What You’ll Learn from This Report:
Read on to discover the lucrative growth opportunities open to US brands in Europe. This report lays out the challenges your business must navigate, provides a breakdown of the biggest domestic market nuances, offers Nest’s guidance on the best strategic entry point to launch in the continent, and much more.
Your key takeaways:
• The EU is the third-largest economy in the world and the UK the sixth-largest, providing ample opportunities for ecommerce brands to resonate with consumers and scale up their revenue
• To enter Europe, US brands must localize their ad creative, brand, and strategy, and offer customers parity across the shopping experience
• Key challenges to overcome include the tweaking of branding and assets for a European audience, stricter privacy requirements, and a sufficient allocation of marketing resources
• Five of Europe’s largest ecommerce markets - the UK, Germany, France, the Netherlands, and Sweden - all contain significant nuances that brands must be ready to meet
• Intentional, international localization is the model expansion approach, with the UK offering US brands the most effective European entry point
• A full-funnel marketing plan, in partnership with a specialist European agency, offers US brands a low-risk, high-reward shortcut to continental success
An Introduction to the Opportunity
Are you a US brand looking to explore, enter, or scale in Europe? Welcome! Or wilkommen, should we say? Or perhaps bienvenue? ¿Bienvenido? Välkommen? Hoş geldin? Witaj? Alos irthate? Or even üdvözöljük?
Europe is one of the largest consumer markets in the world, with ecommerce revenue set to reach US$632.70bn in 2024 and, in Northern Europe specifically, the top region globally for internet use per capita. Aside from minor fluctuations, the continent is highly economically stable and has substantial existing trade ties with the US. It also contains some of the earliest adopters of tech and fashion trends, with 326 million affluent ecommerce customers - almost the number of total US citizens - all regularly shopping online for products and services.
If you can get yourself in front of the right consumers, in the right way, there will almost certainly be a lucrative market for you to explore.
However, when we talk about “cracking” Europe, what we really mean is cracking the customer. Europe isn’t a homogeneous space where all customers behave in the same way - there are very powerful and nuanced cultural differences alongside 24 different languages, and you cannot enter the market thinking “one size fits all.”
This apparent complexity means many American brands hesitate to expand into the continent. But the more insights you have about the market, the softness or strength of the various economies, knowledge of consumer preferences and attitudes (which vary), and the merits and costs of the relative marketing channels, then the greater the chances of success. If you study the terrain, make proper preparations, and identify trusted partners who can help you, Europe is an extremely accessible and achievable avenue for expansion. So, why now?
Firstly, Europe provides a significant opportunity to take your first steps towards internationalization.
If you’ve scaled up in your home market, the EU is the third-largest economy in the world and accounts for one-sixth of global trade. Add in the UK, the world’s sixth-largest economy, and Europe offers an enormous economic arena ripe for exploration. Success on the continent can inject a substantial addition to your income and enable you to potentially expand even further worldwide.
Particularly attractive when evaluating new markets in Europe are the lower advertising costs. According to Nest data, in 2024, American CPM was 165% higher than European CPM, while Google CPC was 36% higher in the US than in Europe. Though people buy more products in the US, the EU’s much cheaper cost of media leads to a 70% lower CPA in 2024. Additionally, traffic costs are far less volatile and less prone to sharp increases during competitive periods.
However, average conversions and AOVs remain lower in Europe, with 55% smaller average basket sizes compared to the US. So, it’s important to calibrate your CPA and ROAS accordingly.
Ultimately, Europe’s advertising landscape is both less saturated and less advanced than the highly competitive US market, creating an opportunity for forward-thinking American brands to stand out. With most ecommerce innovations launched first in the US, you can leverage your early access and expertise to make headway against competitors in Europe.
Recent success stories, such as Nest clients Hims, AG1, and ME+EM have proven that there is a very tangible, lucrative opportunity to diversify to European markets - as long as you have the right skills, processes, and partners in place. Ready for the trip of a lifetime? Let’s get your ticket to European success booked, too.
Advertising in Europe is highly cost effective
Localization Will Lead to the Best Chance of Winning in Europe
Europe may be a very rewarding, receptive market, but you need to do your research before launching your product or service and making any irreversible decisions.
Nest experience suggests that before a US business considers a move into Europe, it must be well established in its home market, with its product and brand enjoying a strong market position. There needs to be a level of maturity to your company to make it worth the risk of going international and absorbing the costs.
“The bare minimum adjustments required for entry are providing customer parity on your delivery proposition, returns processes, and price via an English language website and ads. However, this is only scratching the surface and is unlikely to enable you to scale. To establish yourself in Europe, you need to adapt your ads and online content to the local culture and languages.”
- Luke Jonas, co-founder and CGO at Nest
Carry Out Significant Research
Competitor analysis will be key. Look at USPs, pricing matrices, promotional strategies, and brand interactions so that you can spot opportunities. Identifying these gaps will be crucial to planning creative that cuts through the advertising noise and lands the right messages with potential customers. You may have built up a highly successful business in the US, but prepare for humility when you transition to Europe. Unless your product is unique, your new audience will have multiple alternative options and may not be aware of your brand. Granular research will be crucial to unearthing whether there is a place and appetite for your offer in the market.
You may even need to reevaluate your metrics for success. For instance, a typical US household holds $62,300 in annual expendable income, compared to an average of $41,500 across the EU and $40,800 in the UK. So, if you offer premiumpriced products in America, you might need to drop your prices and lower your margins to gain a foothold in Europe. Fortunately, the CPMs for advertising are so much cheaper that your overall economics could remain similarly high.
“Take your business right back to its beginnings. Go in person to wherever you intend to sell, and spend time speaking to local manufacturers and interviewing potential customers. You need to uncover whether your brand is different and what will make you resonate. This research might feel unscalable and inefficient, particularly to a mature US organization, but you’ll prevent so many pitfalls - from assuming your US creative will work in a European context, to expecting to enjoy the same level of differentiation as you do in America.”
- Preston Rutherford, co-founder at Chubbies Shorts
Review Your Pricing and Payment Strategies
Localization of your website is a key factor to success in Europe. Though many Europeans speak English, they’ll expect you to communicate in their language and style - similar to their domestic vendors - to truly inspire purchase.
Offering multiple payment options, including the ones most favored by the specific country, will lead to fewer abandoned baskets. Consumers across Europe tend to pay via similar methods to the US, including credit and debit cards, Paypal, and Buy Now, Pay Later (BNPL) services. However, some countries - Germany in particular - exhibit important differences, which we’ll explore in detail in a later chapter.
“At first, a lot of US brands entering Europe simply swap their dollar prices into pounds and euros - i.e. $250 to £250. This may seem like an easy win on paper, but pound and euro exchange rates mean it can be an unfair dealand disgruntled social media users may spread the word. Aim to work out a pricing structure that offers parity to all your consumers, while still hooking in your new audience.”
- Matt Booker, founder at COUSIN
Pay Attention to Distribution and Returns
Localization also extends to your logistics infrastructure. It’s good sense not to rush into significant capex investments, such as opening multiple fulfillment centers across Europe. Ask yourself: What are the tolerance levels that your European audiences have? Are they happy to wait for longer shipping times, for example?
The minimum viable process will involve shipping from, and facilitating returns to, US distribution centers. Many brands in Europe offer three to five delivery days as standard, a window that can often be achieved by simply shipping from your US base. Consumer expectations are less demanding than in the US; don’t be afraid to use this to your advantage by investing your resources in other areas of the customer experience.
But note that the ability to pay for speedier shipping and returns is becoming an increasingly key purchase decision metric in advanced ecommerce markets like the UK. Parity may require you to set up a distribution center or hire a 3PL, particularly for products like perfume that aren’t easily freight-ordered into Europe. If you decide to invest in European distribution, Benelux is a popular choice, with a strategic location at the entry to Europe and the continent’s largest port in Rotterdam.
Your shipping location will also impact the taxes and duties that you and your customers pay. If a European consumer buys goods online that are already located in the EU, there are no customs formalities and VAT is included in the final price. However, if you ship your products from the US, customers must pay VAT on their purchases irrespective of the value, and may even have to pay customs duties for goods above €150 and excise duty for specific goods.
Localize Your Creative, Brand and Strategy
The rise of consumer privacy initiatives, the subsequent fall in customer data, and the growing influence of the algorithm all mean that creative has become the single most important optimization advantage within digital marketing. Ads are often a consumer’s first interaction with your brand, so you need to make that moment count.
Navigating cultural differences, from worklife habits to everyday reference points, is paramount to your creative’s success. While your customers in the US and Europe may share similar interests and behaviors, they will often need to be articulated in a different way within your ads and branding. Scaling into Europe won’t often require you to reinvent the wheel with your creative, but simply adapt your concept to ensure that the language is nuanced and the imagery is relevant enough to resonate with a domestic audience.
Localization of your strategy is also fundamental. Review your key communication pillars and identify how they tie to European preferences and behaviors. This process involves a combination of customer research - speaking to consumers, running focus groups, and identifying how they feel about the brand and its positioning - and experimenting with new approaches.
Using hypotheses about your US and European customers, you can run test ads featuring original creative ideas that soon uncover what is and isn’t resonating in Europe. Partnering with a specialist agency allows you to cover both approaches - both incremental creative tweaks and new largerscale ideas that, if successful, could drive significant returns.
An Insight into the Challenges
Hims. Peloton. Lululemon. Three examples of leading North American D2C brands that have successfully crossed the Atlantic, found their niche in Europe, and established themselves as true customer favorites throughout the past decade.
So, let’s explore the main hurdles that often face US brands as they make their first strides into the European market, and how you can overcome them. These brands have followed a well-worn path, joining the ranks of firmly-rooted US businesses that are now so entrenched into European markets, minds, and ways of life that their uncertain early crossovers are a distant memory. And they demonstrate that there will likely be room for your brand, too - as long as you are aware of, and can navigate, the challenges along the way.
Branding and Messaging
“Entering Europe is a delicate balancing act between meeting new audience needs and preserving your core DNA. You need to think about the aspects of your brand that you definitely won’t change vs. where you can be more flexible. The danger is that a US business is perceived completely differently when they go into a new market, because there is clearly something valuable about their brand that is resonating at home. Pureplay brands have a big advantage over omnichannel here, as they can experiment with online adaptations and innovation of their ad creative and brand without risking huge investments or mistakes.”
- Natasha Billing, Nest advisor and Global Marketing Director (ex-Made.com, NA-KD, ASOS)
It’s important to remember that what resonates with your audience in the US will not necessarily resonate elsewhere. You can even spot huge differences in the increasingly homogenized Anglosphere - for instance, advertising for US outdoor brands portrays hiking, guns, and camping in state parks, whereas UK brands might use pubs and soccer to attract a more urbanized audience. If you reused your US creative in the UK, your cultural references simply wouldn’t track.
There’s also the challenge of the American image itself - in the US, it can be attractive to promote a product as British or French because it denotes European sophistication and elegance. European audiences, on the other hand, aren’t always drawn to products marketed on their US origins.
Essentially, you need to carry out positioning work to understand your target audiences in each country. Think about what they do in their spare time, their aspirations, life goals, and senses of humor as you draw up personas. You need to deliver both brand and performance marketing so that there is a constant flow of customers on the path towards conversion.
Localized Asset Optimization
At first, a fear of overinvestment can mean US brands simply transplant their best-performing digital campaigns and creative to Europe, rather than create new assets. This strategy isn’t necessarily wrong - US content often performs reasonably in countries like the UK because of cultural similarities - but it won’t allow you to reach your full market penetration potential.
Brands looking to dip their toes into the market in a low-risk fashion can look to specialist ecommerce agencies like Nest for asset optimization services. Here, a team of Paid Social creative experts will review a brand’s existing bank of content assets and repurpose it to craft compelling, original ideas. The process usually involves the iteration of top-performing campaigns to unlock incremental value in Europe, adapting design and copy for local audiences to build out new creative without requiring a brand to invest significant resources. Localization may involve visual adjustments, a different tonality, a new product assortment, or all of the above. You’ll need to go in with a thesis based on data, a new hypothesis, and a culture of curiosity and experimentation. Social platforms will show which messages are resonating quite quickly.
As part of your research process, find partners who can advise on the elements of your brand you can stretch and flex in a local market. Speak to people on the ground who understand the customer base to find out what works and what people like about your brand and business. You’ll get a richer, more nuanced understanding, and can then leverage your digital channels to A/B test and prove hypotheses.
Original
Connecting with New Audiences
A key challenge for US businesses is authentic audience engagement. How do you convince skeptical new customers that you’re a trustworthy, exciting, and high-quality brand, with a product or service that meets their needs, all in a cost-effective and timely fashion?
UGC is arguably the most powerful tool for building brand awareness and trust in the modern era. It offers a simple, low-cost way to showcase content that spotlights your product and brand, all while feeling genuine and persuasive to its audience.
The fact that UGC is inherently localized makes it especially effective. Hiring a content creator, based in a domestic target market, to discuss your brand in their local language and accent is a surefire way to resonate with audiences. While content creators with large US followings sometimes cross over to Europe, their impact on the continent can be less pronounced and not worth the expensive outlay.
Nano influencers provide brands with particularly personal, authentic audience engagement opportunities for their specific niches or communities, while often charging much lower fees than big-name digital creators. Agencies like Nest have a global network of low-cost content creators they can tap into to help brands create Paid Social-first UGC. Further along your localization journey, Nest can also facilitate the creation of localized TOF lifestyle assets for a full set of country-specific content, using significant production capability to implement it at scale.
Privacy Laws
The European market is generally more focused on privacy than the US. Some data practices that are legal in America, such as not opting users in for cookies, can lead to heavy fines in Europe due to GDPR regulations (which are similar to the California Consumer Privacy Act). GDPR is retained in UK domestic law, as the UK GDPR , post-Brexit.
GDPR privacy restrictions also mean it’s tougher to employ a BOF campaign because of limited access to data. While the homogenized nature of EU regulations helps to streamline your conformity, differences can still remain between European countries. We recommend taking a cautious approach to collecting and using customer data as you expand.
Resourcing and Expertise
Siphoning off some of your resources to Europe can feel risky. The typical scenario can see a brand’s over-stretched in-house team try to remotely replicate US assets and conversion rates for new audiences. But the reality is that a successful European expansion requires dedicated focus. You’ll need company boots on the ground or a specialist in-region partner.
Advertising in Europe doesn’t require a huge capital investment. Instead, brands need data-derived insights based on credible tests and experiments; a lack of guiding expertise will breed low performance leading to missed opportunities. It’s why leading brands like Hims employ a local resource - they want to ensure their marketing investment pays back, which is hard to do when using teams without experience. Partnering with people who live and work in Europe ensures that you resonate with the local audiences.
A detailed understanding of the advertising ecosystem in each market is key - even around small choices, such as the efficacy of video vs. static vs. UGC. Having an existing dataset, and being able to tap into experience, allows you to make confident decisions. If you don’t have this know-how internally, there’ll be external specialists who can help.
Exploring the Key Market Nuances
As we’ve discussed, Europe isn’t a single market, even if described as one. You can’t simply target ‘Europe’; you need to prepare for, and adapt to, the significant nuances and differences - as well as find the similarities - within each target country. Let’s walk through the five key markets we recommend for landing and expanding.
“If you’re trading digitally, you’ll be able to use existing data to see which markets or countries are interested in your brand and naturally make plans to expand there - whether that’s wholesale, standalone, marketplace, or a mixture of the three. Your data should be granular enough to inform hotspots for your brand in each country - for instance, your German data might highlight that Berlin is the ideal place to launch first, partner with a 3PL, and even open up a physical store.”
- Jennifer Roebuck, CEO of Lumen Studios
The United Kingdom
Often described as the most advanced ecommerce market in Europe, total digital ad spend in the UK alone is higher than the next five largest markets (Germany, France, Spain, Italy, and Switzerland) combined.
An existing US-UK brand ecosystem means that Brits are used to American businesses. Similarly, younger Brits, who consume a lot of the same digital content as Americans, exhibit many of the same tastes and behaviors, particularly around mass consumerism. As a result, there’s a lot of parity to the US across customer expectations, delivery propositions, and buying behaviors.
Population: 69,234,494 (2024)
GDP: $3.495 trillion (nominal)
Ecommerce users: 56.7 million (82% of population)
Digital ad spend: €34 billion ($37.9bn)
Language: English
The UK market also tends to be as similarly promotion-driven as the US. Brands in the UK often rely on key sales event dates like Black Friday for sales, rather than expect purchases all year round. In fact, British shoppers spent as much as £8.74 billion ($11.76bn) over the 2023 Black Friday weekend.
From a pricing point of view, it’s important to benchmark against the closest UK competition - a British customer will compare and scrutinize price points, especially since the UK’s economic downturn. It’s one to watch if brands sit closely together on the proposition spectrum.
When it comes to product choice, particularly around fashion, the UK consumer is often savvier than a homogenized US counterpart, with greater style variation, niche brand consumption, and personalization. They largely focus on buying only what they need, rather than stockpiling. This should fill smaller, more unique brands with confidence - get yourself in front of the right customers, and there will likely be a niche market for you in the UK.
Germany
Germany is Europe’s largest economy and the third-largest in the world. Although it lags slightly behind other countries in terms of ecommerce, the market has its advantages - language and cultural similarities mean you can use your German networks to seamlessly expand into neighboring Austria and Switzerland, unlocking as much as 25% more revenue as a result.
Population: 84,552,242 (2024)
GDP: $4.591 trillion (nominal)
Ecommerce users: 57.4 million (68% of population)
Digital ad spend: €13.42 billion ($14.97bn)
Languages: German, English (66% of population)
As touched on earlier, the main challenge when navigating the German market will be its unique payment requirements.
Credit cards are rare - instead, non-credit payment methods such as Maestro, SEPA direct debit, SOFORT, Giropay, and Paypal account for the majority of online transactions.
Germany’s historical invoice payment culture also persists, particularly among older generations. Rather than pay upfront at the point of sale, some customers prefer the product to be delivered with an invoice that must be paid within 14 days. Many retailers will need to provide this as an option to capture a wide audience. Fortunately, the country’s SCHUFA credit rating agency can now perform fast online credit checks for ecommerce transactions, minimizing the risk of invoice insecurity and fraud.
Meanwhile, the country’s data protection and privacy requirements need attention. Germany’s laws are often even stricter than European counterparts. Citizens are well aware of their rights and aren’t afraid to exercise them - whether that’s refusing to accept everyday cookie policies to taking companies in breach to court.
One unique rule is the “double opt-in” principle, which adds an extra layer of verification before a user is added to email marketing lists. While the rule makes it tougher to grow your databases, it also results in a far more engaged audience and more qualified marketing leads.
Ecommerce websites must also feature an “Impressum”, a page that states company information like its name, legal registrations, and tax number.
Plus, Germany’s “Button” laws contain tight restrictions on ordering and cancellation options - with “buy now” buttons, for instance, needing clear wording like “Jetzt kostenpflichtig bestellen.”
Strong distribution is key in Germany. The country has one of the highest product return rates anywhere, with over a third (34%) of fashion items returned in 2022almost double the European average (19%). To reduce returns and minimize costs, brands need to bolster the initial customer experience. For example, AI tools can advise shoppers on outfit choices based on their body shape and style preferences. Though Germany has a high degree of English proficiency, establishing your brand will require localization of your websites and creative. Avoid word-for-word translations, as puns, wordplay, and context can often fall flat. Instead, build a German framework for your brand and persona, and give creative freedom to native copywriters and designers to work within it. They will be able to better appeal to the market’s preferences for a direct, benefit-heavy tone of voice, and can help you avoid common pitfalls - such as lengthy German words breaching Google PPC ad character limit criteria.
France
Language is fundamental in France. Strong national pride and a significant worldwide cultural impact mean the country has a much lower English-language proficiency level than its counterparts. When it comes to video, French people expect native actors and voice-overs, craving authenticity in all communications. Basic English slogans, such as Nike’s “Just Do It”, may fly - but more complex wording will fail to connect.
Consumers in France also expect a softer marketing approach. Successful advertising campaigns are largely built on the product’s social impact and the customers’ values. While the product and its key benefits
Population: 66,548,530 (2024)
GDP: $3.13 trillion (nominal)
Ecommerce users: 42.6 million (64% of population)
Digital ad spend: €9.51 billion ($10.6bn)
Languages: French, English (39% of population), Spanish (13%), German (6%)
should still prominently feature, adverts must show how it seamlessly integrates into consumers’ everyday environments, families, and lives. Similarly, France is a diverse nation - home to the largest Black population in Europe - so comms must authentically reflect pluralistic concepts and a collective cultural identity, without being seen to simply tick a box.
In terms of product quality, French consumers are more demanding of their brands than Americans. They’re more likely to spend more money on a few premium items than to buy volume because it’s cheap. They also rank highest in Europe for buying more products from the brands they trust. Your marketing should therefore reflect quality, value, and ethics, rather than a cheap or cheerful approach.
Advertising in France is subject to strict regulation. Alongside GDPR and data protection laws, there are strong rules
around misleading or fake commercial practices, product placement, and the promotion of lottery and betting games. These directives extend to digital advertising, with online influencers facing jail time or a fine of up to €300,000 ($322,000) under laws introduced in 2023.
France also has specific, regulated periods when brands can legally go on sale, known as “les soldes” (the sales). Its two official sales periods, a maximum duration of 4 weeks in winter and summer, are the only times when retailers can legally sell items at a loss (below cost) to clear out stock. This is unlike the US and many other countries, where retailers can offer sales and discounts throughout the year without much restriction. Before you launch in France, set aside significant time and resources to review its frameworks for sales, advertising, and data collection.
The Netherlands
The 2024 UNCTAD report shows that the Netherlands boasts the world’s highest share of internet users making online purchases (84%). Meanwhile, the latest EF English Proficiency Index found Dutch people to be the best non-native English speakers anywhere on Earth. The country’s ecommerce market is therefore highly diverse. Advertising targeted to advanced urban areas like Amsterdam, Rotterdam, and Den Hague is often broadcast in English - enabling you to freely repurpose some of your existing content. However, language proficiency dissipates outside of major cities, so be sure to use Paid Social platform settings to align your content’s language to that of a user’s smartphone or computer.
Population: 18,228,742 (2024)
GDP: $1.14 trillion (nominal)
Ecommerce users: 15.3 million (84% of population)
Digital ad spend: €3.75 billion ($4.19bn)
Languages: Dutch, English (93% of population), German (71%), French (29%)
Dutch credit/debit cards aren’t usually printed with the details, such as card numbers, that traditional online payment methods rely on. As a result, the country’s most popular transaction system is iDEAL, which involves a direct online transfer from the customer’s bank account to the merchant. Before a US brand enters the Netherlands, it must set up iDEAL capabilities to ensure receipt of income.
When it comes to messaging, Dutch people are clear and direct and prefer advertising to get straight to the point, with no social cues or assumed subtext. However, they also dislike loud, brash adverts and Americaheavy branding, so your comms must walk a fine line in between.
Similarly to language proficiency, preferred messaging styles evolve outside of the major cities, too. Amsterdammers, like their London and Parisian counterparts, have a penchant for being cool, chic, and brandfocused. In contrast, rural inhabitants prefer a simple, practical approach. They’re also increasingly frugal, so be sure to focus on high-quality, durable products over fast fashion offerings.
Sweden
According to the 2024 UNCTAD report, Sweden has the world’s third-highest share (80%) of internet users making purchases. It’s a highly attractive ecommerce market to target - as long as you meet its unique preferences in advance of launch.
Population: 10,618,584 (2024)
GDP: $623 billion (nominal)
Ecommerce users: 8.5 million (80% of population)
Digital ad spend: €3.34 billion ($3.72bn)
Languages: Swedish, English (89% of population), German (30%)
Debit card usage is almost double that of credit cards, with credit card use steadily decreasing since 2016. This fall correlates closely with the rise of Klarna: the BNPL giant was founded and is headquartered in Sweden, leading to ultra-high domestic market penetration - seven in ten Swedes now use Klarna for online payments.
Similarly, Swish - a Swedish mobile payment app similar to Venmo - counts over eight million users (out of a population of over ten million) and is used daily for transactions between individuals, traders, and businesses. So, US brands must offer both BNPL and Swish payment options to achieve parity and meet customer expectations.
Swedes are consistently ranked as some of the best non-native English speakers in the world - 6th overall according to the latest EF English Proficiency Index . So, you might expect to be able to reuse much of your English-language creative content. However, localization remains crucial.
“Swedes expect native capitalizations, currency figures, date ordering and more. They are also quite direct as a people, less swayed by offers and discounts. Instead, they prefer time to plan their purchases and do their research, so be sure to provide in-depth product information and clear uses and benefits - particularly around sustainability.”
- Birgitta Erikson, Head of Acquisition at Readly
Swedes are less expectant of door-todoor delivery services than European counterparts due to Sweden’s standard living arrangements - entrances to apartment blocks in built-up areas are usually protected by door codes. Shipping instead often takes a handful of days, with delivery usually to a local post office/ convenience store/drop-off point that then alerts customers of arrival via a smartphone notification. These arrangements can feel complex to newcomers - so be sure to partner with a local market expert to get it right.
Ultimately, cutting corners in Sweden isn’t an option. Even ecommerce heavyweight Amazon is still recovering from a patchy launch, with errors ranging from incorrect flag use to nonsensical product translations. Start as you mean to go on by investing properly into the market, and Sweden and Scandinvia will offer a receptive economy for you to explore.
Strategic Marketing Approaches to Set Up for Success
The simplest, minimally viable way to approach Europe is to target the entire continent by broadly running English-language ads, leading to an English-language website. Rather than localizing your content, this approach bets on the region’s high level of English proficiency and relative tolerance for Anglospheric culture. But while this strategy may bring a certain degree of initial success, the lack of localization will likely mean you never truly establish yourself in each domestic market.
An alternative approach is to group countries together that share a similar culture, such as the Nordics, and target them with synonymous ads. However, European markets are all so different that, while grouping might bring efficiencies, the effectiveness of your marketing will depend on how well it meets specific domestic expectations.
“In big markets like the UK, the economies of scale of going broad and driving CPM down can outweigh the benefits of targeting more granularly. However in markets like Sweden or Netherlands, there aren’t that many people to drive those economies of scale, so we see slightly more targeted audience strategies like lookalikes and interests outperform a broad approach.”
- Rodrigo Aspillaga, Operations Director at Nest
At Nest, we’ve found that intentional, international localization is an ultra-valuable investment that consistently brings high returns. If you truly want to make Europe a success, localization is worth embarking on from day one.
The smoothest, most effective entry point for European expansion and ad localization is the UK. Along with sharing the English language and multiple cultural touchpoints, the UK is the continent’s largest, most advanced ecommerce market. London, in particular, offers a diverse, affluent market for many brands.
By starting in the UK, you can most easily reappropriate your existing content, rebrand your websites, and localize some of your creative production like UGC. UK investments into localization are much less complex and much more cost-efficient, bringing with them far less risk because of the market’s size. You could even try running strategies concurrently - for example, localizing for the UK and running broad or grouped-country ads in Europe to build data that identifies your next localization target.
“Expanding into Europe is like peeling back the layers of an onion. Each layer presents its own investment case, filled with both risk and potential reward. For US brands, the UK offers the most balanced opportunity in terms of risk and return, thanks to its shared language, cultural similarities, and significant market size.”
- Luke Jonas, co-founder and CGO at Nest
Europe can be safely approached in incremental steps in which you build investment cases along the way. Following the UK, it’s best to choose your next market based on a number of different factors, such as seeing organic sales coming in from those countries already, deciding that your brand’s aesthetic is more likely to find success there, and how fast you can localize your creative and online assets to offer parity across payment, logistics, pricing, and more.
Focus on the Full Funnel
Regardless of the entry strategy you decide upon, running a full-funnel advertising approach could not be more important. When you first expand internationally, you’re effectively starting from scratch. No one knows who you are, what you do, why you do it, and why they should care. This is why a full-funnel approach is crucial when entering a new market. You need to deliver awareness-oriented creative to cold audiences that tells the market that you exist, illustrates your purpose and offering, and explains why they should be interested in you.
It’s vital you break free from familiar routines and patterns in your digital advertising and, in many ways, act like a start-up again. Agility, adaptability, and innovative brandbuilding tactics are crucial to maintaining your business growth via expansion and owning a niche in Europe. Patience remains key. Don’t expect your marketers or ads to produce instant results - give them time to introduce your offering and meet a customer’s needs.
Fortunately, TOF advertising still provides direct response results. For instance, mailing list sign-ups and increasing social media follower counts offer real-time indicators of higher-quality engagement. If this level of engagement incrementally grows, you begin to ease some of your BOF urgency tactics, and you still see a strong baseline of revenue coming in, you’ll know that you’ve truly built a strong brand.
Essentially, you need to leverage Paid Search and Social within a full-funnel media plan to build your awareness, land your brand, create consideration, and drive demand. Investing only in pure performance marketing will significantly limit the size of your market. While PPC advertising may seem efficient at first, it will only scrape the barrel of existing demand and quickly lead to fatigue and higher costs. Paid Search still has its place - but the most successful ecommerce brands embrace a holistic strategy, with a greater focus on Paid Social
Ultimately, the proof is always in the conversion - you know from e-commerce metrics whether something is working. Then, you can use this data to inform more effective decision-making.
- Preston Rutherford, co-founder at Chubbies Shorts for acquisition.
“In a new market, TOF advertising - the content that gets customers to feel, pay attention, and care about your brand - is what differentiates you, not free delivery or half-price offers. Businesses must change their mindsets and KPIs from purchases and ROAS to quality engagement that, over time, translates into resilient revenue.”
How to Resource Your European Expansion
Option 1: Use your existing US team to run your European marketing remotely
Restructuring your American business to extend its remit to Europe can feel like the easiest, safest option. It’s a solid choice if you’re a larger business with sufficient personnel and existing internal know-how of specific digital marketing strategies.
However, you may lack the local expertise and cultural knowledge that informs truly effective creative advertising. And while this approach might feel the most costeffective, not only do Americans command higher salaries than Europeans (the average US annual salary was $80,526 in 2023, compared with $62,473 in Germany, $55,680 in France and $55,173 in the UK), but a lack of local proficiency will likely mean your investment fails to ever reach its full potential.
Option 2: Hire a new UK or Europe-based team Option 3: Partner with a specialist European agency
Similarly, if you’re a large business with significant capital, investing in a boots-on-the-ground European team provides a strong balance between cost efficiency and regional expertise. But for SMEs, it’s a highrisk strategy that requires sizable capital expenditure before you know for sure if your brand will succeed.
It’s also important to remember that European employment laws are stricter than in the US, with full-time staff enjoying much stronger protections. If an employer wants to terminate an employee, there must be well-documented established reasons - the concepts of at-will employment and hiring and firing simply don’t exist in Europe. If you invest in a European team and then find your brand isn’t resonating with audiences, it can be tough to close that part of your business down, and you may fritter away precious resources on an unresponsive market.
Your third option is to hire a local ecommerce marketing partner - one that’s running multiple European brands at scale across all major markets, has previously achieved internationalization with American brands, and is staffed entirely by European specialists with decades of collective expertise.
Partnership with an agency is an ideal way to test out the European market with relatively low risk. While you’ll enter into a contract with them, it’s not as laborious and bound in red tape as employing staff and can be much more flexible in terms of scaling or bringing in specific skill sets.
At Nest, we believe an agency partnership is the model approach, simply because you’re hiring local experts who you can rely on to take the right approaches for each market. They can help you work out the opportunity and, if all goes well, you can continue to scale up with them. When it comes to crafting a business case, an agency partnership offers that rare combination of low risk and high reward.
“Work your network. Speak to people you know, people with presences in the UK and Europe to understand the lay of the land and the best operators there. Run a rigorous process to select an agency, in the same way you would in your home market. Review their strategy and their ability to execute it. Read case studies of companies who have made similar moves and look up the clients of the agencies you’re speaking to. This way, you’ll be best equipped to decide on the strategy - and agency - for you.”
- Will Ashton, co-founder and CEO at Nest
Want to Learn More?
A Shoptalk Breakfast Event
October 17th, 8am (CT)
Meta’s Chicago Office
In this unofficial Shoptalk satellite breakfast event, we will outline our winning strategy for expanding into European markets.
Join us at Meta’s Chicago Office on 17th October - the venue is just a 15 minute Uber from the conference hall.
Breakfast and coffee will be offered.
SIGN UP TO RESERVE YOUR SEAT
A Nest International Scaling Webinar November 5th, 12pm (ET) / 9am (PT)
Unable to attend our event in Chicago?
We will be running an interactive webinar on the same theme for US brands that want to scale into Europe.
REGISTER FOR OUR WEBINAR