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Doug Nebeker ("Doug")
I sell a niche desktop consumer app in the $30 USD range. The price is currently fixed to USD for everyone.
I see a lot of interest in non US markets (Brazil, Russia, Australia, etc..) but people there are not buying much because of the high dollar price. I've even seen reduced sales from Canada since last year because of the rise of the USD.
I routinely give out discounts to those who ask, but this is costing me time. I am thinking of rolling out an IP geolocation based local pricing system.
I am a little worried about people using VPNs/proxies/friends to get a cheaper price. This is something I could potentially measure, so if it gets really out of hand, I can always roll back.
My question is for anyone here who does local pricing: is it worth the trouble? I would be very interested in hearing your experience if you have such a setup.
Local pricing seems a good idea to me, although some people will query why other countries are getting a better deal. Still even big companies have differential pricing.
Sunday, August 09, 2015
Foreign customers also lose money on currency conversion. When EUR/USD goes for 1.09 on the FX market, their effective rate can easily be 1.05 or even worse.
Do you sell via an e-commerce provider that enables you to set prices in multiple currencies? If yes, you can fix prices for you major non-US markets based on, say, the average exchange rate over the first half of 2015, then adjust every six months.
Monday, August 10, 2015
Use the IP based detection and don't announce that you have local pricing. I guess about 100% of people won't ever notice the local pricing unless you're some major player. Which you aren't as niche products are never major players because... they are niche :)
I'm curious how low you must go to make decent conversion rates in developing countries. I guess many of these people CAN'T pay online at all. I live in Hungary, which is a fairly developed country, but the majority of people still have no means to pay online internationally. No matter how low your price is if the client cannot pay.
Dmitry, yes this is what I'm thinking of doing.
Zka, yes, I don't think I would make any sort of announcement.
I'd like to try to provide fair prices for developed countries where people CAN buy online. The strong USD is discouraging many people from places such as Brazil, Australia, Canada, Russia from buying US goods online. I would simply have a lower price for them, in their local currency.
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