Have you made your mark on the German market? Then it's time to set your sights on Austria and Switzerland. Expanding into these two countries will give you access to the large German-speaking market in Central Europe. However, there are language and cultural differences. With a few optimizations, you'll be ready for expansion and address these markets effectively.
Leverage your position in Germany and expand
When you start selling online in Germany, it may also make sense to sell cross-border in Austria and Switzerland at the same time. Since many residents of Austria and Switzerland speak German, it is relatively easy to enter these markets if you already have a German webshop. This allows you to take advantage of the growing e-commerce markets in Austria (with a 20% growth rate) and Switzerland (with a 10% growth rate), further expanding your sales market. In 2020, only 20% of Austrian merchants were active online, which means there is still a lot of room for growth.
Optimizing your website for relevant German keywords will improve your visibility in both Austria and Switzerland through organic search results throughout the DACH region. However, when local online shops are available, consumers often prefer to store within their own country because of advantages such as faster delivery, better prices and lower shipping costs. Capitalizing on this makes your market approach really effective.
Language nuances Between the Alps
Austria, with its picturesque alps and rich culture, is home to about 8.9 million inhabitants, the vast majority of whom speak Austrian German. This variety is similar to Standard German in many ways, but with subtle differences that give it its own charm. On the other hand, multicultural Switzerland offers a melting pot of languages. Although the country has four official languages, German, particularly the unique Schweizerdeutsch, is the dominant language and is spoken by about 63% of the population. About 4.5 million people in Switzerland speak German; French, Italian and Rhaeto-Romanic are also spoken. German is mainly spoken in northern and eastern Switzerland, while French is spoken in the west and Italian is spoken in the south. Rhaeto-Romanic is a minority language spoken in the canton of Graubünden.
Localization tweaks
For a true Austrian or Swiss online shopping experience, it is good to make some tweaks. For example, the German button "kaufen" should become "order" in Austria. Furthermore, the Ringel-s (ß) will be replaced by a double s (ss) in Switzerland. For 49% of Austrian consumers, secure payment methods are the deciding factor in making an online purchase. Credit cards and post-payment on account are seen as secure, and 2FA on payment is viewed positively by 95% of consumers. Furthermore, 63% of Austrians are willing to pay more if an order is delivered the same day, and 77% drop out if shipping costs are too high.
Of course, VAT also differs, this is 20% in Austria and 7.7% in Switzerland, instead of 19% in Germany. In Austria, EPS is the most popular payment method. Due to PostFinance's market dominance, 53% of consumers in Switzerland pay by bank transfer. Furthermore, Swiss Post provides very fast cross-border delivery times. As for the delivery itself, sustainability is highly valued in Switzerland: The most valued sustainable shipping method is consolidated shipment, followed by CO2 offsetting. In addition, the most important factor in lowering the purchase threshold is the availability of information about a product's origin.
Success example expansion Austria
DroneFlight Academy successfully introduced drone training programs to German-speaking markets. However, when the company entered the Austrian market, the marketing campaigns did not prove immediately successful. It quickly became clear that targeting and keywords in the Austrian market required different settings. Simply copying the strategies used in other German-speaking regions was not enough.
Comparing conversion rates across countries and learning from them proves essential. To address this, DroneFlight Academy chose to launch targeted marketing campaigns for Austria. This optimized approach, taking into account the unique nuances of the Austrian market, significantly improved results.
Greater reach through marketplaces
Selling through marketplaces also offers opportunities. Amazon has a similar dominant position in Austria as it does in Germany. You basically sell through Amazon.de. "You then have to set up in your Amazon seller centrally that you also deliver to Austrian zip codes or sell via Fulfilment by Amazon (FBA). In the latter case, don't forget to apply for a VAT number," advises Paul Kleinherenbrink Marketplace specialist at Dexport. OTTO is active in Austria with Ottoversand.at, though less dominant in Austria than in Germany. In Switzerland, the situation is slightly different. Here Zalando takes the top position, followed by local toppers digitec.ch and galaxus.ch, which together form a kind of NV. Galaxus even grew by 42%. Amazon only comes fourth in Switzerland. Unlike in Germany and Austria, OTTO is not a major player and does not even enter the top 50 largest B2C shops in Switzerland. Furthermore, Chinese online shops are also a lot less popular there.
The right online marketing strategy
With a German webshop, you are already laying a solid foundation for cross-border activities. But don't forget that every market is unique. Understanding the nuances of Austrian and Swiss consumers and their preferences will help you refine your e-commerce approach and position your brand for growth. A next step in expanding your reach is to compare conversion rates and average order value by country are. Based on this, you can decide to increase the budget for successful campaigns in different countries if they perform well.
