April 04, 2018
Local Currency is Key to Going Global
Personalization and customization are big trends in marketing, and for good reason: consumers respond better to a personal approach and are more likely to follow through with a purchase if the product or service is familiar to them.
Small businesses have always done a great job tapping into this – and many are head and shoulders above large companies when it comes to taking a personalized approach with their customers. It’s the key to providing better customer engagement, winning repeat business and giving yourself a clear competitive advantage. This approach is also having a big impact in the world of e-commerce, where technology has leveled the playing field by making it easy for small businesses to sell to customers around the world.
Today’s e-commerce solutions offer stores that are intuitive and easy to navigate, that have an abundance of product detail, and that guarantee a secure and expedited checkout that encourages repeat visits and purchases. However, for businesses eager to sell internationally, local pricing is also an important part of a successful e-commerce strategy and a strong example of personalization and customization.
There’s an abundance of research showing that single-currency pricing on e-commerce websites negatively impacts sales conversion, as shoppers frequently abandon their shopping carts when price tags are difficult to interpret. While pricing in a single currency might be more convenient and cost effective for the seller, it’s clear that it has a negative impact on customer experience.
In addition to this added friction, it’s also more expensive for both consumers and merchants. For example, PayPal charges business accounts to receive payments, and uses a retail exchange rate that fluctuates depending on the currency conversion. They also charge fees for cross-border payments.
In the world of e-commerce, local pricing is the ultimate form of personalization and customization. However, while merchants can and do use online shoppers’ IP addresses to identify their locations and automatically switch to the correct online shop, there are real challenges for businesses that need to sell in multiple currencies and protect their margins from currency volatility. This is where a Firma international currency specialist can help.
Our Global Currency Specialists can work with small businesses that are selling internationally online to establish forward contracts that lock in payment and currency exchange needs at a known rate. This provides you with price stability and removes the volatility risks that could impact your bottom line – and it lets you provide the level of customized service that will help your business grow.
People appreciate seeing their own currency because they better understand how the products they’re buying relate to the pricing and the payment process. Like being able to shop in their preferred language, it demonstrates attention to detail, inspires trust through improved customer service, and ultimately boosts business because it makes for a much more enjoyable experience.