> Lacklustre cross border commerce is among the reasons why successful companies in one European country have trouble scaling up and competing with American giants who by default start in a market with over 300M people.
While it would be nice to get the VAT problems sorted out, this is second to the problem of there being a couple dozen different languages being used in the EU. People shop domestically because they can use websites in their native language and when they have problems, can talk to customer service representatives in a language they understand.
It is really, really hard to get your service localized in couple dozen different languages (let alone provide actual customer service in all of them).
Even Amazon handles only a part of Europe, and if Amazon can't do that, what companies can? There are a few, but not all that many, and for many it isn't worth it, because your economies of scale quickly disappear when you have to build and maintain a separate presence in up to 28 different countries that mostly speak different languages. (That includes American companies, too, by the way, many of which simply choose to ignore Estonia or even Sweden and Portugal.)
If the problem was the need to maintain a specific presence, then they would let me use the english language version of the website. But they don't. I'm tired of "This content isn't available in your country" and "we can't ship x item to your country" messages...
Is website language localization really what's keeping e-commerce from taking off in Europe?? Having only 4-5 languages seems to cover most of the population, no?
Also, many of these people in these countries speak several languages already because of the close proximity and business with each other.
It's not just website language localization. It's having customer service that actually speaks the language. That's not impossible (Netherlands-based Booking.com supports a ton of different language), but online retail is a low margin business, and for most multinational businesses it is simpler to let the locals deal with the retail aspect. It works for Philips and Bosch, after all.
You can get away without offering this for some types of products and services, but remember that you are competing with local vendors who do.
And yes, of course, there are other issues, such as shipping overhead (for anything that involves physical products) and payment method preferences. But language on its own is already a significant obstacle towards exploiting economies of scale beyond the national level.
While it would be nice to get the VAT problems sorted out, this is second to the problem of there being a couple dozen different languages being used in the EU. People shop domestically because they can use websites in their native language and when they have problems, can talk to customer service representatives in a language they understand.
It is really, really hard to get your service localized in couple dozen different languages (let alone provide actual customer service in all of them).
Even Amazon handles only a part of Europe, and if Amazon can't do that, what companies can? There are a few, but not all that many, and for many it isn't worth it, because your economies of scale quickly disappear when you have to build and maintain a separate presence in up to 28 different countries that mostly speak different languages. (That includes American companies, too, by the way, many of which simply choose to ignore Estonia or even Sweden and Portugal.)