Avangate Releases First Digital Commerce Benchmark To Track Global Commerce Trends

Shift in Consumption of Digital Services Mirrors Economic, Legislative Climates Creating Opportunities for Digital Service Providers

Redwood City, CA. - October 22, 2015 - Avangate, the modern digital commerce solution provider trusted by thousands of software, SaaS and online services companies to grow their business worldwide, today released findings from its first Digital Commerce Benchmark. The new report tracks global consumption of digital services to identify regions with the fastest growth and greatest contraction. Careful analysis of the data and correlation with external factors provides actionable insight for clients and digital services providers to help direct their efforts.

"Our mission is to support and stimulate global commerce for digital services from global payment processing, tax and compliance to automated billing, renewal and customer engagement," said Michael Ni, CMO and SVP of Products at Avangate. "We believe that by identifying patterns and drawing correlations from the data to current events, we can help our clients make smart decisions that deepen relationships with existing customers and extend services where new opportunities arise."

The Delicate Balance of Online Services & Global Economic Indicators

In the global digital services economy, recurring revenue and subscription models are the gateway to profitability. It is imperative that companies provide seamless customer experiences-offering multiple payment options and personalized marketing touchpoints, and complying with local regulations is fundamental. Because online services can be turned on and off instantaneously by a customer, they act as real-time indicators into buyer behavior and tend to reflect the overall health of global markets. Understanding these patterns gives online services companies the opportunity to redirect efforts to different regions or double down on campaigns where the opportunity is emerging. With the right platform in place, digital services can be delivered quickly to new regions and campaigns can be adjusted in real time as the environment changes.

Avangate is able to continuously track and benchmark these changes, empowering business decision makers to adjust their strategies based on the rise and fall of online services' consumption globally. By correlating the data with sociopolitical and economic factors that are happening in various regions, businesses have a better gauge on what markets are surging or trailing. The ability to extend online services to a region that is surging and adjust marketing efforts for new opportunities, as well as shift resources from regions that are contracting, becomes a critical competitive advantage.

Key Findings from the Avangate Digital Commerce Benchmark

• Regions on the Rise: Kuwait, Vietnam, Slovenia, Pakistan, Saudi Arabia and India are seeing the most digital growth, with positive increases in buyer purchasing from Q2-Q3 2015. One of the countries that showed consistent growth, Vietnam, may be directly tied to its booming tech scene, which has been reported as the nation's most successful private industry.
• Regions Experiencing Contraction: The regions with the slowest growth are Kazakhstan, Serbia, Namibia, Greece, Ecuador and China. While Greece is still in the negative, the data may be an indicator of positive change: After dropping significantly at the top of Q3, Greece saw a 56 percent increase in purchases during August 2015. China also saw a slight surge of seven percent during this time period, likely due to interest cut rates employed by banks.

Avangate's data reveals there is no central commerce region that is experiencing the most success. When attempting to go global or target new markets, companies should avoid targeting a broad area, such as Latin America or Europe, and instead, they should look at the discrete regions or countries that have the most opportunities, such as Vietnam and India, and adjust their global spend strategies.

Breaking into Emerging and Global Markets

It is evident from this data that the opportunity for online commerce is fluid across the globe. In addition to tracking the rise and fall of specific markets, online service providers should ensure they're supporting a strong foundation for digital commerce, regardless of the market they're targeting.

• Compliance: Vietnam and Russia, like the European Union, have recently enacted laws and regulations around software purchasing and data locations that can be a headache for buyers and sellers alike, adding compliance hurdles for vendors seeking to expand their operations. Leveraging solutions like Avangate, a global merchant that is already compliant with international privacy laws and regulations, can address this issue as well as any abrupt changes. When all Greek bankcards were placed on hold, Avangate immediately restricted purchases made with Greek cards, avoiding blocked transactions and dropped purchases.
• Payment Processing and Regulations: Payment regulation changes, like changes in value add tax (VAT) in Europe, also have had an impact. Prior to the change, U.S. businesses could set up one ecommerce supply platform in Europe for all its European business, avoiding areas with high taxes. However, a new rule taxes the sale of digital services at the VAT rate of the country in which the consumer is located. Avangate's global tax engine enables collection irrespective of location.

For more insight into Avangate's Digital Commerce Benchmark, please visit the infographic Avangate's Digital Commerce Benchmark infographic.

Benchmark Methodology

Avangate's Digital Commerce Benchmark is based on a sample of all worldwide transactions moving through the Avangate platform between April-September 2015.