Change your display currency
The first and most straightforward type of pricing localization is where you only change the currency shown. This localization strategy is also called “cosmetic” localization. When you use this strategy, customers avoid any sticker shock at checkout or after payment since they see the price they’ll pay upfront. Having local pricing also makes it easier for potential customers to imagine the cost in their budget without mental math for the exchange rate. (View Highlight)
The benefit of cosmetic pricing localization is how simple it is to implement. There’s no need to adjust your pricing strategy or tiers—simply update the currency based on the person’s location. This pricing localization strategy works best when the exchange rate and cost of living between the base currency and display currency are similar. (View Highlight)
Note: Need similar COL and FX rates between localities
Change your product cost
The second type of SaaS pricing localization is more strategic than a simple cosmetic change in currency. Instead, you can customize your pricing based on your customer’s cost of living and purchasing power and have “true” localization.
A country or region with a higher cost of living or exchange rate closer to your home currency has a similar or identical price to home. A country with a lower cost of living or buying power pays a proportionally smaller price. (View Highlight)
Note: Wes Bos does this. Education course prices are tailored to local.
While customizing your SaaS pricing based on the cost of living is more work than changing the display currency, it could be the way to go for some regions. If you want to expand to markets with very different economics than your own (whether they have more or less purchasing power), true pricing localization makes you a more accessible option. Pricing localization may even give you a competitive advantage if you’re the only option doing it. (View Highlight)
