The world is becoming increasingly smaller. What was once a wild fantasy is now a reality: Multi-currency payment.
Shoppers can theoretically buy something from an American vendor and have it sent to them in Europe.
For ecommerce vendors, this means the pool of potential customers increases. You now have access to the entire world - and not just people in your immediate vicinity.
For shoppers, this widens the pool of stores they can buy from, giving them more freedom and flexibility to choose exactly who they spend their money with.
But navigating the world of multi-currency ecommerce is difficult.
You want to accommodate all your customers' needs and part of this includes not making your customers have to calculate the prices themselves.
In this post, we'll walk you through how you can meander through multi-currency stores and some best practices for getting it right.
Let's go!
The benefit of accepting multi-currency payments
If you don't offer multiple currency options but still want to sell internationally, you face a problem.
You might think it's a cool idea to offer your products worldwide, but without a multi-currency strategy, your customers face charges on their end.
When their credit card company processes the payment, the customer will have to pay for the conversion fees. As you can imagine, this will make them much less likely to want to shop with you in the future.
So instead, use a multi-currency strategy to ensure that your pricing is as transparent as possible and there are no nasty surprises.
Displaying multi-currency options
You need to consider how you plan to display your pricing. This is the best way to earn and keep your customers and potential customer's trust.
If your customer sees the price in $ but they want to buy in £, how much effort do you think they'll take to work out the conversions?
One of the best ways to do this is to use rounded numbers. Instead of writing £35.46 just use £35.00.
You have two options here:
- Show all the currencies on a single product listing page.
- Have duplicate sites for each region or country.
There's a benefit to both options and the one you decide on will largely depend on your own resource and budget.
Let's look further into each of the options.
In the example above you can see each product listed with a dollar pricing. However, the box to the top right-hand side shows the customer that they can change it to their native countries' pricing.
You could also build an entirely different store based on the location of the customer.
This works by picking up the IP location of the current visitor and automatically changing the website and prices to suit them.
Although this is an effective streamlined way to do things, it can actually become expensive and time-consuming as you have to manage multiple websites.
Deciding prices
You might decide to pick some of the more popular currencies (euro, dollar, pound). However, the best way to decide on your currency decisions is to look at your analytics and see what countries your customers are actually coming from.
If it will cost you more money to implement prices in Euros and you don't have any European customers, it's probably not the best use of your resources. If you have at least 5% of customers from a specific country, it's worthwhile supporting their currency.
Setting your prices provides you with two options:
Manual price setting
Manual price setting is effective because it gives you complete control over your product's prices. This strategy works best for stores with fewer numbers of products simply because it's much easier to keep track of how your products are performing.
If you're a much larger store, you might want to consider automatic pricing.
However, manual pricing means that you need to think about and factor in exchange rates and change your prices accordingly.
This can be time-consuming so you might question whether your time is better spent elsewhere.
However, if you do have a small product line where your product prices are relatively stable in price, manual conversion might be a convenient option to consider.
Automatic price setting
Automatic pricing, for example, is great for those with many products. In this scenario, your prices (across all currencies) are automatically converted throughout the day and changed according to the most up to date exchange rates.
These apps tend to be largely user-friendly and plug and play. The primary benefit of automatic pricing is accuracy. You never have to worry about inaccurate conversions and what's more, you save time.
Track multi-currency prices of competitors
Prisync covers worldwide ecommerce sites. When you sell internationally, setting profitable prices can be a big challenge. Why not monitor all websites from all marketplaces? Because pricing can be a big challenge when considering many countries, currencies, and competitors, it's a very time-consuming task to do manually. You can add product URLs from foreign countries to your Prisync dashboard. Since we want you to have competitive and profitable prices, covering your competitors worldwide will help you on this topic.
With automation, add sites from different country domains and sell your products by setting prices according to their pricing strategies. It's essential to keep an eye on your competitors when there is an opportunity to increase your target audience and boost your sales with higher revenues.
Using a multi-currency payment system
With the increase in technology systems, you're now able to use software that helps you navigate the world of multi-currency pricing.
Think about Amazon for example, they have an internal payment system that allows them to sell to different countries.
Because of this, their global reach is huge and they have become a household name powerhouse.
You want to make sure that even if you sell in multiple currencies, you receive the payment in your native currency.
This will help you further down the line when it comes to taxes and conversions.
Implementing a payment solutions provider will help convert your prices into the currency of the person viewing your site at the time.
This way, neither you nor your customer needs to worry or stress about conversions and added fees. It also takes into account currency changes which happen often.
This process is known as hedging. Where the payment provider handles the risk of any foreign exchange.
Using this strategy will save you time and future headaches.
Final thoughts
If you're looking to expand your business and sell into new markets, multi-currency support is the best way forward.
Not only will it give you a wider customer base, but you'll be able to increase your overall revenues.
All over the world, in Asia, China and, even India, the world of ecommerce is rapidly evolving. Not only are shipping costs reducing but people are happy to pay for good products, even if they don't come from their native country.
The best thing to do if you want to start is to think about how you're going to price your products for your local market and your international market and then use specific pricing systems to help you price your products in a way that's fair for every buyer.
What methods have you used to sell internationally? Leave a comment below.