Everything you should know about currency localisation for international ecommerce sales
Samir Kamnani
·December 26, 2024
Cross-border ecommerce is big business. The cross-border ecommerce market was valued at $1.976 trillion in 2024, representing 31.2% of all global online sales.
Selling your products internationally provides the opportunity to effortlessly scale your prospective customer base—but to do cross-border commerce effectively, you’ll need to hone your approach to each geographic market.
Localisation is crucial to build consumer confidence in your brand. That includes translating your marketing copy into the audience’s local language or regional dialect; customising your product inventory based on items that are popular or available there; and, most importantly, converting your pricing to the local currency.
Shopify found that 92% of global shoppers prefer to purchase items from sites that display prices in their own local currency, and 49% of surveyed US and UK customers would abandon the purchase altogether if they weren’t able to use their own currency.
If you want to build a successful cross-border business, it’s important to provide local currency options. Here’s how to get it right.
Use ecommerce tools to set up storefronts for each region
If you run your business on Shopify, you can tap into new markets effortlessly by taking advantage of the ecommerce platform’s range of cross-border sales tools. You’ll be able to personalise each regional experience with language translation or localisation; custom themes and graphics; and curated product inventory featuring the items you wish to sell in each region. When a customer visits your website, they’ll be automatically directed to the localised version for the country they’re based in, ensuring they get the most relevant brand experience possible.
Customise your pricing models
When it comes to calculating your pricing, you could set your pricing up to automatically convert into the customer’s regional currency, which will keep it at parity no matter how the exchange rates fluctuate over time. However, many brands take a more nuanced approach: For example, you might price a product higher in a high-income region, and drop the price in a lower income region to ensure high levels of demand in each region.
Setting static prices in each region can increase customer confidence, as they’re not seeing the prices of an item they’re considering shift on a day to day basis. However, if you set fixed prices in international currency, be sure to review them regularly in light of changes to the exchange rate that may impact your profit margins.
Include localised payment options
Beyond localising your pricing, it’s important to localise your payment methods based on how shoppers in each country prefer to pay. For example, in Australia, a local debit card scheme called Eftpos is extremely popular, with 49 million cards in circulation. Ensure that popular regional payment options are available alongside common credit cards and other payment options, so that your shoppers won’t get to the payment screen and find that they don’t have a valid way to pay.
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Calculate shipping, taxes, and customs fees upfront
Costs are necessarily higher when shipping internationally—so it’s important for your customers to understand the total price upfront. International shipping fees, import taxes, and duty fees can all drive up the cost of your products, and it’s important for shoppers to understand them before they get to the checkout screen, so they don’t get sticker shock and decide against the purchase.
When a shopper adds an item to their shopping cart, you can include a cost estimator that shows the total cost, including shipping and other fees, in their local currency. You can incentivise the customer to buy more by offering free or flat-rate shipping on purchases of a certain dollar amount, helping them get more value from the transaction.
Build a best-in-class international returns programme
Whether you’re handling UK returns management or navigating returns management for Australia, it’s important to build a returns strategy that will protect your profit margins while ensuring a positive customer experience.
The cost of international reverse logistics isn’t cheap, so make sure that you’ve calculated the cost of shipping fees for each market, and factored that into your pricing—whether you charge more upfront or ask the shopper to pay for return shipping.
There are some options for saving money on international returns: Depending on the scope of your local operations in each region, it can often be more cost-effective to send returns back to an in-country warehouse or 3PL for redistribution, rather than shipping internationally. Or, if you know the item won’t be resold, consider offering a “returnless refund,” in which you authorise the customer to keep the product even whilst receiving a refund. Using returns automation technology like Loop can help you improve operational workflows and reduce costs associated with international returns, with customised workflows and outcomes based on the return conditions.
During the returns process, you can use Loop’s tools to encourage shoppers to convert their returns into exchanges. Our Instant Exchange tool enables customers to swap out their product for any item in your store, applying the credit towards the price of the new item. By incentivising exchanges, you’ll be able to keep more revenue from the original transaction, and gain the chance to upsell the shopper on a higher-priced item.
By building a robust internationalisation strategy that personalises your brand experience for shoppers in each region, your brand will be well equipped to achieve success in new markets. Don’t miss out on the opportunity to tap into global markets—with the right technology to support your cross-border commerce strategy, you’ll be able to scale your brand globally with ease.
Ready to learn how to build an international brand? Learn how Loop can help you simplify cross-border returns. Sign up for a demo today.
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