery or payment methods, currency issues, and not researching local regulations. These are common mistakes at the beginning when there is no experience. Clients entering their second, third, or tenth market make fewer mistakes. It’s all about practice and experience.
Radosław Opałko, Media4U:
As Dagmara said, the first market is the hardest, and then it gets a bit easier. From a software perspective, the first process is always the hardest, as you need to prepare everything. Subsequent processes are more repeatable. Marketing has come up several times. How do marketing issues look on different markets? Can strategies be copied from the home market or must they be adapted?
Dagmara Ollesz-Miącz, TATUUM:
Initially, we try to transfer our experience from the Polish market to foreign markets. But there is a big difference between e-shops and marketplaces, with different possibilities. For e-shops, we identify channels and traffic sources we specialize in and try to use our knowledge. But it’s never one-to-one. We operate in a different environment, and our actions vary. When a brand is recognizable in the Czech or Slovak market, we can target customers who already know us. But where we are new, we need to inform customers about our products and e-commerce advantages, local payment and delivery options, and local language contact. It requires specific adjustments. Different markets have different marketing preferences. We see a big variation in social media responsiveness and what clients react to. Testing is crucial, and strategies must be adjusted based on customer reactions.
Radosław Opałko, Media4U:
In your case, physical presence helps as you have physical stores in many countries, which likely aids the return policy where customers can return products in stores.
Dagmara Ollesz-Miącz, TATUUM:
Of course. Omnichannel is a strength. It’s easier where we have stores, but we also try where we don’t.
Radosław Opałko, Media4U:
Marketing is followed by analytics. What should be the focus, what shouldn’t be forgotten? How to measure the effectiveness of actions?
Dagmara Ollesz-Miącz, TATUUM:
Analytics differs between e-shops and marketplaces. For e-shops, it focuses on customer behavior, while for marketplaces, it’s about individual products, monitoring rotation and margins. Marketplaces provide fewer consumer behavior insights. Both sales channels require performance analysis to ensure effectiveness.
Radosław Opałko, Media4U:
And Omnichannel helps, showing the interplay between e-shop and physical store performance.
Dagmara Ollesz-Miącz, TATUUM:
Absolutely. It’s part of our strength.
Radosław Opałko, Media4U:
Great. We’ve discussed preparation, process, risks, mistakes, marketing, and analytics. I’ve observed that sometimes a store does everything right initially, has an initial boom, but then struggles to maintain momentum. What to do to sustain growth and stabilize the market position?
Olga Pijanowska, MakesYouLocal:
It’s challenging. We need to constantly monitor competition and the market, and pay attention to local customer service. It’s crucial, especially for new markets, as the first feedback from customers on how they perceive our store and products. Treat customer service not just as a contact channel but as a way to learn what to improve. If we see many inquiries about a specific issue, we should address it internally to reduce problems and focus on generating sales rather than just answering questions.
Radosław Opałko, Media4U:
Another important aspect we didn’t cover is that customer service in many countries must be in the local language, like in France and Germany.
Olga Pijanowska, MakesYouLocal:
Yes, even in Poland. It builds trust if we see a local phone number and can speak in our language. Even in high English proficiency countries like Scandinavia, local language communication is preferred. Often, stores invest in local websites, translations, and marketing but delay local customer service, which is crucial from the start.
Radosław Opałko, Media4U:
Yes, because if customer service is meant to gather feedback, customers won’t be inclined to share opinions unless there’s strong emotional motivation.
Olga Pijanowska, MakesYouLocal:
Exactly. I mentioned a Spanish store entering Poland with automatic translations and English customer service, which affects trust. People would rather buy from Zalando, knowing the delivery and return process is reliable.
Radosław Opałko, Media4U:
Yes, the type of product also matters. Some prefer to buy from the brand’s official store for authenticity. Germans prefer to pay more for certainty of authenticity.
Olga Pijanowska, MakesYouLocal:
Yes, on Zalando or other marketplaces, we find only part of the assortment. Often, new collections are available first in the brand’s store. If I can’t trust the store, I’ll choose a marketplace.
Radosław Opałko, Media4U:
It depends on what we’re looking for. Dagmara, your situation was gradual market entry.
Dagmara Ollesz-Miącz, TATUUM:
We’re continuously growing, scaling our international sales. We still treat it as a learning process. We’re now bolder with more ambitious plans. We think long-term, focusing not just on immediate sales but building our brand image.
Radosław Opałko, Media4U:
Long-term brand awareness building, right?
Dagmara Ollesz-Miącz, TATUUM:
Yes.
Radosław Opałko, Media4U:
Do you feel that the decision to go abroad accelerated the brand’s growth?
Dagmara Ollesz-Miącz, TATUUM:
Definitely.
Radosław Opałko, Media4U:
I expected that answer. I just wanted to confirm [laughs]. To conclude, what lessons can an e-commerce manager learn from participating in such a project?
Dagmara Ollesz-Miącz, TATUUM:
It’s crucial to verify internal resources and find partners who not only provide services but also share market knowledge. No brand is a specialist in everything, so it’s essential to find reliable partners. Networking and discussing with the industry provide valuable information and confidence. We’ve all made mistakes, but it’s possible.
Radosław Opałko, Media4U:
Networking builds contacts that can be useful in other situations.
Dagmara Ollesz-Miącz, TATUUM:
Definitely.
Radosław Opałko, Media4U:
Olga, any tips for managers hesitant about such processes?
Olga Pijanowska, MakesYouLocal:
If they have doubts, they should spend more time preparing for the foreign market, identifying the best market for their products. Answer key questions to avoid surprises. And don’t replicate the domestic market strategy one-to-one because every market and its e-commerce culture is different.
Dagmara Ollesz-Miącz, TATUUM:
And remember, building a business abroad takes time, just like in the domestic market. Be patient.
Radosław Opałko, Media4U:
Patience and confidence. We’re moving past the era of feeling inferior to the West. We’re competitive and sometimes ahead in some aspects. Cross-border isn’t just from Poland to other countries but also into Poland, as it’s becoming an attractive market for foreign companies.
Olga Pijanowska, MakesYouLocal:
Yes, foreign companies find Poland challenging due to our high-quality services, technological advancement, and competitive pricing. It’s easier for Polish companies to expand abroad than for foreign companies to enter Poland.
Radosław Opałko, Media4U:
We’re a developing market. On that optimistic note, we’ll conclude our meeting. We only scratched the surface, and each aspect could be a separate podcast. Thank you for participating, visiting our office, and the insightful discussion. This podcast is a special episode, but our website offers a series “Topic for Today,” where my colleague Iza discusses with various specialists, providing a wealth of knowledge. If you have a company and want to expand internationally, contact me. My details are in the contact section on media4u.pl.
Thank you very much.
Olga Pijanowska, MakesYouLocal:
Thank you very much.
Radosław Opałko, Media4U:
And hopefully, we’ll hear from you again.
Dagmara Ollesz-Miącz, TATUUM:
Thank you for the invitation.
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