How FedEx Is Commerce-Enabling The World

Explore this investment 05.06.16

The data doesn’t lie.

Cross-border commerce is a $1 trillion source of incremental revenue for merchants. But it’s also an opportunity that most of them are ill-prepared to benefit from.

The last quarterly update of the PYMNTS X-Border Payments Optimization Index shows that most merchants barely get a passing grade when it comes to being open to a cross-border shopper. Inability to support multiple languages, currencies and transparency on the final cost of the product turn shoppers off. And that leaves a pile of money on the floor for those merchants. The leakage as a result of not being able to convert those buyers to shoppers collectively costs retailers more than $150 billion every year.

Both of those problems were very in the crosshairs of FedEx.

With consumer reach in more than 200 countries and territories and a cross-border eCommerce solution that will accept over 80 currencies and support 15 payment options, FedEx knows a thing or two about the power of cross-border commerce. What they also sensed is how much more potential online merchants might be able to capture if they were given a chance to optimize their checkout conversions.

Chip Hull, VP of FedEx CrossBorder, recently explained that: “Only about one-third of U.S.-based global eCommerce sites accept foreign currencies, and research tells us that customers are more likely to abandon shopping carts that only show U.S. dollar pricing.”

FedEx CrossBorder, the recently rebranded BONGO business unit, is all about helping merchants make the most of the cross-border opportunity – and to enable payment for goods purchased while staying on the right side of fraud, risk, tax, and regulatory and legal compliance.

Hull says that it’s easy to pigeonhole FedEx into a transportation and logistics box that’s about moving products from one country to another – quickly and reliably. FedEx CrossBorder is an end-to-end platform that plugs into merchant websites to remove the friction when a cross-border service is needed. Once a consumer selects a country outside of the HQ of the merchant, FedEx CrossBorder takes over.

Literally. They become the merchant/exporter of record, taking on all of the risk associated with that transaction, including fraud and compliance.

And since cross-border transactions historically have a much higher fraud rate than domestic transactions, Hull said FedEx CrossBorder takes a huge burden off of merchants that might like to serve a cross-border customer but don’t feel equipped to handle the risk.

“The art is to make [cross-border] the equivalent of a domestic transaction in terms of fraud, while still keeping those conversion rates pretty high,” Hull explained.

How FedEx CrossBorder Works

FedEx CrossBorder recently partnered with BlueSnap to help deliver that experience for its merchants. FedEx’s eCommerce technology solutions platform is leveraging BlueSnap’s Powered Buy platform to facilitate cross-border transactions for these online merchants by ensuring local languages and currencies are supported and that consumers are provided with a wide variety of payment options to find what works best for them.

BlueSnap’s PoweredBuy platform bakes in a variety of capabilities that help FedEx maximize conversions at checkout.

With the support of multiple currencies and languages, local payments methods and mobile wallets, fraud detection, payments routing and failovers, as well as being able to optimize that experience for someone shopping cross-border and on a mobile device.

Hull said some of the companies that approach them are not doing any international business today but aspire to do so, while some are already active in cross-border but may need some support. Either way, FedEx CrossBorder is fully equipped to, as Hull describes, displace the traditional online shopping cart.


The digital shopping cart has quickly become a complicated space.

So much so that the notion of a “cart’ may soon be an old concept. Not only are shoppers better equipped to make purchases whenever and wherever they want using mobile devices, but the channels and methods by which they engage with merchants is rapidly changing as well.

Social media platforms in particular, such as Facebook, Pinterest and Snapchat, are making it quicker and easier than ever for consumers to simply see something and buy it. Consumers can buy from ads and from videos, and inside of messages on messaging platforms.

As Hull made it clear, “the days of the shopping cart are probably numbered.”

But all this convenience (and disruption) for online shopping carts is not without pain points and friction. It’s the payment part that gets in the way.

When it comes to cross-border, sometimes even the smallest changes can make the biggest difference in providing a better customer experience, Hull says. From offering the right payment methods to transparency when it comes to how much things will actually cost after shipping, taxes and currency conversion can make all the difference between making a sale and an abandoned shopping cart.

Solving friction during checkout can often feel like the whack-a-mole game — as soon as one problem is taken care of, another one pops right up someplace else.

Hull said that “as the technology evolves and the capabilities evolve, the ability to address some of those friction points have to evolve too,” noting that for cross-border transactions, payment types, currency types and language contribute heavily to cart abandonment.

When it comes to supporting a preferred language, Hull added that “it’s not enough just to have the cart be in a local language but the site needs to be in that same local language if you’re really going to drive the experience that you need.”

Returns also pose a significant challenge in the cross-border space.

Not only is it expensive to facilitate returns, but when trying to do that globally merchants face additional challenges such as dealing with customs and the time it takes to get items back to where they came from.

Hull said FedEx’s recent acquisition of GENCO has developed reverse logistics solutions that are unique to the cross-border space, making it both easier and more affordable for its merchant partners.


Any merchant online is a merchant that is open for cross-border business, since they can be found by anyone with access to a browser and the Internet.

“If they’re not dealing with international today, they’re going to be in the very near future if nothing else than from a defensive standpoint from offshore sites,” Hull said, emphasizing that domestic merchants must consider how to address the cross-border momentum, especially with more European and Asian sites looking to expand their reach into the U.S. market.

Cross-border isn’t just about catering to a customer that is looking to buy from somewhere other than her local market, but about staying competitive as the world of commerce grows ever flatter.

FedEx CrossBorder’s offering hopes to solve for the complexities that come with making the shift to cross-border – democratizing the ability for both small and large merchants to offer great service to global customers – and putting numbers to the opportunity.

All that a merchant needs to do to size up the cross-border opportunity is visit FedEx’s CrossBorder website. There, they can enter the number of visitors that visit their own sites with non-U.S. IP addresses. FedEx will return an estimate of what their likely revenue streams might be based on their industry.

“What most merchants will see is a significantly higher revenue per unique visitor coming from those international IP addresses than they see from domestic IP addresses,” Hull said.

But only if they can covert those visitors to buyers. That’s where they can visit the BlueSnap site and walk through (in less than 5 minutes) the Checkout Conversion Calculator. That will provide an estimate of how optimized – or not – they are to see those sales hit their bottom line.

Together, merchants will be armed to serve a customer that’s willing and able to buy and to pay – and often without price concessions.

“When you marry our capabilities together with that broad range of transportation solutions, it really gives a very powerful capability for our customers,” Hull noted.