Currency Exchange Solutions

Barring some disaster that instantly and drastically affects currency exchange rates (like natural disasters), currencies, relative to US dollars, don't normally change more than a few cents at most throughout the day. However, if you're an enterprise eCommerce business moving massive volume through daily transactions where foreign money is involved, a delayed or inaccurate exchange of foreign funds can quickly add up to thousands if not millions of lost revenue and profit.

It's this kind of situation in which those businesses feel the sting that I had felt, albeit much more acutely. Clarity's mission when helping craft enterprise global multicurrency and multilingual eCommerce solutions is to make sure you never feel the sharp pain of unanticipated and unnecessary loss due to the incompetent execution of what should be a straightforward process.

Automated Currency Exchanges

Automation saves your organization time and makes your employees more efficient. On the transactional side of buying from a global online store, a customer is more likely to buy or buy again when the process is speedy and simple. You will never be able to achieve these two aims without an instantaneous transition from one currency to the next. I say instantaneous because that is exactly what it has to be in order to prevent fraud or exchange rate manipulation by a go-between or a lost customer due to a slow calculation of the price that's shown in their native currency.. There are some countries where you simply can't afford to have a nefarious third party hold your funds in escrow or act as the middle man between supplier and consumer.

These third parties can easily hold funds until the rate is lower, therefore costing you money, or simply cancel the transaction if the rate becomes unfavorable to them. For this reason, you can ship a product and never receive your customers' money or lose money on the transaction because the exchange rate tanked by the time that money middle man got around to giving it to you. A great enterprise level multi-currency platform will side step these processes simply by integrating an automated currency conversion module. Best of all, this module can instantly calculate exchanges across all countries where you are legally allowed to do business.

Global Currencies Change Price Strategies

Have you ever seen the price of Ikea furniture displayed as something like $77.05? That would be the US dollar price for a 499 Krona (Swedish unit of money) piece of furniture. But of course this isn't the case because any marketing manager knows that the price consumers see and how they perceive it matters a great deal. Likely, you would see that furniture priced at $74 or $79 because consumers like the simplicity in thinking 75 or 80 and leaving it at that. This is but one of the many ways pricing strategies change when you bring new currencies and foreign consumers into the mix.

Here are a few more common examples:

Law of Low Right Digits

It has been proven that the digit furthest to the right in the number is a more important factor than the discount itself. Therefore, an item priced at $52 discounted to $42 is more effective than a discounted from $49 to $39, even though the amount off is still $10. Consumers are more or less irrational when it comes to the psychological factors that influence buying behavior. If you understand these factors and apply them broadly across each item price after accounting for the changes from diverse state monetization exchange rates, you can have great success with a global web shopping cart that deals with several currencies. Remember this when you see all those prices at Walmart like, $49.88, $2,88, and the like. Every other store ends in 99, so Walmart must be cheaper, right?